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The Wall Street Occupation and the Cottage Cheese Revolt

The New York Times ran with two demographic surveys one day after the other. The first, which it headlined “Snapshot shows U.S. public more disillusioned than ever,” demonstrated that the American people are fundamentally miserable with their condition. They expressed egalitarian instincts at least to the extent that they want the distribution of wealth to be more even. But this feeling did not manifest itself in any particular warm feeling for the Democrats, although there is wide recognition that Republican politics and policy “favor the rich.” Another irony is that a majority of the public supports a wide range of the president’s concrete economic proposals. Yet this brings no balm to him, either manifest statistically in the survey or, as you and I well know, in the population’s perception of him as a loser (on virtually every issue except Iraq). So should the bad news for Obama give glee to the Republicans? Absolutely not. Their most popular candidate in the GOP presidential sweepstakes is Herman Cain, despite his minstrel affect about which you can read in John McWhorter’s quite dazzling piece earlier this week. This is very bad news for every other Republican contender, especially Mitt Romney who is the establishment’s point man but alienated from the deep and ugly passions among the populists in the party—who, I am afraid, are the party.

The second report, conducted by the Congressional Budget Office and discussed in the Times yesterday, is not a surprise. In fact, it is common knowledge that there has been a steep rise in the percentage of the national wealth held by an ever smaller cohort of the populace over the last three decades: 

The top 1 percent of earners more than doubled their share of the nation’s income over the last three decades, the Congressional Budget Office said Tuesday, in a new report likely to figure prominently in the escalating political fight over how to revive the economy, create jobs and lower the federal debt.

In addition, the report said, government policy has become less redistributive since the late 1970s, doing less to reduce the concentration of income.

“The equalizing effect of federal taxes was smaller” in 2007 than in 1979, as “the composition of federal revenues shifted away from progressive income taxes to less-progressive payroll taxes,” the budget office said.

No surprise, you may say. After all, Ronald Reagan and not one but two men named George Bush sat in the Oval Office during this period. Still, let’s face the facts. Bill Clinton was no enemy of the acquisition of wealth. And certainly no enemy of those who do the acquiring. Also, don’t forget his chancellor of the exchequer, brilliant dazzling smooth Robert Rubin who, as Frank Rich reminds us in his hyperbolically happy column last Sunday, was the architect of it all.

There was little public despair about wealth and poverty under W, although the poor certainly had no illusions that they were rich or even comfortable. Ironically, despair emerged under the White House stewardship of the former Chicago community organizer Barack Obama, acolyte of Saul Alinsky. It was Obama, after all, who told us that “yes, we can.” Unfortunately, even he couldn’t. And please don’t blame everything on the damn Republicans. Obama is responsible for something.

So we now have “Occupy Wall Street” and “Occupy Oakland” and many of the cities and towns in between. Also abroad. The “occupation” of Oakland, where Jerry Brown used to be mayor, was interrupted by tear gas and five dozen arrests. My bet is that the cops were provoked, as usual. Similar happenings occurred elsewhere. And, believe it or not, there was an “Occupy Yom Kippur” epiphenomenon on Wall Street and a few other locales, a mild version of the revolution and actually with contrition as its theme rather than revenge.

I know that several of my admired friends have signed on to the occupation. And, frankly, when Michael Walzer and Paul Berman endorse something I take notice and ponder. The fact is that I, too, share in the dismay—actually utter dismay—at the sharpening of the distance between privileged and over-privileged (yes, there must be a category for these) people and ordinary folk, even those whose contribution to society is great and reward very sparse. Woefully sparse. When I was in elementary school—P.S. 28 in the Bronx more than six decades ago—the model expenditure of an ordinary family for rent was 25 percent of income. Now, in all but the most depressed cities in the country, the paradigm is about 50 percent or more. So let’s not dismiss the grievance feeding and fueling the quite (as of now, at least) mild revolt. This is America today.

On the other hand, no real program emanates from the nationwide protests. This is not exactly a criticism. After all, when a crowd gathers (or, rather, multiple crowds gather) without hierarchy and virtually without philosophy, as Elias Canetti has taught us, the drift will always be to the abstract, to the more incendiary, to the emotionally gratifying. You cannot reach for power with such as your base. Which is why memories from the “demos” of the sixties and early seventies provoke only a moment’s nostalgia and deep regret otherwise, even disgust. My heart does not swell or break when I hear “Where Have All the Flowers Gone?” Since, moreover, I do not believe jobs will emerge from these demonstrationsor from the president’s rhetoric, I am left realistically pessimistic. Pessimism is our destiny.

As expected, there is a list of signatories to the “Occupy Wall Street” manifesto. This list has, as some idiot television talk-show host put it, many Type A celebrities on it. Susan Sarandon, for one. Naomi Wolf, who tried to dress Al Gore in earth-tones, for another. Jonathan Demme. And, of course, Gloria Steinem, all but forgotten. Alice Walker, also signer of anything anti-Jewish. Cornel West. 350 Columbia and Barnard faculty, including the Islamist faction plus the Columbia president Lee Bollinger who made the faction possible. (He is also a member of the New York Federal Reserve where, if he wanted, he could do something about reforming or even revolutionizing Wall Street. By the way, he earns $1.4 million per annum, which with his other annual lucre certainly puts him in the top 1 percent of earners.) Signer Michael Moore got into a pissing match with an interviewer, arguing that he may be in the top .1 percent but not in the top .01 percent, a real difference which, ironically, his stupid films have helped to obliterate.

In contrast to the politically minoritarian cast of the “big name” signatories, a poll done by the highly reliable Pew Research outfit demonstrates that 39 percent of the country is in favor of the goals of “Occupy Wall Street” and only a small minority support the aims of the Tea Party. With all the money and publicity behind the tax rebellion you’d have thought that these people would have done much better in public opinion. And given the amorphous character of the ideas behind the Wall Street occupying army you’d have thought—or I thought—it would have done much less well in the vox populi. Anyway, it is as it is. Except, as a poll of 100 occupiers, interviewed early on by Tracey Samuelson in New York magazine, shows, these folk don’t know squat about the financial system. Fully 75 out of the 100 identified themselves politically either with Ralph Nader or Noam Chomsky. Paul Krugman attracted 12 adorers. Maybe this cohort is the revolutionary vanguard. Hey, but what about Barack Obama who is, after all, the president? Three responders identify with him.

As you may have gathered, I am back in Tel Aviv where on July 14 (the birthday of the French Revolution) at Sderot Rothschild (the boulevard commemorating Baron Edmund de Rothschild, the grandson of the founding Rothschild and known as Ha’nadiv, the benefactor, which, indeed, he was, of Jewish agriculture in and Jewish migration to Palestine) about 300,000 Israelis gathered to protest the wild variance not so much in social status but in the economic possibilities of the population. Soon thereafter, the movement radiated out from one of the most fashionable but also hip streets of the city to virtually every town and townlet in the country. This weekend there will be more such assemblies, from Kiryat Shmona in the tipy-tipy north to Eilat on the Red Sea. There’s been a slight escalation in the rhetoric. The organizers seem to be testing the crowd’s ideological limits with their new slogan, “Back to the Streets.” We will see how it fares and what it brings.

There is great paranoia among the leaders, self-styled and actual. Their theme is that Bibi Netanyahu was so desperate to destroy the movement that he is allowing 1,200 terrorists to go free in exchange for one Hamas-incarcerated Gilad Shalit. Now, the liberation of Shalit after five years without visitors (even the Red Cross didn’t visit) and without eyeglasses brought a kind of sublime satisfaction to Israel. (Why no eyeglasses? His captors were convinced that the Israeli security services could locate him through them. Nut cases, if you’ll excuse me. But okay, they could have gone into town and gotten Gilad an innocent pair of spectacles.) Ha’aretz also trafficked in such grotesque fantasies about Bibi. But that’s another matter.

The politics of this amorphous “social justice” movement is hard to track. The costs of daycare, for example, are a burden to every family from the middle class on down. So they cut across from left to right, and as in America many among the poorest—perhaps even most—are on the right. The syllogism continues: Among the richest are people on the left. Still, rich or poor is a reliable predictor of nothing. As Daniel Doron showed in these columns, the etiology of this mixed economy goes back to the early years of the state when a socialist government mixed its own trade union businesses with select private families. Many of these intrinsically corrupt structures no longer exist. The governor of the Bank of Israel, Stanley Fischer, a legendary figure in the world economy, is largely responsible for the general reforms to the economy. But he couldn’t have achieved these without Bibi’s disciplined support.

And then came a government-appointed commission which has now proposed a not unanimously backed package of reforms. Plus, from another more-or-less independent commission, a different set of prescriptions, more populist in character but, of course, also without total support from the populace. Actually, in comparison to the rancor generated around other matters, this public discussion is quite thoughtful, even civilized.

Except for one idiosyncratic feature: A certain madness has taken over in the founder’s head. A dangerous madness, if not dangerous to Israeli society then certainly dangerous to the movement which Daphni Leef improvised. Ha’aretz put this headline on Nehemia Shtrasler’s article: “Israel’s Social Protest Leader Is Now Her Own Worst Enemy.” She has begun to give ultimata to the country’s prime minister. Here is a look at a leader with an insecure mandate who seems to think that she has the power of a commissar:

Daphni Leef has become her own biggest enemy. She has become intoxicated with power. You can criticize the prime minister and demand that he increase social spending, but you can’t humiliate him in public, address him arrogantly and treat him as if he were the lowliest of officials.

At Leef’s press conference this week before tomorrow night’s demonstration, she didn’t hesitate to present Prime Minister Benjamin Netanyahu with ultimatums; for example: “This is the last time I am addressing you directly.” How scary. If Leef roars, who will not tremble? She also demanded that he reverse economic policy completely so it will suit the caprices of her and her colleagues. She, after all, has the experience and knowledge and he’s merely prime minister: “We have no intention of compromising …. Your time is running out …. The keys to the country must be in our hands.”

If Leef believes the keys to the country must be in her hands, let her do us the honor of running against Netanyahu in the next elections and defeating him. We are, after all, still living in a representative democracy. At the press conference Leef spoke about the state’s obligation to provide all its citizens (for free, of course) excellent health care, a worthy education, fair housing, art and culture—and also a nice salary and respectable pension because these “are not luxuries but rather basic things.”

The fact is that there was a significant antecedent of the July 14 Rothschild Boulevard assembly, and it occurred not long before the great mobilization. It was modestly titled “the cottage cheese revolution.” It aimed first at the dairy industry led by a company named Strauss and following right behind was Tnuva, both run by women heads of the owner families. This fact allowed some columnists to take stabs at the idea that more women business executives would ease social stress. The Jerusalem Post ran an article titled “Unrest in Curdistan” and written by David Rosenberg. It cops out at the end, blaming the situation of the poor on the educational system, as if a grand revolution in the schools will do anything in the immediate future for harsh economic realities. But the piece describes the structure of the dairy industry and its role in the ordinary lives of Israelis—which is actually why the revolution started there:

The first thing is to recognize the real problem, which is that cottage cheese is a symbol of middle-class distress. As housewives were turning their noses up at the dairy shelves last week, Merrill Lynch published its annual report of the world’s millionaires. Israel counted a total of 10,153 in 2010, a remarkable 20.6% increase from the year before and more than double the worldwide percentage growth. The average salary last year rose 3.7%.

It’s not a perfect demonstration of growing income inequality in Israel, but it captures many of the issues. The economy is growing, but a small fraction of the population is enjoying most of the fruits. If you had a substantial investment portfolio, which millionaires by definition have, you did very well last year. If you had an advanced degree and worked in technology or finance, you did well, too. This is a trend taking place all over the developed world, but in Israel it is more pronounced because the economy is so reliant on hi-tech at its top end and has so many people not working at all on the bottom. After the US, Israel is the most income unequal society in the West.

Daniel Doron wrote another illuminating article, “It’s not just cottage cheese. It’s everything,” in the Post, and Calev Ben David a broader piece in Bloomberg. Thomas White gives us an amazing narrative of the revolution which has forced the food industry—the basic food industry—to respond to the boycott of its customers. Before the Jewish holiday of Sukkot, the Feast of Tabernacles, earlier this month the protest organization set a goal to reduce the price of food put on the table of an average family by 15 percent.

Of course, this aim was not met. But Osem, another huge company in the cartel, did reduce prices on 35 of its products substantially. This development was reported by Ora Coren in “The Marker,” the financial section of Ha’aretz. Included in the cost cuts are baby formula and other “Materna” products, ketchup, flour, crackers, chicken soup, soy sauce, corn products—and, of course, hummus and tehina. The company took its own initiative in announcing that starting in April 2012 it would not raise wages for senior executives but pay the sum saved to its employees who do not earn the company’s average wage.

None of this comes close to a real social revolution. But we’ve had enormously painful experiences with social revolutions over the last century, the poor even more than the rich.

Martin Peretz is editor-in-chief emeritus of The New Republic.