Last May, a twentysomething ultra-Orthodox Jew named Yitzchak Alrov figured out that he and his large family were the victims of price-gouging by a cartel of dairy producers in Israel. Instead of imitating the Peter Finch character in Network and shouting “I’m mad as hell” from his window, Alrov started a consumer boycott on his Facebook page that soon spread like wildfire across the country. The media dubbed it the “Cottage Cheese Revolution,” and it resulted in significant price reductions on at least some dairy products.

In Tel Aviv a few weeks later, a 24-year-old sales clerk and aspiring film editor named Daphne Leef woke up one morning and realized that her meager wages couldn’t cover the rent increase that her landlord was demanding. Instead of looking for a cheaper apartment or a better-paying job, Leef announced on her own Facebook page that she would pitch a tent on Rothschild Boulevard to protest the city’s high cost of housing. Hundreds of young Tel Aviv residents joined her in what soon became a large tent encampment along the city’s most elegant thoroughfares. Within weeks, Leef and her comrades were leading the biggest protest demonstrations in Israel’s history, with (according to the organizers) close to 300,000 people taking to the streets last Saturday night.

Leef and the protest leaders called on the government of Prime Minister Benjamin Netanyahu to do something immediately about the housing crisis, the deterioration in public education and the national health services, and the precipitous rise in the cost of living for the middle class. Some of their demands were not only reasonable but economically necessary. Others, such as free day care for every child over six months old and a reduction of class sizes in all public schools to a maximum of 21 students, would do more harm than good to the economy and to the national budget.

What makes this protest movement unique is that it was spawned not by economic failure but by Israel’s extraordinary economic success over the past decade. Despite a huge defense burden (7.5 percent of GDP, compared with 4 percent for the United States), Israel came through the worldwide recession that began in late 2008 in better shape than almost any other Western industrialized nation. Last year, Israel enjoyed an amazing 5.6 percent increase in GDP, as well as a 5.4 percent unemployment rate that would be the envy of the Obama administration and almost every country in Europe. In any fair accounting, this economic success story would be at least partly credited to the policies of the Netanyahu government and particularly to the chairman of the Bank of Israel, the brilliant American economist Stanley Fisher.

Yet it is just as fair to note that the country’s spectacular economic growth, built largely on added-value exports and a high-tech boom, has left many Israelis behind. This is glaringly evident in Tel Aviv, bursting at the seams with new luxury buildings, renovated and gentrified neighborhoods, a thriving tourist industry, and a reputation as one of the word’s great “fun cities.” The unprecedented increase in the value and price of housing has occurred at the same time that an ever-increasing number of young Israelis want to live in Tel Aviv and won’t settle for anything less. Since the law of supply and demand is unforgiving, this has led to astronomically higher rents for those young people. This is the ground on which Daphne Leef and her generation met the housing crunch and took to the boulevards. Their pressure on the Netanyahu government to expand the supply of housing and break up the extractive monopolies (such as the dairy producers) is not only legitimate; it could also help Israel become even more of an economic and political miracle.

What some of the protest leaders and their adoring supporters in the media aspire to, however, is something far more dramatic. Like the New Left protesters of the 1960s, they sometimes seem to want everything. Take Haaretz, Israel’s most prestigious newspaper, which is so far to the left that it makes the New York Times seem nationalist and patriotic by comparison. The paper’s reporters and columnists have had a collective religious experience over the tent cities and the street demonstrations. For instance, they cheered Leef’s simpleton political speeches decrying the ministers of the Netanyahu government, “who meet in ugly little rooms with fluorescent lights and in which there is no spirit. These are the people who can’t feel our pain and don’t realize that the country belongs to us.”

Every protest speech blaming the Netanyahu government was manna from heaven for Haaretz, which suffers from the Israeli equivalent of Bush Derangement Syndrome. “Yesterday Israel celebrated its independence. That’s the way Independence Eve looked in our childhood,” wrote the paper’s star reporter and columnist, Gideon Levy, after witnessing the first big demonstration. “That’s the way independence looks when a people becomes free, when it wakes up from its winter and summer hibernation. After all the years of being dammed up the flood has come.” The second Saturday-night demonstration was held in front of the Kirya (Israel’s equivalent of the Pentagon), leading Levy to point out: “True, the call was no longer directed at the Kirya, as it should have been. The masses are not yet besieging its iron gates. But perhaps that too will come.”

Contrary to Levy and his faux-revolutionary colleagues at Haaretz, the demonstrations actually proved how deep and stable the roots of Israel’s capitalist democracy are. I spent several evenings on the boulevards with the tent dwellers and among the massive crowds on the Saturday-night marches. I was amazed at their gentle yet serious demeanor. On one Friday night on Nordau Boulevard, the protesters set up tables for the traditional Israeli Sabbath dinner, complete with wine and challah and long debates about the situation.

All this reminded me of a phrase from the 1960s, “Democracy is in the streets,” which was also the title of James Miller’s book about Students for a Democratic Society. I attended many of those sixties demonstrations, and I recall that almost every one of them ended with one form of violence or another. I also remember the hatred that many self-righteous New Left demonstrators felt for ordinary Americans. By contrast, here on the streets of Tel Aviv, with almost no police visible, there was not a single reported violent incident. The middle-class demonstrators really did conduct themselves like participants at an open-air Athenian forum.

If Netanyahu plays his political cards right, he could emerge from this season of demonstrations as the winner who pushed forward the additional economic liberalization and reforms that this “start-up nation” still needs. He has already acted to release massive tracts of government-owned land for the construction of new housing, including rental units. Last week, he appointed a committee of independent experts to report to his government on further steps that can be taken to meet the protesters’ more reasonable demands, without indulging in the levels of welfare spending that brought the economies of Israel’s Mediterranean neighbors—Greece, Spain, and Italy—to their knees.

Israel may yet emerge from its own “Tahrir Square” moment with the most successful and least violent of the Middle East “springs” of 2011. Just don’t expect Haaretz to acknowledge it.


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