Capitalism, shopkeepers and the myth of the socialist clerk

A couple hundred meters from your house, Haim, there’s a bakery, a capitalist enterprise to the best of my knowledge. For a couple of years, I went there every Friday after morning services and bought the big flat pitot that my kids love for Shabbat dinner. The first time that the owner, or manager, or staff thug – I didn’t check his precise title – shouted at me for daring to stop to talk to a friend in his store, I ignored him. The second time, I put down my pitot on the counter and left. My friend came out and told me that the reason he does the Friday morning bakery run is that his wife refuses to enter the place, after she was target of a similar tantrum.

I feel a bit uncomfortable telling this story, because I generally enjoy life in South Jerusalem, and I’ve found another bakery where the pitot are great and the guy at the register is generally polite. But if you ask me :

Remember standing in line endlessly at the bank only to finally reach a surly teller? Remember sales clerks who thought they were doing you a favor by deigning to speak to you?

– well, yes, I do remember. And I don’t have to stretch terribly far back into my memory to find those incidents either. They happen regularly, despite the capitalist revolution in Israel.

The major change in service at my bank is that management has canceled all direct incoming lines to clerks. So I can no longer call the nice one who’s known me a couple of years, and ask him to take care of something for me. Not that the clerk could do as much as he once could – the bank has also cancelled much of the discretion that senior clerks used to have. I find the place more surly, less personal.

Is that because rather than being owned by a labor union or the government, it is now owned by one of Israel’s oligarch families? Or perhaps because a top executive went off for a course in America in running your bank efficiently? I can’t say. I’ll agree not to blame the rudeness of today on capitalism if you don’t blame the rudeness of 30 years ago on socialism. I’ll agree to that because I’m a peaceful guy, even though I might be suppressing some of the truth.

There is a view in political science that socialist clerks will be more imperious. Without the market to allocate scarce resources to the higher bidder, goes the argument, clerks and officials gain the power to allocate those resources as they please, informally, and therefore become small tyrants, or large ones. The theory resembles both the Marxism and the Friedmanism I heard from college friends and lecturers: It makes sense in theory, but reality is unruly.

In recent years, the rudest treatment I’ve received from strangers who are supposed to serve the public came from employees of US airlines and airports, and from the call-center employees of some – but certainly not all – US companies. If I had to create a theory explaining their behavior, I’d say they are underpayed, overworked, and given absolutely no discretion to respond to individual cases. As a result, they are frustrated, angry and inexperienced, because no one stays long enough to become experienced. However, ranked first for inefficiency and rigidity are government clerks – the ones in the US consulate here, responsible for renewing passports.

At the Israeli Interior Ministry, on the other hand, I asked last year to get my passport renewed on the spot. My father was very sick, and I was afraid I’d have to leave that night, and my passport was close to expiring. At first, the clerk said she could have it in a couple of days. I said that wasn’t good enough. “Go sit down and we’ll call you,” she said. Fifteen minutes later the head of the branch office called me to his desk and handed me the passport. He exercised discretion, and probably dumped the rulebook in the trash, because my dad was sick. I nearly stood up and sang “Hatikvah.”

I don’t think he was more socialist or more capitalist in his behavior. He was more Israeli. He also could have ignored rules and turned me down for something I should have gotten. I bet that you could come up with three theories linking economic history with Israelis’ disregard for rules and Americans’ rigid respect for corporate policy, but I bet you could also tear apart your own theories.

Medical care? Israeli medical care is still officially socialized, which explains why we have higher life expectancy that the US. In the old days I belonged to one of the HMOs where you could make an appointment with your doctor, and I still do. But when I recently wanted to move my daughter to a new GP, I was told that the physician had left the HMO. She apparently now takes private patients, especially foreigners wih American insurance who can be billed steeply.

The big change over the years in Israeli care: While medical expenses rise, the government is paying a lower share of the costs, and price of prescriptions keeps rising. Now some Israelis can’t afford their prescriptions, which was unimaginable in the 1970s. Just by coincidence, a tax ‘reform’ enacted by Netanyahu several years ago is steadily reducing income tax on top earners.

As for keeping inefficient factories open: Take Kiryat Gat or Kiryat Shmonah, towns whose location was chosen to serve political rather than economic purposes. If one ‘product’ of a factory in one of those towns is meaningful employment for people living there, then the factory may be efficiently serving its purpose even when the books show a loss.

The reality is that every government makes decisions to intervene in the market. In Israel of the 50s, government decisions for that purpose gave the country an extraordinary rate of growth and modernization, while the social gap was extremely low. In Israel of the 90s and the 21st century, government decisions to privatize have concentrated wealth in the hands of oligarchs.

Yes, there was corruption back when. Political appointees used to funnel cash into the party coffers. Now that we live in a capitalist system, corruption has vanished. Right? Just ask the prime minister. He’ll tell you. You can talk to him after his appointment with the police investigators.

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