The People of the Book or the People's Books?

On July 31st, Israel's legislature, the Knesset, passed the "Law for the Protection of Literature and Authors in Israel." The title alone should puzzle and worry freedom-loving people. Other than protect the freedom of expression, how does a government "protect literature" in a society where consumers have no restrictions on what they read? Why do Israeli authors need protection that is specifically different from that of other citizens and professionals? Why does the government of Israel, which ranks among the top 5 countries in the world for titles published per capita, need to "fix" a literary situation that is... pretty good as it is? Do the People of the Book need a law to promote literature and protect authors? What problem did this law supposedly correct?

According to the law's proposal, "... the book market has been dominated by a duopoly of two chains which control approximately 80% of the market, one of which is ... controlled by a large publishing house. This causes serious damage to the principle of free competition. The Ministry of Culture believes that ... there is no alternative other than to manage the market, even at the cost of intervention in the free market."

Has this "duopoly" translated into artificially high prices to consumers? Nope. The two major chains, Steimatzky and relative newcomer Tzomet Books, established as a discount chain, compete with one another using large economies of scale to sell books at attractive prices. Smaller book stores in Israel cater to niches, such as graphic novels (comics), used books, foreign language books, science fiction, specialty Judaica, to name just a few. These venues do not even try to compete with the "duopoly" on price alone. So, the current situation actually reflects a very healthy free market in which booksellers offer increasingly better consumer quality as a result of competition and improved customer service.

The law's proposal proceeds to describe its goals, "to ensure writers appropriate compensation for their work, to promote literature in Israel, to preserve cultural diversity in the publication and distribution of books in Israel, to provide readers an opportunity to choose from a wide variety of books according to their desires and tastes, and enable competition between publishers and booksellers regarding the quantity, variety and quality of books offered to the consumer." All of these goals reflect lofty ideals and yet all of them are already served in the current free market. Writers aren't coerced into agreements against their will and Israeli readers enjoy hugely diverse offerings, especially considering that Hebrew is spoken by relatively few people around the world. Somebody's trying to fix something that isn't broken.

So, what's the proposed "fix?" A "protection period" has been defined as the first 18 months from a book's first publication date, during which two sets of regulations apply. The first is a minimum rate of royalties to be paid to Israeli authors: 8% of the sales price (minus VAT) for the first 6,000 copies sold and 10% thereafter. The second is a prohibition against any bookstore selling a "protection period" book for less than the retail consumer price – except for during Hebrew Book Week and the weeks leading up to Rosh Hashanah and Passover, when booksellers can offer discounts of up to 10%.

The concept of minimum royalty rates might be fine for established authors, who have existing consumer fan bases – and therefore pose smaller risks for publishers. However, new authors present a large risk to publishers, and a minimum royalty rate eliminates any leeway to leverage increased risk with lower royalties. As a new author, I might be willing to substantially reduce my royalties for the chance of establishing myself in the literary world. Under the new law, I'm not permitted to do this. It is no wonder that 270 established authors and translators signed a letter supporting the law, which makes it harder for new authors to compete with them for the patronage of the reading public. It serves as protectionism for the established literary elite.

Any benefits of the prohibition on discounts during the protection period are questionable. According to the head of the Israeli Freedom Movement, Boaz Arad, this is the first time an Israeli law is prohibiting a financial discount to Israeli consumers. While the law assures that authors will receive higher royalties for every book sold, higher book prices will result in fewer books sold. Again, this might favor established authors, but it is likely that new authors will find it much harder to gain readers. Also, is it not possible for authors, especially established authors and publishers, to stipulate some contractual means of guaranteeing a minimum return on every book sold, without needing a law to do so?

The responses of the CEOs of Steimatzky and Tzomet Books to the law's passage were quite telling. Steimatzky CEO Iris Barel bragged that her company was the only one that supported the bill and thanked its sponsor, Minister of Education, Culture, and Sport Limor Livnat. Tzomet Books was established in 2002 as a competitive, discount alternative to the monopolistic Steimatzky. Tzomet Books CEO Avi Shumer did not comment on the new book law but, regarding price discounts, he said, "We respect all authors who would prefer not to be sold during sales." How interesting that a law supposedly designed to break a duopoly is supported by the former monopoly holder, but not supported by the discount-oriented bookstore chain. Price-fixing tends to favor established sector leaders, like Steimatzky, who prefer to avoid competing with hungrier business upstarts. 

What of other countries which have legislated book price-setting laws? A comparison of 14 European Union countries reveals that those with price-setting laws release significantly fewer book titles per 1000 citizens than do countries with either completely unregulated literary markets or those with non-legislated sector-wide agreements. Finland abolished its book law in 1971 and Great Britain did so in 1996. In both cases, the result was substantial growth in both countries' bookselling sectors. Both history and common sense indicate that this law will make books more expensive in Israel and damage the literary market. Fewer new titles will be published, fewer books will be sold, and fewer new authors will be published.

The book business is not an easy one. The digital age has brought us Amazon, e-commerce, digital books, e-coupons, and instant price comparisons, disruptive technologies which pose major challenges to the publishers and booksellers. Government protectionism will not make these challenges go away, it will just reduce the incentive of these industries to adapt and thrive under new conditions. Besides, the provisions of this law do not meet the rhetoric of the law's declared justification. The law does not encourage the diversity, quantity, or quality of literary offerings. Writing is one of the hardest professions by which one might scratch out a living; very few authors sustain themselves on their books alone. But is this such a bad thing? The greatest authors of the past 200 years have not demanded government protections - they had day jobs. At this point, new authors might find themselves "protected" to the degree of being un-publishable.

The recent legislation seems less concerned with the health of the Israel's literary sector than with the interests of entreched players like Steimatzky and the established intellectual elite - who seem to think they are entitled to their positions of influence independently of the choices of the consumers who sustain them. The cause of literature and literary culture is served when a well-read public has easy, cheap access to a dynamic marketplace that presents the work of both established and new authors. The best way a government can serve such a cause is to stay out of the way.

Free markets clearly benefit consumers, by linking customer value and merit with business success. The apparent apathy of Israeli citizens over this government intrusion into the intellectual marketplace, which will end up hurting the Israeli book buyer, is cause for concern. The law was passed with 45 ayes, 3 nays, and 72 abstentions. Even disregarding the gaping disconnect between MKs and Israeli citizens, this legislation can hardly be considered as the will of the people. The People of the Book deserve better - but it's up to them to demand it. If you want to find common cause in liberty and limited government, join the Israeli Freedom Movement. Check them out at www.liberal.co.il.

http://www.haaretz.com/culture/books/authors-demand-protection-from-royalty-cutting-book-chains-1.431803

http://www.liberal.co.il

http://main.knesset.gov.il/News/PressReleases/pages/press310713h.aspx

http://www.liberal.co.il/%D7%97%D7%93%D7%A9%D7%95%D7%AA/228-%D7%94%D7%A6%D7%A2%D7%AA-%D7%97%D7%95%D7%A7-%D7%9C%D7%94%D7%92%D7%A0%D7%AA-%D7%94%D7%A1%D7%A4%D7%A8%D7%95%D7%AA-%D7%95%D7%94%D7%A1%D7%95%D7%A4%D7%A8%D7%99%D7%9D-%D7%A0%D7%99%D7%A1%D7%99%D7%95%D7%9F-%D7%91%D7%99%D7%9F-%D7%9C%D7%90%D7%95%D7%9E%D7%99

A Fourth of July Letter to Children of Israel and America

To children, especially my own, whose parents brought them from America to live in Israel. The Fourth of July approaches, and I hope you'll mark the date.

As a child of the United States and modern Israel, you have a unique national heritage. You may be dual citizens; you may have connections to two very different lands, with two different governments and two different groups of citizens. Yet, the heritage to which you belong from both of these places can be considered as singular and coherent.

Early Americans, including the original Pilgrims and the Founding Fathers, identified strongly with the exodus of the Israelites from Egypt as well as the principles of living freely with individual rights. Eventually, they battled for independence from their own "Pharaoh," King George III, and set up a system of governance inspired by their understanding of the "Hebrew Republic," based largely on insights from the Torah and the books of the Hebrew Prophets. At times, the Pilgrims even referred to the American colonies as "New Israel;" to this day, throughout the United States, especially on the eastern seaboard, the names of towns, cities, and counties are taken from the Hebrew Bible.

Descendants of persecuted sects of Christianity in England, the American Founders were adamant that their new nation would be tolerant of diverse religions. They proclaimed freedom of religion as well as a prohibition against the establishment of any state religion in the very same Constitutional Amendment that guaranteed free speech. The most religious of the early Americans believed that true religious virtue was possible only in free societies, in which citizens exercised that virtue in the choices they made. This included freedom of thought. Thomas Jefferson went so far as to state, "Question with boldness even the existence of a God; because, if there be one, he must more approve of the homage of reason, than that of blind-folded fear."

On the Fourth of July, 1776, the Declaration of Independence proclaimed that all men are created equal. This never implied that all people should have equal wealth or abilities; it was meant to declare that all people are born with unalienable rights given, not by governments, but by God. These include freedom of thought, speech, worship, property, and self-defense - which were clarified in the Constitution that followed. To this day, there is growing interest among historians and Constitutional scholars about how the document was significantly influenced by the Talmud.

Another major principle of the American Constitution, and a key reason for the American Revolution itself, was the maximization of freedom by means of limitations, not upon citizens, but upon government. This, too, was inspired by principles of the Hebrew Republic, in which the very concept of a monarchy is viewed with concern, and even religious antagonism. Some European political philosophers of the seventeenth century invoked the Hebrew Republic to argue for the abolition of monarchy itself.

Despite historic abuses of power by Israel's kings, Hebrew kingdoms were not supposed to amass wealth, nor were they supposed to exist for the sake of providing for all the people's needs. They existed to defend against attack, to provide a national framework of governance, and to ensure that people were free and able to provide for themselves. In a system not unlike that of the states of the American union, the Hebrew tribes governed themselves in geographic localities.

The era of the American Revolution was also culmination of the movement of Christian Hebraism, when Protestant Christians sought to return to original Hebrew texts in trying to understand their roots. This didn't mean that, at the time, they loved Jews; it did reflect their growing respect for the origins of their concepts of justice, morality, and human dignity. The leaders of American institutions of higher learning, including Ezra Stiles of Yale, consulted and sometimes became close friends with rabbis in the area.

America has proven to be Israel's staunchest ally. But the relationship goes beyond geopolitical convenience and imperative. The values of individual rights and responsibilities, protected - but not dictated - by government is a legacy of Jewish thought. In this way, America arguably lays claim as embodying a legacy of Jewish governance. It's something Jews all over the world should be proud of. It's something Israelis should note, as an indication of how Israel's governance falls short when it tries, disastrously, to govern as a quasi-socialist welfare state, with its bloated, wasteful bureacracy, excessive taxation, and controlling over-reach into marketplaces and private lives.

The Fourth of July, 1776, coincided on the Hebrew calendar with 17 Tammuz 5536. The seventeenth of Tammuz annually marks the beginning of the three weeks leading up to the 9th of Av, period of mourning and somber reflection as Jews remember the destruction of the Temples and other tragic occurrences in Jewish history. I believe that this is no cosmic coincidence. It is said that in times of trouble, God provides solutions inside the problems themselves.

And so, sons and daughters of Israel and the United States, feel proud of your part in embodying this wonderful, shared legacy of the Hebrew Republic. May all of us, citizens of the modern State of Israel and citizens of that land across the ocean once called "New Israel," celebrate a happy Fourth of July.

Introducing the Two Israels Project

The English Calvinists who made the pilgrimage to early America, in order to practice tolerance and a faith denying the religious sanctioning of monarchies, considered themselves the New Israelites of their era. There are references to the colonies as "New Israel," and this is supported by the multitude of Hebrew biblical names of towns and counties. A few generations later, their descendants, the American Founders, expressed an affinity and identification with the ancient Hebrews, and King George III was widely characterized as the "Pharaoh" of the American Revolution.

On the heels of the Protestant Reformation, the 17th and 18th centuries were the highpoint of Christian Hebraism, the movement to understand the Hebrew, and sometimes even the Rabbinic, roots of Christianity. Anti-semitic beliefs and attitudes were common, but Hebrew itself was treated as a classic, seminal language for learning scripture, and prominent colleges in America required the study of Hebrew from its students. The Founders, and their political philosophical forebears in Europe, considered the governing principles mentioned in the Torah (the Five Books of Moses) and the books of the Prophets in the Old Testament as practical (, for some, even "perfect,") guidelines for the governance tof a free people.

The "Hebrew Republic" is the historical concept evoked by some American Founders, and previously by English political philosophers, when referring to the example of ancient Israel's governance. Today, two modern states, "Two Israels," may be considered philosophical legacies to the concept of the Hebrew Republic: the United States of America (, the geopolitical heir to the 250 year-old notion of "New Israel,") and the State of Israel.

In labeling the United States as one of the "Two Israels," I am not suggesting that the US has in any way replaced the Jews or the State of Israel as the embodiment of Israel. Very few Americans would even contemplate such a thing, despite the adoption by some Christian sects of "replacement theology," which argues that Christianity has replaced Judaism as the covenant of God's chosen people. I use the term only to express what might be a common philosophical inspiration, ancient Israel, in the governance of the two nations.

And so, I propose a project to discuss, explore, research, and document how the concept of the Hebrew Republic has influenced governance in Israel and the United State. What can the two grand experiments (as well as those of the individual 50 United States) teach each other? What values do they best serve? In what ways are they failing their missions and their peoples? How does an affiliation with the concept of a Hebrew Republic affect the American-Israeli alliance and navigation through geopolitics and global economics?

I hope that this "Two Israels Project" might be the start of a valuable and fruitful discourse, that we might discover and share insights which strengthen the bonds between Americans and Israelis, and which improve the value of governance in both countries.