The old Histadrut was founded as a welfare agency, employed about one-third of the Israeli labour force and was the dominant health service provider, being primarily funded by insurance premiums. A socialist entity, the Histadrut was politically and economically linked to the Labour Party which helped fund it while in government. In 1994, a new leader -Haim Ramon -was elected. He transformed the Histadrut into a confederation of autonomous labour unions, selling off Histadrut enterprises and

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... ets to private investors and severing all political ties. The Histadrut underwent a downsizing and focused on trade union goals. A year later, Ramon resigned from the Histadrut. This article explores the transformation and Ramon's political objectives and orientation, concluding that the Histadrut, already in a position of corruption and weakness, and experiencing a loss of political and organisational legitimacy, has been heavily damaged by this period. Trade unions may be going through problems of downsizing and decline but the key to survival is a leader who believes in the concept of empowerment.