Israeli kibbutz is global competitor

NAHARIYA, Israel - A few kilometers up in the piney hills toward the Lebanon border from this seaside resort is an industry that crosses lots of boundaries. Not just national boundaries. Technological, too. And more emphatically yet, ideological. It's a socialist industry, to call a spade a spade. But it got its start on made-in-U.S.A. technology, and it's holding its own, as it must, in free market competition.

Hanita Coatings is one of two manufacturing enterprises in an Israeli 'kibbutz,' a communal settlement that put down roots before World War II, paid for its acreage with money - and blood - and seems a reasonable candidate to prosper in a high-tech century.

Cows amble out onto the winding road that leads up, higher than Pittsburgh's Mt. Washington, to lofty Hanita, whose red-roofed homes have back patio views of the blue Mediterranean to the west.

Clumps of bananas grow from thousands of trees in a plantation that was nothing more than a group of brushy, rocky hillsides before desperate Jewish settlers got here in 1936.

Kibbutz Hanita's original missions were, first, survival; second, a subsistence agriculture.

But for years now the community's owners, members as they are termed, in a total population with kids and retirees of about 600, have made manufacturing their economic spearhead.

True to the original all-for-one-one-for-all spirit of the place, the members' salaries as factory workers aren't paid to them but to the community. Then their incomes are distributed on a basis related to family needs.

To American ears it doesn't sound like a system that could last more than two weeks, much less two generations; and many a kibbutz, it's said, has lost its focus and its ambitious youth. Hanita seems to be making it, in part by taking in paying guests. Tourism's a big part of the Israeli economy, hurting right now as it happens.

But homegrown manufacturing is prospering and hiring.

'Our annual volume is over $20 million now and has about doubled in the past five years. And since Israel's local market is small, 90 percent of the production is exported,' Leon Davids told a visitor to Hanita Coatings.

Davids is the company's area export manager, a Jewish South African who 'made aliyah,' that is, 'came home' to Israel.

He said the company specializes in metallizing, or otherwise coating, very clear polyester plastic sheets. With what results• Well, to provide superior surfaces for printing beer bottle labels, for example. Or to make catchy packaging for cosmetics and pharmaceuticals.

A big market is the coating of window glass to keep the sun out or to retain a building's warmth in winter. Comfort and energy conservation coincide right there.

But the fastest-growing market - you guessed it, this being Israel - is the bombproofing of the most vulnerable part of any building, the windows.

Davids showed impressive panes that have held up through test explosions a yard or two away. They don't come through unscathed, but they don't shatter. Glass daggers don't scatter in all directions. Rather, they look like U.S. safety windshields after an auto accident - and this against bombs!

It's a market that's the child of terrorism around the globe. Natural customers are embassies, corporate offices, trade centers, many places flying the American flag.

Only a few days after the plant visit, the peace of the kibbutz was shattered by violence 200 miles southward towards Egypt. An adopted son of Hanita, Police Sgt. Yonatan Vermullen, 29, and another Israeli were killed by a terrorist bomb at a border crossing in the Gaza Strip. Vermullen's funeral in the kibbutz burial ground was beamed by television throughout an Israel that balances daily between peace as a hope and terrorism as a reality that can break out anytime, anywhere.

Hanita Coatings' various product lines compete against six manufacturers worldwide, Davids said. 'All the majors are in the U.S.,' he said. In fact, the company was launched by technology transfer from a U.S. company in 1985, but today the ownership is 100 percent kibbutz-held. Davids didn't name the U.S. firm whose labs put the kibbutz on the leading technical edge, but a visiting Pittsburgher's guess, that it might have been PPG Industries, was wrong.

Consolation prize, though. Another western Pennsylvania household name, the Latrobe area's Kennametal Inc., has a plant that makes metal-cutting tools just down the hill from the kibbutz. It's near a new town of winding streets, red-tiled roofs - and backyard bomb shelters - called Shelomi.

As Davids explained it, some 40 percent of the kibbutz members are employed in services that just keep the kibbutz going: food preparation (there's a communal dining hall), building maintenance, schoolteaching and the like. The others work at agriculture, tourist hospitality, the coatings plant or the other factory in town, Hanita Lenses (which makes contact lenses and implants for patients of cataract surgery).

The coatings plant employs just under 100 people, not all from the kibbutz; the latter are paid conventionally - into their own pockets. Davids himself is not a kibbutz member. On the other hand, some kibbutz members have jobs in the larger community, and their salaries go back to the kibbutz.

Obviously, it's a very mixed system, with vestiges of the 'pure' socialism of old and many compromises with the demands of free markets.

Jack Markowitz is spending several weeks in Israel as a 'Volunteer for Israel,' a government-sponsored program in which men and women perform civilian work at Israeli defense posts and hospitals. The program has involved thousands of volunteers over the years, mostly from the United States, and Christians as well as Jews. Tasks include kitchen duty, warehouse labor, construction, painting and gardening, but not direct military operations.