Abstract
The discussion about privatization processes rarely addresses the impact these widespread phenomena have on “Civil Society” and on societal attributes that affect not only the relations between government and citizen, but more importantly, the nature of democracy itself. This chapter examines the dubious legacy of the non-profit sector in Israel, which adversely affected the trust it was able to generate. It then demonstrates how the privatization process encouraged the formation of large non-profit organizations that invested in their managerial abilities to compete successfully with for-profit organizations for government tenders, while neglecting their previously praised features of innovation and entrepreneurship. This, in turn, curtailed the ability of non-profit organizations to act effectively as social change organization or to contribute to a flourishing civil society.
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