Analysis

Israel's Economic Future Is Wasting Away in Israel’s Yeshivas

In the latest attempt to prevent the ultra-Orthodox from serving in the army, the labor force of the future is being sacrificed for short-term political calculations

A yeshiva student lights candles on the seventh night of Hanukkah in the Ultra-Orthodox city of Bnei Brak, Israel, December 18, 2017.
Jack Guez/Bloomberg

Could Moshe Leon, the man most likely to be Jerusalem’s next mayor after Tuesday’s election, also likely to be the costliest mayor in Israel’s history?

It would well be because Leon could end up being the person who, by the year 2060, will cause tens of thousands of families to fall below the poverty line as the Haredi poverty rate rises to 25%. Per capita GDP growth will be 15% lower than it should have been and the national debt will grow threefold to 170% of GDP, a rate that spells bankruptcy for the State of Israel.

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How could Leon be responsible for all this? The answer is the political deals that everyone involved in is denying to ensure his election victory on Tuesday. The trade-off is this: The ultra-Orthodox parties Shas and Degel Hatorah agree to support Leon in exchange for Leon’s patron, Defense Minister Avigdor Lieberman, softening his stance on the Haredi draft law.

Whether or not there is a deal, the fate of Israel could well be determined these days. Even if Leon loses, the pressure is on Prime Minister Benjamin Netanyahu to come to a compromise, especially as early elections loom.

If the law is passed by the Knesset according to the wording now being finalized by MK David Amsalem (Likud), the dystopian future of slow economic growth and bankruptcy, rising poverty and inequality are almost certain to come to pass.

This isn’t idle speculation; it is the forecast of the Finance Ministry’s chief economist, predicated on the assumption that the levels of education and employment among Israel’s ultra-Orthodox remain at the same low levels they are today. With the Haredi population forecast to triple as a percentage of the national population to nearly a third in 2060, it will means a huge proportion of Israelis won’t be serving in the army, won’t be getting a modern, secular education and won’t be able to fill productive jobs.

The State of Israel simply can’t survive under these conditions.

The deliberations in Amselem’s committee on Haredi army service will decide which direction Israel takes. That is because there is a strong connection between drafting Haredi men and their later integration into the labor market.

If the government abandons targets for drafting more Haredi men and the sanctions that are supposed to be imposed on yeshivot that don’t comply are softened, the effect on the economy will be profound. It will be even worse if the age is raised at which young ultra-Orthodox men can stop studying and go into the labor force with the threat of being drafted.

As it is, the proposed legislation Amselem started with was a compromise that sought to provide enough recruits for the army without upsetting Haredi leaders too much. The annual threshold for the minimum number of Haredi draftees was hardly challenging, in fact it was even lower that the rate of growth right now. It’s now likely that the legislation will be watered down even more as it winds through Amselem’s committee.

The idea that “he who doesn’t serve also won’t work” was enshrined in the Tal Law nearly two decades ago that sought to use the stick of unemployment to coax ultra-Orthodox men into the army. In fact, the real victim was secular Israelis, who ended up subsidizing the lives of the Haredi population: We educated the men to sit in a yeshiva all day at our expense.

The formula of “no army service, no work” should be dispensed with, but the pending legislation sustains it by setting the age at which a Haredi man is free to enter the labor market at 24. That means those who don’t enlist must remain in the yeshiva till that age. They can only pursue a general education after that age, delaying their entry into the labor market.

Forcing ultra-Orthodox men to remain in the yeshiva until that age is the current situation and the result is that only half of them are in the workforce, versus 88% for non-Haredi Israeli males. Those among the ultra-Orthodox who do work have low rates of productivity.

The cost of this system comes in an equation calculated by Yohanan Plesner, Gilad Malach and Prof. Amichai Cohen of the Israel Democracy Institute. They found that in order to get 417 Haredi draftees every year, some 14,000 Haredi men ages 22-24 are stuck in yeshivot.

Whether it’s a local one for Jerusalem or a national one, the deal means the Knesset debate will be go quickly without lawmakers spending the time to understand and weigh the impact of the law they are voting on. Those behind the scenes will be working to water it down.

What will be left is to save the labor market by enabling the ultra-Orthodox to learn secular subjects like math, science and English and get technical and professional training while they are in the yeshiva. That may happen, at least, when they are free to leave they will have workplace skills and not have to learn the three Rs at age 24. Lowering the exemption age to 22 would help, too.

Many will object that this will violate the principle of equal burden, but the threat facing Israel is to immense to let that delay a solution.