Analysis

A New Israeli Election Could Actually Save Money

Sure, it’ll cost the country another $830 million, but it can save much more in the long term if ultra-Orthodox parties can be kept out of the government

Prime Minister Benjamin Netanyahu at a Kneset meeting, May 27, 2019.
Mark Israel Sellem

Among the complaints voiced against the second Knesset election scheduled after the Knesset voted to dissolve itself Wednesday night is the effect on the public purse – another vote could cost the country 2 billion shekels ($830 million).

Yet in terms of long-term economic growth and national investment, another election was preferable anyway to forming a government that hinges on the ultra-Orthodox parties and right-wing parties willing to destroy the rule of law.

The main lesson from the failure of the coalition talks this time around is that the big parties must be strengthened even further. Prime Minister Benjamin Netanyahu failed to form a governing coalition because of the weakest links in the right-wing bloc with which he planned to form a government. The small parties that he needed are the ones bringing him down. 

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Macroeconomic research shows that the ability of a coalition with only a slender Knesset majority to advance long-term national projects is only as strong as the weakest link in the coalition. When the governing coalition lacks a strong majority, national interests are captive to a modest-sized minority – the niche party whose wishes must be granted for anything to advance.

Over the past four years, Netanyahu’s coalition cost Israeli taxpayers much more than 2 billion shekels when we consider how much was spent to win the support of partners from the ultra-Orthodox community. The Bank of Israel has warned that if ultra-Orthodox men and Arab women aren’t integrated into the workforce, Israel’s growth in annual gross domestic product will drop to 2.4% from the average topping 3% over the past decade.

The future of Israel’s economic miracle has been put at risk because of stalling efforts to integrate the ultra-Orthodox community into the workforce, which stems in part from the ultra-Orthodox parties’ strength in the right-wing bloc.

Another election, however, could change this picture. The stronger the party, the more likely it is to withstand another campaign season in the same year. If there are no last-minute changes, fewer small parties will be competing in the second election. Some politicians are already exhausted, and some small parties are joining up with larger ones.

When parties form larger political blocs, this serves the public interest. It reduces the niche parties’ ability to exploit the political system and increases the chance that economic processes of national interest can be advanced. Over the long term, this could be worth much more than the 2 billion shekels for a new election.

And what about the legitimate interests of the minority groups that lose their political strength? That’s why we have the High Court of Justice, which preserves the rights of all of Israel’s minorities.