Immediately after the March election, when Moshe Kahlon became the prime candidate to become finance minister, it was noted he was inheriting a budget in reasonable shape, and would have to make relatively moderate cuts of 8 billion shekels ($2.1 billion) to maintain the deficit framework. The situation has been transformed since then. Prime Minister Benjamin Netanyahu has lavished additions totaling some 7 billion shekels on his coalition partners, meaning that now some 15 billion shekels must be cut from elsewhere to avoid a large and dangerous budget deficit. This situation emerged because the ultra-Orthodox parties hit the jackpot.
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Under United Torah Judaism’s coalition agreement with Likud, the cut in child allowances made in 2013 will be canceled, returning these allowances to the previous level of 2.6 billion shekels. Yeshiva budgets and allocations to kollel (married yeshiva) students will cost half a billion shekels, while guaranteed income payments to these students will be restored. A new version of the so-called Nahari Law will be passed, so that Haredi schools not teaching the core curriculum or subject to state supervision will be funded as if they are part of the state educational system.
The ultra-Orthodox success creates not just a budgetary problem, but a social and cultural one. When child allowances and kollel allocations were cut, Haredi men had more of an incentive to leave yeshivas and join the workforce. Now, with the decision to give more to anyone who spends his day in yeshiva, the desire to work will drop and the attraction of kollel will grow. Canceling criminal sanctions against Haredi youths who evade the draft while secular draft-dodgers are sent to jail is a social injustice that discriminates among young Israeli men.
The Haredim are also liable to force adverse changes in the realms of conversion, burial and marriage, bringing Israel closer to the model of an undeveloped theocracy where religion reigns, rather than the values of humanism, progress and democracy.
On top of the commitments Netanyahu made to the Haredim, one must also add promises of zero VAT on staple items; free dental treatment up to age 18; implementing the Alalouf Report on fighting poverty; increasing soldiers’ salaries; and additions to education and settlements. Consequently, Israel is facing a huge budget deficit that will require deep cuts in various education and welfare budgets, as well as cuts to infrastructure funding and higher taxes. The ones who will bear this burden are those who serve in the army and pay taxes – a public Netanyahu has sacrificed to establish his fourth government.