The state budget
An out-of-control train is leading us to the abyss
The 2023-2024 budget for the State of Israel has passed. Beyond the disputes within the coalition, each party pulled in its own direction to try and get a bigger slice of the cake. Beyond the numbers and charts, and the headlines, the budget book tells a story in which numbers, unlike words, cannot lie and the story does not have a happy ending.
To simplify the picture without having to dive into the numbers, imagine you have a sum of money in the bank today that you would like to use for investment. After carefully looking over your bank statement, which includes your expenses and revenues, you search for the investment options that can deliver a maximum return.
Your goal is to take care of your children’s future; their education, their weddings, or to help them buy an apartment. At the same time, you want to make sure that your retirement is also taken care of.
If we seek to apply this same logic to the budget passed by the Knesset we will see that the current government has its own rules. If the train continues at high speed down the current route, we will all end up in the abyss. Or to put it differently, everyone gets wet when it rains.
The state budget for 2023 is NIS 484 billion, with NIS 514 billion earmarked for 2024. Before we look at where the money is going, and who the state has chosen to invest in, let’s recollect where the money comes from.
The bulk of the budget comes from us, the citizens – who work and carry the burden on our shoulders – with about NIS 300 billion in state revenue coming from taxes. The equation is simple: The less economic ability Israel’s citizens have, the greater the harm to the State of Israel – and that is without even addressing the issue of risk-averse investors, who have identified problematic trends and are pulling their money out.
The chief economist at the Finance Ministry, Shira Greenberg, recently released a report warning of the dire consequences for the Israeli economy resulting from the way the
budget is distributed. Among other things, she wrote that these decisions would increase the gaps in Israeli society and discourage people from joining the labor market.
Greenberg referred to the fact that growth in Israel is expected to fall by 3.1% in 2023 and that State revenues are expected to be NIS 5.3 billion short of the original forecast. The loss of GDP resulting from the failure to employ the ultra-Orthodox will hit NIS 6.7 trillion over the coming decades; inflation will exceed the annual target; and the uncertainty produced by the judicial reform may also exacerbate the current situation.
Greenberg is a professional
appointment and she is looking at the numbers with great concern while asking the government to bring the train to a stop. Yet instead of pulling the brakes, it is rushing ahead. The ultra-Orthodox party leaders who have become accustomed over the years to the patent of someone else carrying the economic burden are insatiable. Appetite comes with eating.
Where is the money going? Billions of shekels will go to yeshivas and other Torah institutions. Married religious scholars will receive an additional NIS 125m. A further NIS 600m. is earmarked for Orthodox culture, supporting programs that encourage adhesion to the halachic laws of taharat hamishpaha (“family purity”). Half a billion will go to religious state education budgets, and NIS 279m. to the Religious Affairs Ministry – of which NIS 67m. is allocated to hire more rabbis.
NIS 4m. will go toward paying for religious legal rulings for overseas communities (Yes, you read that correctly.). Religious institutions that are exempt from teaching the core curriculum will also receive millions of shekels in additional budgets.
What about the middle class, you may ask? Where has the promise of free education for children ages 0-3 gone? What about the cost of living? Investment in the geographic and economic periphery? Strengthening the Negev and Galilee regions? Reinforcing border communities against rocket threats? Domestic security? Providing for the elderly, and for students? Directing resources to economic growth engines such as hi-tech and artificial intelligence? The answer to all these questions will surely be that Israel is a Jewish state and that without its wise religious scholars, we have no right to exist.
Those who provide that answer, however, will forget to mention that an economy that lacks bread will also have no Torah.