Here's an article from Amnon Rubinstein, former Meretz MK (so judge accordingly), titled "The next looming demographic disaster." In the article, he mainly argues against the restoration of child benefit payments to the pre-Netanyahu levels. Though I agree with him in that regard, I agree with him for a different reason. Namely, not for the effects of the decreased birthrates after Netanyahu cut the benefets, but for the promotion of the market economy in Israel and move away from the socialist economy.
What I want to bring to attention is the following. Rubinstein says that with the higher birthrate among Hareidim and Arabs, compared to the rest of Israeli population, by 2025, there'll be a higher percentage of people on welfare (namely, Hareidim and Arabs), and lower percentage of people who are supporting those on welfare, regardless of child payment legislation. Even though he writes that restoring the previous levels of child support "may alleviate distress in the short term among large, low-income families, it means a future of growing poverty and recession for Israel's economy", I don't see how the same scenario would not apply in a slightly longer term if the child support payments do not increase.
Thus, what will happen 20 years from now? The answer is unclear, however, I don't think that current situation will remain at status quo.
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4 comments:
I wonder if such analysis has been done in American observant community? Since welfare is provided by government, the only thing to analyze would be school tuition. It would be interesting to see a projection of private school cost in the future and general trends in the level of subsidies in recent years.
In principal I agree with Rubinstein: in a long run market economy would minimize poverty better then even well meaning government.
However I would be curious to see what is the total amount the state of Israel is spending on welfare, and whether it is more than $3 Billion annual welfare payment the state of Israel receives from the U.S.
The difficulty is that the reason Chareidim and Arabs have large families is not to take advantage of welfare benefits but for religious and cultural reasons. Cut out child benefits entirely and charge women $599.99 to give birth and they will have as many kids as before, just they'll be further in debt. Really, the Israelis should restore the payments but link them to a return of some kind, probably through national service, on the part of the beneficieries. Any attempt to use yeshivah as a deferrment would cause the money to come due immediately.
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