From EconWiki
Jump to: navigation, search


Social and Economic Inequality in Israel

Israelis are known for being very liberal. According to Stephen Lendman's article about inequality in Israel, "since the early 1980s, neoliberalism began replacing New Deal/Great Society values to the detriment of millions harmed. It means markets know best so let them, liberating enterprise to move capital, goods and services freely, benefitting the few at the expense of the many."[1] The IMF states, "Public debt is high relative to stronger OECD and emerging market countries, and, reflecting regional tensions, security expenditures severely constrain room for fiscal maneuver. House prices have surged by over 50% in recent years, and notwithstanding welcome reform initiatives following the Hodek committee recommendations, structural (frailties) in the corporate bond market remain. Despite strong growth, overall poverty is among the worst in the OECD, raising sharp social and sustainability concerns, notably in the Israeli-Arab and haredi (ultra-orthodox) communities. And finally, a decade of stagnant real wages contributed to an eruption of social protests in 2011, with significant implications for spending and taxation policies over the medium term."[2]

According to the article, 1.77 million Israelis live in poverty. It also states that around 850,000 children live in poverty. As a result, "75% of those affected miss meals" which is a 21% incline from 2009. Also, 83% of poor children lack proper dental care, most getting none. "Some beg for money. Others steal to eat."

The percent of poor households headed by a wage earner rose from 43% in 1997 to nearly 58% in December 2009. The trend reflects government policy to encourage work by reducing public assistance, the objective being to elevate people from poverty.


One in every four residents in Israel lives below the poverty line, more than twice the average of Western countries (the average poverty rate in developed countries is 11.1%). Israel has the second highest poverty rate among OECD countries (OECD data, 2011). The total number of the nation’s impoverished is 1.7 million people. Groups with the highest percentage living below the poverty line are ultra-Orthodox Jews (56.9% of all families) and the Arab population (53.5% of all families.) 36.3% of Israeli children live in poverty (850,300 children). Working families make up 49% of the total population living below the poverty line (National Insurance Institute data, 2009). As of 2008, there were reports of 29% of Israelis who ran the risk of falling below the poverty line compared to that of 27% in 2000. This refers to those whose jobs are threatened or whose average monthly income divided by the number of family members is less than 2,000 shekels. This number rises sharply, to 38 percent, for Israeli children because of the proportionately larger Arab Israeli and ultra-Orthodox Jewish families who contribute to the two poorest communities in Israel. This is in contrast to that of the EU where 19% of society lives close to the poverty line. [3]

Social Gaps

Israel’s level of economic inequality is one of the highest among developed countries. In 2011, Israel was ranked fifth in unequal income distribution among the 34 OECD countries, with the United States ranking fourth and Chile ranking first (OECD data, 2011). Israel’s level of economic inequality is a remarkable 22% higher than the average in OECD countries (National Insurance Institute data, 2009).[4]

Some important aspects of Israel's society and Economic stance

  • High poverty compared to other OECD countries; [5]
  • High inequality
      "The most significant changes in 2010 were firstly, a 10 percent increase in the income of households in the top income percentile and an increase of 30 percent in the average salary bill for senior executives in the 25 largest corporations on the Tel Aviv Stock Exchange." [6]
  • Low achievement performance in international school tests; [7]
  • 75% of workers earning one-third or less than high-tech salaries (on average, about $20,400 annually); [8]
  • Eroding social benefits and safety net protections; and
  • A minority business, political and professional class (benefiting) at the expense of Israeli workers.

Important transformations needed in Israel

  • Ending the Israeli/Palestinian conflict; [9]
  • Allocating more for education for all Israelis, not just those well-off enough to afford better schools;[10]
  • Investing in all sectors of society to create more opportunities for more people, as well as new labor policies "based on workers' rights and strict, universal implementation of labor laws."


  4. < "Social and Economic Rights in Israel 2011." Association of Civil Rights in Israel, May 2011. Web. 17 Apr. 2012.

(edit) Israel has long been a well-documented country throughout the world. For starters the country is located in one of the most controversial regions in the entire world. Israel is the birthplace of not only Judaism but also Islam. Both beliefs believe that their profit originated from the region and that consequently the land is possession of the respective faiths therefore prompting both faiths to proclaim the region(the holy land). Because of the difference in belief both religions have engaged in on-going war for centuries which has been labeled by historians as the holy war or the jihad. The United States has long been an advocate for the ending of the war however, when forced to take sides we as a nation have sided with Israel for a significant amount of time now. As a result of our alliance, we have funded and aided Israel in its battle against Islamic nations and independence greatly-this task has undoubtedly cost this country millions upon millions of dollars. This excerpt explains the American and Israeli is greater detail, "The close relationship between Israel and the United States was born out of Cold War tensions projected onto the regional conflict in the Middle East. Following the 1967 war, relations between Israel and its neighbors remained tense and by 1970, Israel found itself entangled in war of attrition with its southern neighbor Egypt. The U.S., implementing its policy of containment at the time, was competing with the Soviet Union for influence in regions around the world. So when the USSR began providing Egypt with their most advanced antiaircraft system and 1,500 combat personnel,1 the U.S. responded by providing Israel with a military loan of $545 million, nearly 20 times the military aid Israel had received the previous year and twice the total military assistance Israel had received in 22 years of existence.2 The alliance between Israel and the U.S. grew stronger through the 1970s as Soviet support of Arab states continued and as regional tensions peaked during the Yom Kippur War, and that alliance remains strong today. With its $3 billion annual aid package, Israel today receives more aid on better terms than any other nation in the world."-Daniel Feith The financial demographic of Israel is interesting and relevant when discussing the country from a glance however, what is most relevant to the US in regards to the country of Israel is the billions of dollars we have spent on behalf of their safety and upkeep. Friendship is one thing, but paying for it is an entirely different thing. One just hopes Israel appreciates it.

References: "Harvard Israel Review (HIR)." Harvard Computer Society. Web. 02 May 2012. <>. " | Quick Facts: U.S.-Israel Relations." Web. 02 May 2012. <>.

()-denotes editing

Personal tools