Netanyahu-Lapid Alliance May Force More Haredim Into Workforce

An Israeli government anchored by Prime Minister Benjamin Netanyahu and newcomer Yair Lapid may force more ultra-Orthodox men to take jobs, which central bank Governor Stanley Fischer says is key to a stronger economy.

Lapid, whose Yesh Atid party came second in Israel’s national election, made it almost certain yesterday that Netanyahu will serve a third term and address the employment issue. The popular 49-year-old television host pledged not to join the prime minister’s opponents who seek to block him from assembling a 61-seat majority in Israel’s 120-member Knesset.

“I want to get rid of this idea,” Lapid told reporters outside his Tel Aviv home, in remarks broadcast by Channel 2. He said he was pleased Netanyahu spoke about the need for all citizens to “share the burden” of army service and discussed the plight of Israel’s middle class, Lapid’s banner issues.

The low employment rate of ultra-Orthodox men -- known as haredim in Hebrew -- has prompted Fischer to warn repeatedly that the current arrangement is “not sustainable.” Under a system that dates back to the early days after Israel’s founding in 1948, haredi men are permitted to defer military service as long as they study full-time in religious seminaries, known as yeshivas. The majority remain in yeshiva until they are married and have several children, allowing them a permanent deferment from the armed forces.

Military Deferments

Lapid’s plan to eliminate military draft deferments for the haredim and boost their labor participation could be foiled if Netanyahu decides to bring the ultra-Orthodox parties into the new coalition he wants to assemble, said Itzhak Galnoor, a political scientist at Hebrew University of Jerusalem.

“The dramatic change would be if they would be left out,” he said. “If Mr. Lapid will be part of the coalition, the question is if it will be possible at all to have them as coalition partners.”

Lapid campaigned on domestic issues he says are crucial to Israel’s middle class. These include “sharing national responsibilities” and “equal service for all,” a reference to the draft deferments for ultra-religious men and their low employment rate.

While the Ashkenazi ultra-Orthodox United Torah Judaism party, which won seven seats, has remained in the opposition to some governments, the Sephardi Shas party, which won 11 seats, has been included in every coalition except one in the past 30 years, Galnoor said. If Shas is in the coalition, a compromise will probably be reached, and changes to the draft arrangements for the ultra-Orthodox will be less dramatic, he said.

Netanyahu Coalition

Yesh Atid, Hebrew for “there is a future,” won 19 parliament seats, more than any opinion poll predicted and second only to Netanyahu’s Likud-Beitenu. The prime minister’s party won 31 seats and will need other parties to build a majority coalition in the Knesset.

Lapid says he entered politics in part to carry on the legacy of his late father. Tommy Lapid, who died in 2008, was also a journalist and broadcaster whose now-defunct Shinui party won 15 seats in the 2003 election. Before imploding amid internal conflicts, Shinui supported the government of Prime Minister Ariel Sharon in reducing child allowances for large ultra-Orthodox families.

Lapid’s platform calls for a five-year interim period during which ultra-Orthodox men would be allowed to work with no requirement of army service. During this period, the government would develop programs to facilitate the service of much larger numbers of ultra-Orthodox in the army and in civilian national service. After five years, all would be drafted.

“We have the opportunity to do very big things for the State of Israel,” Netanyahu told Lapid after the vote, according to comments posted on the prime minister’s Facebook page.

To contact the reporters on this story: Alisa Odenheimer in Jerusalem at aodenheimer@bloomberg.net; Jonathan Ferziger in Tel Aviv at jferziger@bloomberg.net

To contact the editor responsible for this story: Andrew J. Barden at barden@bloomberg.net

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