Israel enters the final stretch of its election campaign against a turbulent backdrop. Israel’s war with Iran has yet to yield an agreement preventing Tehran from developing nuclear weapons, the arrangement on the northern border still faces serious obstacles, and Hamas’ demilitarization is hardly around the corner.
Yet for many politicians, the campaign’s defining issue is not these security and diplomatic challenges, but the “Haredi question.” The conflict over conscripting yeshiva students has prompted a broader reassessment of the relationship between Haredi society and the state.
In this atmosphere, a policy paper presented by the Israel Democracy Institute at the 2026 Eli Hurvitz Conference on Economy and Society proposes reducing public support for Haredi families according to the number of their children.
It suggests conditioning child allowances, day care subsidies, housing assistance, and child-related tax credits on maximizing earning capacity or civic participation.
The paper distinguishes between protecting children’s basic needs and publicly funding what it calls a “high-fertility pattern.”
Proposal a step backward
This proposal is a step backward. It threatens one of Israel’s unique economic strengths while overlooking the real long-term danger: Not an excess of births, but a shortage.
The demographic crisis is no longer a distant forecast. Fertility in the European Union has fallen to roughly 1.4 children per woman, well below the replacement level of 2.1. In Italy and Spain, it is near 1.2, while South Korea’s rate has fallen below one. These countries face aging populations, labor shortages, growing pressure on pension and health care systems, and diminishing prospects for long-term growth.
Population decline can create a feedback loop. As populations shrink, the burden on younger generations grows, making it harder for young couples to raise families. Governments have tried to reverse the trend with little success.
Many countries have turned to immigration as a stopgap. Yet immigration offers only a temporary solution, as immigrants tend over time to adopt the lower fertility rates of their host countries. It can also produce integration difficulties, tensions over national and religious identity, and political polarization.
Israel’s high fertility rate a boon
Europe is discovering that immigration may fill immediate labor shortages but cannot restore the social cohesion and intergenerational confidence weakened by family decline.
Japan has chosen to limit immigration to preserve social cohesion but pays a heavy economic price as its population falls by hundreds of thousands each year.
Against this backdrop, Israel is an anomaly. Its fertility rate remains close to three children per woman, making it the only Organization for Economic Co-operation and Development country safely above replacement level.
This is not a structural weakness of the Israeli economy. It is a singular strategic advantage.
