Israel has never benefitted from the kind of political-economic circumstances that are favorable to the creation of a full-fledged welfare state.

Still, the first decades of statehood were characterized, among others, by attempts to develop social welfare services based on the Scandinavian social-democratic model of the time: one that would provide subsidies, services and/or cash payments to citizens who were in need due to unemployment, lack of training, parenthood, illness, injury, age or other permanent or changing life circumstances. The creation of a welfare state was part and parcel of the very nation-building process.

It took some 30 years to finalize the process of social welfare legislation, with the passage of the Long-Term Care Act in 1982.

It took only three years before the process of dis-investment was initiated by adherents of neo-liberalism.

Israel’s financial crisis of 1985, which provided the impetus for the Economic Stabilization Program, involving, among others, budget cuts, privatization of public services and tax reductions[1] — as well as subsequent events, notably the Second Intifada (2000-2005), led to retrenchment of the social-democratic model, in favor of a very different model, one that had already taken hold in the United Kingdom and the United States: a neo-liberal model. As is well known, social services are financed by taxation or other sources of government income. While the social-democratic model is based on relatively high, progressive taxation, the neo-liberal model aspires to low taxation and minimal public services, especially social welfare services. It favors small government and big business.

In Israel, 2002 marked the decisive victory of what has come to resemble the neoliberal model of a welfare state, over the more generous, social-democratic model — against the background of the second Intifada, increased terrorist activity, an economic crisis, and what Maron and Shalev[2] term “an unusually favorable government coalition,” which provided the political opportunity for the Ministry of Finance to impose cuts and limitations on many cash benefits.

Under the new model, potential recipients of “social welfare services” no longer referred to the majority of the population, who, in accordance with the idea of social-democracy were to receive from the state or the local authority services, subsidies and monetary transfers in accordance with need; rather, “social welfare services” (not including social security) were to be limited primarily to individuals and families located at the bottom of the income ladder and who lacked the wherewithal to benefit from a reasonable standard of living.

The October 7, 2023 massacre and Israel’s subsequent invasion of Gaza, among others, have made many Israelis aware that the time has come for changes that will benefit all citizens, especially those at the bottom of the income ladder (let us say, the bottom 10%) in times of peace, as well as all those adversely affected in times of hostility or crisis. The only way to bring about such change is to require the top 10% to contribute more to the general welfare of their countrymen and women.