The fundamental challenges facing Israel’s economy are also the fundamental challenges facing Israeli society. Everything is connected.
Meaningful change therefore requires a broad national strategy. Israel must move beyond firefighting, temporary fixes and short-term political solutions – toward a professional, courageous and comprehensive economic plan built around one guiding principle:
Those who work, serve and contribute should be prioritized and rewarded.
Three Fundamental Challenges Facing Israel’s Economy
Unequal Sharing of the Burden
A relatively small segment of Israeli society carries a disproportionate share of the country’s economic and security burden, while entire sectors remain outside the workforce and national service.
The Cost of Living
Israel’s middle class is being squeezed. Young adults increasingly depend on their parents to make ends meet, while deep economic disparities remain between the center of the country and the periphery.
The Economic Consequences of War
The war has dramatically increased defense spending while causing severe damage to infrastructure, communities and towns throughout Israel’s North and South.
Israel Is at a Crossroads
Either the Economic Model Breaks Down, or We Fundamentally Change It
The profound rupture of October 7 must serve as a wake-up call.
Israel can no longer manage its economy through temporary arrangements, political compromises and short-term fixes.
The challenges we face are not separate crises. They are different manifestations of the same underlying problem: a country that has responded to immediate political pressures instead of building an economic structure that rewards contribution and uses its resources effectively.
Israel’s economy has repeatedly demonstrated its strength and resilience. It has survived extraordinary shocks and continued moving forward.
But we cannot build Israel’s future on hope and miracles.
While many Western economies are struggling to break through a ceiling on economic growth, Israel has enormous untapped potential.
Managed professionally, responsibly and fairly, these growth engines can secure the future of Israel’s economy and Israeli society.
The Yashar! Path Forward
Yashar! believes in an economy built on mutual responsibility between citizens and the state.
Those who work, serve and contribute should be prioritized and receive what they deserve. In return, the state must remove unnecessary barriers, correct distortions and provide high-quality services that enable its citizens to succeed.
Our vision for Israel in 2048 is a thriving middle class and one of the world’s leading economies — not despite Israel’s demographic diversity, but because of it.
Haredim, Arabs, young Israelis from cities and towns across the country — everyone should play an active and meaningful role in Israel’s prosperity.
Within a decade, young Israelis should no longer need financial support from their parents simply to make ends meet.
Israel should become a country that realizes the potential of all its citizens, significantly reduces the cost of living and transforms the periphery from a distant extension of the center into an independent engine of economic growth.
Our goal is simple:
To make Israel the best place to live, work and raise a family.
The tasks ahead are complex and will require public courage. We can accomplish them — and we are committed to doing so.
Rights Come with Responsibilities
We will put Israel’s working middle class, young people and those who serve the country at the center of economic policy.
Government assistance programs, housing benefits and childcare subsidies will prioritize reservists and working, productive families.
We will reform the tax system so that tax credits and benefits reward those who carry Israel’s economic and security burden.
And we will ensure that working always pays more than relying on benefits.
The principle is straightforward:
Those who contribute should be rewarded.
This is not only a new social contract between citizens and the state. It is also a powerful economic incentive for long-term change and for greater participation of all sectors of Israeli society in the workforce.
An Uncompromising Fight Against the Cost of Living
Reducing Israel’s cost of living requires more than one reform. It requires sustained action across the economy.
We will remove unjustified import barriers and Israel-specific standards and open the market to greater parallel imports.
We will act to reduce the power of concentrated market groups in the food and consumer-goods sectors, while continuing to protect and encourage Israeli agriculture.
We will reform kosher certification and the import of kosher products.
We will promote structural reforms and greater decentralization in highly concentrated sectors of the economy.
We will reduce the bureaucratic burden — and its cost — for manufacturers and importers, while removing barriers that prevent foreign companies and new competitors from entering the Israeli market.
We will also fight organized crime and protection rackets that suffocate small businesses and ultimately increase prices for consumers.
The fight against the cost of living must extend across every major area of household expenditure:
housing, food, water, energy, healthcare, leisure, clothing and footwear, transportation, communications, furniture, home maintenance and more.
There is no single magic solution. Meaningful change requires systematic, sustained implementation of dozens of structural and targeted reforms.
Yashar! intends to carry them out.
Lower Taxes and Fight the Shadow Economy
We will reduce income taxes while introducing targeted taxes on products with clear negative externalities, such as disposable products and sugary drinks.
We will also reform eligibility for government benefits.
Municipal tax discounts, tax exemptions and welfare benefits will be based on socioeconomic circumstances and the full realization of earning potential — rather than sectoral affiliation.
