Answer

There are several problems. The first is that the rabbis are not chosen based on their quality, but for political reasons and by politicians (usually from Shas). They do not have the slightest interest in religious services. These are jobs handed out to their people and to their crime families (Lao, Deri, Yosef).
If there is a good rabbi among them, then of course that can happen, but that does not justify adding hundreds and thousands of positions in which the Shas minister sets salaries and passes them on to his own people.
Beyond that, a community that wants a rabbi is welcome to support him and choose whomever it wants. The state should not choose rabbis and should not employ them.
There are already city rabbis (a role that is itself unnecessary), and there are community rabbis for communities that want them. There is no need for neighborhood rabbis.
It seems to me that anyone who does not understand the nature of this corrupt law is either blind or blinding himself for his own reasons.