Well, it turns out that the authors' statistics were misleading, and in some ways incorrect.
Yogev Karasenty and Shmuel Rosner respond to the article, also in FP:
We should start with this simple statement: There are not a "million missing Israelis." A study conducted under the auspices of our think tank, the Jewish People Policy Institute -- one that has not yet been released but will be published in a couple of weeks -- will put the real number of "missing" Israelis at a much lower number. According to Israel's Bureau of Statistics, since the establishment of the state up until the end of 2008, 674,000 Israelis left the country and did not return after more than a year abroad. An unknown number, estimated to be between 102,000 and 131,000, have died since, putting the number of living Israelis abroad at the end of 2008 at 543,000 to 572,000.It goes on from there, including the fact that many of the "yordim" were Soviet Jews who were in Israel only a short time on their way to the US. And 100,000 others are Arabs.
Which makes the truth a bit less scary than the original story claimed.
Read the whole thing.