American securities look so good to Palestine residents that they are sending their money to the United States to invest in them.
And that, in the opinion of the influential labor Zionist daily Davar, is a contributing factor to what is beginning to be described here as a depression.
A swiftly growing country as the result of the steady flow of Jewish immigration, Palestine has been held up as one of the few depression-free spots in a depression-ridden world.
But today there are multiplying indications that the boom–reminiscent of that which characterized America in its early days–has, at least temporarily, run its course.
Less than a year ago, unemployment, for example, was foreign to Palestine.
Today the word is beginning to creep into the speeches and writings of the country’s leaders. Thus, writing in Boustenai, organ of the Jewish Farmers’ Association, Moshe Smilansky, president of the association and a famous pioneer, declares it is impossible to expect orange planters to absorb the unemployed Jewish workers when orange prices are falling.
Equally significant is the fact that, spurred by the African war scare, there have been runs on banks. While the incipient panic engendered by the war and the bank-runs has been allayed, that the financial picture is not entirely as serene as it appears from the huge surplus reported by the Palestine treasury, is indicated in a step reported to have been taken by Barclays Bank. The bank is said to have taken over $2,500,000 in securities held by the hard-hit smaller banks with the Palestine Government backing Barclays as guarantor.
Other acknowledged and disturbing depression symptoms include the following:
Individuals and banks have tightened credit. It has become increasingly difficult to obtain mortgage loans, of primary importance to the building industry. As a result, building operations have fallen off.
According to Davar, other causes contributing to the economic crisis the country is experiencing are:
The departure from Palestine last Summer, for purely “snobbish” reasons, of 20,000 persons who took out of the country with them approximately $7,500,000 which might otherwise have been invested in industry, commerce and building. Because of foreign competition and the failure to adjust Palestine tariffs to new conditions, industry has proved unattractive to new investors.
Davar deplores, in this connection, the fact that Zionist leaders have concentrated on political leadership and have not recognized the need for financial and economic leadership.
Another indication held disturbing in some quarters is the fact that the Government has allotted only 4,350 immigration certificates to Jews for the forthcoming six months, the lowest allotment in several years. It is pointed out that the significance of this decrease is that the flow of immigration is regulated by what the High Commissioner deems to be the economic absorptive capacity of the country.