Moshe Rivlin, director general of the Jewish Agency, told a United Jewish Appeal delegation of prominent New Jersey businessmen here that “For the first time in Israel’s history there is no money for development.” Stressing Israel’s economic problems. he also told them that “Last year we did not get the money we were expecting from the UJA and the Bonds.”
The visitors heard a similarly sobering report on Israel’s deteriorating economy from Minister of Commerce and Industry Haim Barlev and Haim Ben-Shahar, president of Tel Aviv University and one of Israel’s leading economists. Ben-Shahar, whose special committee last year drafted Israel’s tax reform bill, said the country now faced one of the most crucial periods in its economic history.
He said that for the first time, the government was forced to introduce cuts in defense spending even though they meant the armed forces would have to do without vital equipment. “If we spent as much as we should (for defense) it would ruin the economy,” Prof. Ben-Shahar said.
BASIC PROBLEM CITED
Barley said that Israel could not use unemployment as a weapon against inflation because that would deter aliya and create dangerous social unrest in the country. The basic problem is that Israel, with its extraordinary defense needs, consumes 30 percent more than it produces, the Minister said.
Barley said the government was trying to narrow the consumption-production gap by increasing production, decreasing consumption, and mobilizing reserves from abroad. He said that by the end of this year consumption, already reduced five percent, would be down eight percent from the pre-Yom Kippur War level.
Asked by the UJA mission members how they could help, Barley said that, over and above UJA donations, they could assist Israel the most by stimulating its exports, meaning the purchase of Israeli goods. He cited the example of the Jewish owned British department store chain, Marks and Spencer, which, he said, bought Israeli foods and textiles on a strictly business basis
The Archive of the Jewish Telegraphic Agency includes articles published from 1923 to 2008. Archive stories reflect the journalistic standards and practices of the time they were published.
