Eban Rejects View That Israel is Not Doing Enough to Reduce Its Inflation and Its Deficit Economy

Abba Eban, chairman of the Knesset’s Foreign Affairs and Defense Committee, rejected today what he said was the view of some American economists that Israel is not doing enough to cut the size of its government in the effort to reduce inflation and its deficit economy.

Speaking at the 26th annual policy conference of the American Israel Public Affairs Committee (AIPAC) at the Hyatt Regency Crystal City Hotel here, Eban said the government and Knesset have displayed “courage” in cutting defense appropriations despite the continuing threats that Israel faces.

But Eban stressed that while Israel is taking “painful” steps to cut spending by consumers and government, “we cannot do this alone” but require the U.S. to provide even more aid “than the generous” funds it does now.

“If Israel is economically weak, it cannot be militarily strong,” he declared. “If Israel is militarily weak, we cannot defend ourselves against pressures and influences which might be brought to bear upon our most vital interest.”

ISRAEL’S ECONOMY ‘IS A SUCCESS STORY’

At the same time, Eban stressed that “Israel’s economy is a success story,” not a failure. He noted that when AIPAC was founded, Israel was earning $70 million from exports while today the figure is $12-$13 billion.

“We are a success story as a producer,” Eban said. “Unfortunately we are also very successful in consuming.” But, he noted, under Israel’s austerity programs, Israeli consumers have had restrictions placed upon them.

However, he stressed that Israel’s economic problems cannot be conquered by the consumer alone, but “require a diminution of government expenditures.”

Earlier, Eban noted that his job as a Knesset chairman has been compared in the U.S. to the jobs of the chairmen of the Senate Foreign Relations Committee, the House Foreign Affairs Committee and the Senate and House Armed Services Committees. “It takes four chairman in the U.S. to do what is expected of one man in Israel,” he quipped. “Yet we hear complaints about our bureaucratic inflation.”

As a Labor MK, Eban said he had been “apprehensive” about the unity of the Labor-Likud coalition government. But, he said, although no one on either side has changed basic positions, the government would not have been able to take the austerity measures if it had not been united.

ECONOMIC FUTURE OF ISRAEL

Eban said that Israel’s economic future depends on scientific and technological advances which is why he supports Israel accepting the U.S. offer to participate in research and development of the Strategic Defense Initiative (SDI), popularly known as “Star Wars.”

Stressing that he does not want to get into the U.S. controversy over this issue, he said that was “no reason for Israel to exempt itself from useful scientific research and technical imagination” that might emerge from the program.

U.S.-ISRAEL RELATIONS IS A ‘HARMONY OF INTERESTS’

Speaking about U.S.-Israel relations, Eban said the “harmony of interests” which now exists between the two countries was expressed by Secretary of State George Shultz’s appearance before AIPAC yesterday. “I have never heard a broader area of agreement and common interests enunciated at such a high level,” the former Israeli Foreign Minister said.

Eban said that where once U.S. support for Israel was based on common values, today they also include shared national interests. “We also count for something in the balance of regional power,” he said, adding that without Israel, the U.S. position in the Middle East “would look very slender and very fragile.”

Eban said he tells both Jewish and non-Jewish Americans that “today to support Israel’s cause you do not have to love Israel. It is enough that you should love America.”