Israeli labor and management were warned today against allowing prices to rise unnecessarily. The warning was issued after an emergency meeting of the Ministerial Committee on Economic Affairs and representatives of Histadrut, the Israeli Labor Federation; the employers’ associations, and the cooperative movement. They decided that the prices of basic foodstuffs–including bread, frozen meat, sugar and oil–should not be allowed to rise at all and that all other rises must be justified by proof of increased costs.
The meeting was requested by Histadrut general secretary Yitzhak Ben-Aharon, the former Cabinet minister who led the drive to merge the country’s labor parties into a single alignment. He was worried by galloping price increases, which have put Histadrut and employers under heavy pressure to raise salaries. Finance Minister Pinhas Sapir warned that Israel was in danger of pricing itself out of the world market, a development that he said would require still heavier taxes to siphon off excess purchasing power and direct the cash flow into the subsidization of exports. The Cabinet ministers, employers and workers will continue to meet on the issue.
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