Premier Yitzhak Rabin has expressed confidence that the United States will continue to provide military and economic aid to Israel and that there will be no substantial change in America’s political position on the Middle East, although he conceded that there are differences with Washington that must be resolved before it is possible to progress toward peace in the Middle East.
Rabin made those points in an interview published Friday in Maariv, “Arms shipments from the U.S. according to signed agreements with the U.S. continue to arrive and will continue to arrive,” he said. He also predicted that after the Geneva conference ends there will have to be a renewed round of bilateral talks with Egypt to achieve a partial settlement. Observers noted that Rabin was indicating that the Geneva talks cannot be viewed as imposing a settlement on Israel but only as paving the way for future bilateral talks.
On the issue of American economic aid, Rabin said: “We shall get more than we have received until now, but it is logical to assume that we shall not get all that we have asked.”
Rabin said Egyptian President Anwar Sadat was convinced during the recent bilateral talks that the U.S. would be able to extract far-reaching political concessions from Israel without any political steps on his part. He said Sadat derived that belief from the fact that the U.S. had intervened to save the Egyptian Third Army when it was surrounded by Israeli forces in the Yom Kippur War–something the Russians were unable to do.
ECONOMISTS LESS OPTIMISTIC
A less optimistic outlook has been expressed by leading economists who are urging the government to adopt contingency plans predicated on a substantial reduction of U.S. economic aid, Shimshon Ehrlich, the senior economic analyst of Haaretz, wrote Friday.
According to Ehrlich, economists employed by the government foresee a cut of as much as a half billion dollars in economic assistance from the U.S. which would immediately throw 100,000 Israelis out of work, more than 18 percent of the nation’s labor force. Ehrlich noted that this assessment was even gloomier than a previous one made by the Bank of Israel which calculated that a drop in American aid would result in 60-70,000 unemployed.
Ehrlich reported that the economists assume that every dollar less received by Israel would mean IL 14 less production, A cut of a half billion dollars from the U.S. would equal a IL 7 billion production deficit in Israel representing 13 percent of all local production and employment. The writer pointed out that Israel’s imports amount to $7 billion annually against exports of only $3.8 billion and the deficit must be covered by loans, grants and aid funds from abroad.
Economic circles are demanding that the government appoint an ad hoc committee immediately to study contingency plans in the event of a large-scale reduction in American aid in order “to avoid last minute, uncalculated decisions.” Meanwhile, the Economic Planning Authority at the Finance Ministry has prepared a new five-year economic plan calling for drastic changes in the economy even if U.S. economic aid continues at its present rate.
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