Prime Minister Yitzhak Shamir intervened swiftly with his own Likud party this week to defuse the first political crisis with its Labor partners since the unity coalition government was formed Dec. 22.
Shamir rushed to the defense of Finance Minister Shimon Peres, the Labor Party leader, who was under savage attack by Likud Knesset members for his proposed bailout of ailing Histadrut enterprises.
Shamir let it be known through his spokesman that he was supporting Peres.
He was joined by Deputy Premier David Levy, who reminded the bristling Likud critics Monday that Peres is finance minister in a unity government, and his policies are binding on the entire Cabinet, Likud and Labor alike.
For a short time, however, it seemed that Likud had a powerful tool with which to bash Labor two weeks before the Feb. 28 municipal elections.
They accused Peres of pandering to Histadrut to save its tottering economic empire.
Matters came to a head when Peres, after weeks of tense bargaining, averted a one-day general strike called by Histadrut for last Sunday that would have idled a million people and paralyzed the country.
The outstanding issue was cost-of-living increments to compensate wage earners for the soaring price index.
The facts and figures remain a matter of intense dispute.
It appears, however, that the two most powerful Histadrut bosses, Secretary General Yisrael Kessar and Haim Haberfeld, head of the trade unions department, settled for a rather anemic deal.
12 PERCENT INFLATION
While inflation is running at about 12 percent, the result of slashed price subsidies and devaluation of the shekel, wage-earners will get only a 6 percent rise in their cost-of-living allowances.
Moreover, its payment will be spread over 13 months.
Kupat Holim, Histadrut’s financially strapped health care agency, also will be helped, as will the trade union federation’s unemployment and retraining program.
Peres claimed these outlays will cost the Treasury less than $110 million and are in the national interest.
At a meeting of their Knesset faction Monday, some Likud members urged revolt, saying the party should not support the finance minister’s proposals in parliament.
Peres responded quickly, telling a television interviewer that if Likud balked at his budget, the unity government was over.
At that point, Shamir and Levy moved in to cool the atmosphere.
Their straightforward support of Peres in the interests of the coalition reassured the political community.
JTA has documented Jewish history in real-time for over a century. Keep our journalism strong by joining us in supporting independent, award-winning reporting.
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.
