Israeli Government Urged to Give Priority to Fight on Unemployment

The battle within Israel’s parties over plans to deal with the country’s economic troubles shifted today to a growing demand that Government action to check mounting joblessness receive immediate priority.

The parties within Premier Levi Eshkol’s Mapai-Achdut Avodah-dominated Government continued to be sharply split over details of Finance Minister Pinhas Sapir’s tough, three-year austerity program. The Sapir plan calls for higher taxes, drastic cuts in cost-of-living allowances to wage-earners, penalties for inefficient industries, and incentives to industries producing for export. A series of coalition party meetings has done little to end the differences. Mapam holds that the Sapir plan bears too heavily on the wage earners. The National Religious Party and the Independent Liberals urge greater efficiency as the key to Israel’s mounting inflation and worsening trade imbalance.

While Mr. Eshkol announced plans for further efforts to win some kind of coalition agreement on the Sapir plan, virtually all of the parties began putting pressure on the Government to deal with the problem of growing joblessness.

Mapam sources said Israel should seek “a more just distribution of the burden of fighting unemployment.” They said this was the basic reason for Mapam’s demand for a compulsory loan as well as for higher taxation on middle and higher incomes. Achdut Avodah was reported to be in complete agreement, despite Mr. Sapir’s strong opposition to such a loan.

At the same time, Mapai leaders in the Histadrut, Israel’s labor federation, indicated increasing concern about the unemployment problem. They estimated there would be 45,000 jobless by January, 1967, compared with some 24,000 unemployed workers at present.

TEL AVIV MAYOR SEES THREAT OF JOBLESSNESS IN BUILDING TRADES

The Tel Aviv secretariat of Mapai urged immediate Government action to curb unemployment in the building trades in Tel Aviv. Mayor Mordechai Namir told a Tel Aviv branch meeting that applications for new building permits were down almost to zero, and said there would be severe unemployment among building workers in Tel Aviv. The Mapai branch then endorsed the mayor’s demand that the Government carry out a promise to start slum clearance projects and build housing for young couples.

The pressures for prompt Government action to curb unemployment were expected to add new difficulties to Premier Eshkol’s efforts for the Sapir plan which specifically envisaged considerable unemployment as inevitable if the country was to expand exports by greater industrial efficiency and lesser Government outlays for workers.

The Premier said he planned to convene another meeting of all coalition parties next week to seek an economic program acceptable to all parties. One result of previous meetings was an announcement by the National Religious Party and the Independent Liberals that they have coordinated their position to oppose any heavier taxation, including an Alignment proposal to increase taxes on companies by 5 percent. They also reaffirmed their opposition to any compulsory loan.