THE DETROIT JEWISH NEWS Friday, November 15, 1985
( Al's Foreign Car Service
EUROPEAN
CARD & PALM
READINGS
Jerusalem (JTA) — Israeli
policymakers are locked in a
battle of the budget. Finance
Minister Yitzhak Modai is urg-
ing cuts totalling $500 million
in the 1986-87 budget for the
Defense, Education and Health
Ministries but Premier Shimon
Peres is adamantly opposed.
A series of meetings between
Peres and Modai has failed to
break the deadlock. Modai re-
portedly has warned that with-
out the specific cuts, important
goals of his economic austerity
program will not be met on
schedule.
After a late night meeting
last Thursday, aides to Peres
said the Premier would allow
"no further blows at defense,
education and health." They
noted that cuts in the defense
budget inevitably resulted in
lay-offs and closures throughout
the economy because the defense
establishment is a major con-
tractor of a host of civilian in-
dustries.
There is a political element in
the economic discussions. The
three ministries most affected
are headed by Laborites — Yit-
zhak Rabin at Defense, Yitzhak
Navon, Education and Mor-
dechai Gur, Health. Modai is a
Likud-Liberal and there is sus-
picion in Labor circles that his
demand for cuts is motivated at
least partly by partisan political
considerations.
Meanwhile, the government
has relaxed its policy toward
certain sectors of the economy
that are in especially dire
straits. The Cabinet last week
approved a $90 million loan to
farmers and agreed to make $50
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million in government funds
available to hard pressed local
authorities. Development towns
have been exempted from the
blanket freeze on public build-
ing and investment.
The government also plans to
take steps within the next few
days to lower interest rates,
Prime Minister Shimon Peres
told the Histadrut convention in
Tel Aviv last week.
Peres' address to the 1,501
delegates was devoted to a
wide-ranging review of the eco-
nomic situation during which he
singled out tax reform and the
lowering of interest rates as the
most important short-range
goals facing the government.
Meanwhile, Cabinet Ministers
are ignoring their own decision
not to go on overseas trips until
the economic situation in the
country has improved. Accord-
ing to a report in Maariv, the
government has approved a
number of trips for government
officials.
These include a visit by De-
fense Minister Yitzhak Rabin to
the United States for talks with
Administration leaders and ap-
pearances before Jewish organ-
izations and a fund-raising trip
by Minister-Without-Portfolio
Moshe Arens.
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