I NEWS 1
Jerusalem (JTA) — The
Treasury and the Defense
Ministry seemed to be closing
the gap between them on the
amount of defense spending
that will be reduced in the
new fiscal year. Deputy
Premier David Levy said
there were "grounds for op-
timism" that the defense
budget will be settled.
Levy, who is also housing
minister and the No. 2 man of
Likud, spoke after a meeting
with Defense Minister Yit-
zhak Rabin, his top aides and
senior Israel Defense Force
officers.
The meeting was in the con-
text of interministerial
budget discussions in which
Peres is also participating.
Unofficial reports said the
Treasury will be satisfied
with a 120 million shekel cut
in the defense budget this
year.
According to Rabin, it
originally planned to slash
450 to 600 million shekels
from the defense budget,
which he called dangerous
and unacceptable.
The finance minister also
must convince the Histadrut
that the well-to-do will share
the burdens of economic
austerity.
Communications Minister
Gad Ya'acobi, a Peres sup-
porter, disclosed that the
Treasury is considering a
special levy on "relatively
new and relatively large cars"
to separate the more affluent
sectors of society from part of
their spending power.
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Israel Applauds
Naval Action
Jerusalem (JTA) — Israeli
leaders were quick to praise
the U.S. Navy for shooting
down two Libyan jet fighters
off the Libyan coast last week
The first reaction came
from Deputy Prime Minister
Shimon Peres, who is also
finance minister and leader of
the Labor Party. He said the
Americans were obviously
threatened by the Libyan
planes.
Avi Pazner, media spokes-
man for Prime Minister Yitz-
hak Shamir, said the incident
seemed to be a. Libyan pro-
vocation. "Coming from a
country like Libya, you can
expect that kind of behavior,"
Pazner said.
According to an announce-
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