BUSINESS
Brecher recommends a one-stop
the only way to achieve Zionistic
agency
for Americans interested in
ideals.
doing
business
with Israel. Israel, he
Peres — who was prime minister
says, also must make it easier for
for two years when Israel's inflation
plummeted from 400 percent to less these Americans, cutting through red
tape that many U.S. businessmen en-
than 20 percent today — devalued the
in Israel.
Israeli shekel by 13 percent in counter
"We need to create an environ-
January.
Consequently, the cost-of-living ment in which we pool our resources
and make it work;' Brecher says. "If
index jumped about 5 percent.
people in the U.S. would start involv-
Now Israel's goals have changed. ing themselves in one-on-one business
Jews all over the world show little in- contacts, it will do more than
terest in immigrating to Israel. And anything else to boost Israel's
experts say Israel's first prime economy?' El
minister David Ben Gurion's plan to
fulfill Zionism with socialism is
outdated.
"'lb this day, the Zionist-socialistic
matrimonial bonds remain strong,"
Hanke and Rabushka wrote. "Israel
An Arab works side-by-side with an Ethiopian Jew.
suffers from socialist economic drag;
growth rates are lower than they
would
be if the economy were organiz-
trolling
interest,"
Hanke
says.
"They
working in a socialist country.
ed
along
capitalistic lines."
must
literally
transform
the
economy
"Israel is intriguing because it
into
a
free_market-oriented
economy?'
High
interest rates, the Arab
has so much potential," says Steve
Privatization, Bavly says, is "not uprising in the West Bank and Gaza
Hanke, an economics professor at
Baltimore's Johns Hopkins Universi- just talk anymore. We are in our in- and inflation caused a mini-recession
ty, who, with Stanford University Pro- itial phase. The previous administra- in 1988, making it difficult for
fessor Alvin Rabushka, recently tion offered no economic policies to Israelis to believe the economy is mov-
published Israel's first blueprint for correct the situation. Today, the ing forward.
economic rebirth. "If the state would government is more aware."
Professor Hanke suggests that the
get out of the economy, Israel would
American business community direct-
usiness is often a last priority
take off like a rocket. It could be the
ly pressure the government to get its
for Israelis faced with continu-
Hong Kong of the Middle East?'
ing battles with their Arab hands out of the economy.
The study, commissioned by the
Israel, he says, has become a
neighbors and skyrocketing
Institute for Advanced Strategic and
welfare
state and must make drastic
cost-of-living rates. A person
Political Studies in Jerusalem, is
choices.
what Institute Chairman Ivan Novick wishing to set up a business in Tel
"When you get backed up against
calls the "start of a conservative Aviv could pay as much 52 percent a the wall, you are forced to make tough
year
in
taxes
on
his
earnings.
A
man
revolution in Israeli policy?'
changes to do the right thing;' Hanke
Adds Dan Bavly, a partner with earning $25,000 a year might pay as
says. "The only chance for in-
the Tel Aviv consulting firm, Horwath much as $10,000 in taxes.
vestments to bear fruit is for
Rather
than
stay
in
an
economy
Bavly Millner & Co., "We are sitting
where the average salary is $850 a businessmen to continue to press the
on a gold mine?'
Hoping to guide Israel to that gold month and the majority of the popula- government?'
Ephraim Brecher,- president of
mine, Shimon Peres, Israel's labor tion lives on credit, many of the
Operation
Independence, recently
brightest
and
most
ambitious
Israelis
leader and finance minister, recently
move
to
the
United
States.
They
returned
from
a trip to Israel where
implemented a plan to sell some of
he
met
with
Knesset
members to
generally
find
employment
in
high-
Israel's government-owned holdings
tech companies in such industrial discuss ways in which Americans can An Israeli factory worker.
to private companies.
areas as the Silicon Valley in help the Israeli business establish-
Peres' austerity program aims to
ment.
reduce government control of the California.
Statistics show that in the last
economy. For starters, the state, five years more people have
which owns hundreds of enterprises emigrated from than immigrated to
and is heavily entangled in the Israel. In 1985 and 1986, 9,500
private sector, hopes to privatize 30 Israelis left the state of 4.5 million
government-owned businesses. Israel
late last year sold 75 percent of Paz residents.
This exodus, says Elmer Winter,
Oil. Last month, the government sold chairman for the Committee for
the remainder of its shares.
Economic Growth of Israel, could put
Now Israel Chemicals, a holding
further stress on Israel's high-tech in-
company that owns or maintains in- dustries by creating a brain drain in
terests in The Dead Sea Works, Israel the country's most lucrative field.
Phosphates, and other companies bas-
"They are losing too many people
ed on the Dead Sea, is on the sale
—
mostly
engineers and scientists —
block.
Other companies targeted for sale because it is attractive to go to
to the private sector are Israel Elec- America," Winter says. "Israel has to
tric Corp., El Al, Israel Airlines Ltd., reach a point where it becomes- finan-
Israel Aircraft Industries Ltd., cially independent?'
Israel is in a state of transition.
Bezeck, (Israel Telecommunications
Corp.) and Israel Bank of Agriculture. For the past 40 years, Israel has been
"Privatization won't work if the building a home for the Jewish peo-
government sells 50 percent to ple. Its founders viewed capitalism as An Israeli man helps produce shower heads.
private enterprise and still holds con- an enemy, vowing that socialism was
THE DETROIT JEWISH NEWS
37