Economic signs may be improving, but times are
still tough for Israel's poor.
Jewish Telegraphic Agency
rumbs tumble down Yigal
Alperson's white beard as he
eats his one guaranteed
meal of the day at a crowd-
ed Jerusalem soup kitchen.
Tables spill over with immigrants,
the elderly and single mothers, the
predominant faces of Israel's poor as
the country's economy is battered
seemingly from every direction.
Three years of Palestinian violence
have scared away investors, a world-
wide economic downturn has devas-
tated Israel's once thriving high-tech
industry, factories are closing because
of foreign competition, and govern-
ment cutbacks in welfare and social
spending in response to a $6 billion
deficit have taken their toll.
"My situation is difficult. We don't
have anything to eat," says Alperson,
66, an unemployed statistician who
supports his wife and five children on
the $888 he receives each month from
Israel's national. insurance system.
"This is security, you know," he
said, pointing to a plate piled high
with steaming pasta, chicken cutlets
and green beans at Meir Panay, a soup
kitchen designed to look like a restau-
rant. "At least you know you'll be eat-
Israel's unemployment rate is near
11 percent, almost 18 percent of fam-
ilies are living in poverty and the
number of poverty-stricken children is
on the rise. Israel now has one of the
highest poverty rates in the developed
world, according to 2002 statistics
released recently by the National
A study of 150,000 Israeli house-
holds, •released this month by the
JDC-Brookdale Institute, found that
8 percent were having severe difficulty
buying enough food.
Finance Minister Benjamin
Netanyahu's announcement last week
that Israel's recession was over sparked
a storm of protest. Netanyahu swiftly
backtracked from his remarks, saying
instead that there were signs of eco-
Exports are up and that's a good
sign, said Karnit Flug, who heads the
Bank of Israel's research department.
The stock market also has risen in
recent months. But it's still too early
to tell if Israel is headed toward better
economic times anytime soon, Flug
There is a lot of uncertainty about
the "security issue and prospects for
improvement of the geopolitical situa-
tion," Flug said. "The ability of Israel
to utilize its potential growth will
depend on impro;vement in these
The government has argued that the
economy's problems stem not only
from the intifada but from more
inherent problems in the structure of
To address these problems, Israel is
trying to privatize many state-owned
companies to boost competitiveness.
It has begun aggressively deporting
foreign workers, whom government
officials say take jobs away from
Israelis and bring down wages for
The 1990s saw a dramatic increase,
to 200,000 foreign workers in Israel.
It is one of the highest rates of foreign
laborers in the world, experts say.
Whether or not Israelis are interested
in taking these unskilled jobs remains
to be seen.
Another government project, reduc-
ing welfare support payments for the
poor, is expected to increase poverty
rates, the JDC-Brookdale study
found. By setting a time limit for
unemployment benefits, for example,
the government hopes to encourage
people to go backs() work. But in
Israel's present economy, finding work
is increasingly difficult.
The reforms "in the short term cre-
ate a lot more poverty," said Jack
Habib, a social economist who directs
the JDC-Brookdale Institute. "More
people are in need, but all the services
they need are being cut back."
Rabbi Yechiel Eckstein is the presi-
dent of the International Fellowship
of Christians and Jews, which funds
soup kitchens across the country, as
well as a network of warehouses where
the needy can receive free furniture
and other household goods. The gov-
ernment is embarrassed by how its
Needy Israelis eat at the Meier Panum soup kitchen in Jerusalem.
past five months, however, she has
been unable to find work. At this
point, she said, "I'll do anything for a
job because I have bills to pay and a
child to raise."
It can be overwhelming "to see the
amount of educated people, people
with degrees, at the unemployment
office," she said. "Getting an educa-
tion these days does not mean you are
going to get a job."
On Jerusalem's Ben-Yehuda Street,
the city's once-bustling pedestrian
shopping mall, the situation is grim.
Repeated terror attacks have kept
both tourists and locals away. Shop
owners say they barely clear $220 a
"Zero. There is nothing," snapped
Yosef Zakai, owner of a Judaica shop.
"Except for someone calling from the
United States for a Star of David,
there is nothing. There is no work."
A few doors down, a man named
Yosef wasn't sure how much longer he
could afford to run the women's
clothing store his parents opened in
1949. "This is the hardest period ever
for the store," he said.
Across from his shop, he pointed
out names etched on a memorial
plaque — eight victims of a 2001 sui-
cide bombing. "Here one died," he
said, pointing at a corner of stone
pavement. "Here another, here anoth-
All Spheres Hit
Yosef's voice trailed off, and he
Leah Rizel, 34, has a master's degree
in human genetics and has worked for headed back to his store — where,
atypically, a customer was waiting. ❑
several years in genetics labs. For the
stringent new fiscal policies are affect-
ing the country, Rabbi Eckstein
Such policies "have changed the
face of Israel. Now the question is
how to portray the public image of
Israel," Rabbi Eckstein said.
"No one wants to portray it as a
third-world nation, but to portray it
as an idyllic place where everything is
hunky-dory is morally and practically
The Sharon government is defend-
ing its policies, taking out ads in the
national press saying the reforms are
the only way to help the economy.
Netanyahu says the cuts are necessary
if Israel wants to have a modern econ-
Critics say other solutions — such
as raising taxes and investing massive-
ly in infrastructure — could ignite
growth and, in turn, boost tax rev-
According to recent surveys, howev-
er, most Israelis think the economy is
suffering because of the intifada
(uprising) and won't improve until the
diplomatic impasse is resolved. In
fact, it's not only unskilled workers
who are having trouble finding work:
As the economy slides, the highly
educated also feel the pinch.