FREEDOM VS. SECURITY FILES

Israelis strike in protest at budget cuts (Sharmila Devi, May 1 2003, Financial Times)

About 700,000 Israeli public sector workers began an open-ended strike?on Wednesday?in protest against a government austerity package linked to $10bn of US loan guarantees and defence aid.

International flights, ports, the stock exchange and many other services were paralysed as the emergency plan, incorporating Shk11bn ($2.4bn) of budget cuts, passed the first of three parliamentary votes last night.

Washington has made its support conditional on passage of the plan, which will slash public sector jobs and wages and lower taxes. The measures have been dubbed an "economic road map", in reference to the political road map towards peace that was presented to Israel and the Palestinians by diplomats on Wednesday.

Almost 31 months of conflict with the Palestinians, accompanied by high defence spending, have contributed to two years of recession. "The government's overdraft [budget deficit] is growing and international banks have told us they will not give us more money," Benjamin Netanyahu, finance minister, told the Knesset on Wednesday.

Mr Netanyahu, who was shifted from the foreign portfolio to finance by Ariel Sharon, prime minister, unveiled his ambitious economic programme in March.

He plans to cut welfare benefits and the public sector, and to accelerate privatisation to create a more market-oriented economy. Israel has one of the lowest worker participation rates in the Organisation for Economic Co-operation and Development, partly due to the number of ultra-orthodox students, who risk losing generous family benefits.

Mr Netanyahu?on Wednesday?urged the Histadrut labour federation to find a compromise and end the strike. He has said he would consider changing the plan after the first vote, leading some analysts to fear he will water down the plan.

"If [Mr] Netanyahu wants to prove that he is a Thatcherite, then he has to have the guts to fight the unions," said Pinchas Landau of the I-Biz consultancy.

"If he doesn't, then the budget deficit will get out of control and we could face a crisis of Argentina proportions."

Few would argue, we suppose, that there is any Western nation that places a higher premium on its national defense--the ultimate guarantor of a nation's freedom--than do the Israelis. But we see here that even they (or at least a significant portion of society), at this late stage of the Social Welfare state, are unwiling to pay for that defense if it means reductions in social services--personal financial security is become the be-all-and-end-all.

This is especially significant for those who harbor fever dreams of a resurgent Europe. If the Israelis, in imminent threat of destruction, feel this way, just imagine how the French (who have no instinctive loathing of surrender) will react when told they have to give up welfare benefits, or work over 35 hours a week, to buy Mirage jets, so they can influence policy in Upper Volta. These just aren't serious countries anymore. Posted by Orrin Judd at May 1, 2003 9:52 AM