Correspondents' Correspondence

...Elsewhere in the EEC Brussels—The European Economic Community (EEC) is currently taking some essential steps toward meeting the potentially explosive problem of youth unemployment Recent estimates suggest that almost 40 per cent of the 6 million unemployed in the Community are under 25 Most of these young people have never held a job, and the poorly educated among them may not ever do so full-time...

...As for the property declarations, it became clear that they would be required of almost half of all wage earners, not only the rich To make matters worse, filling out the necessary forms (previously required only of a small random sample of taxpayers and those suspected of tax evasion) is so complicated a business that most Israelis will need the assistance of an accountant or tax consultant, at a minimum cost of over half an average monthly salary Even this, perhaps, would have been forgiven in the name of trying to catch tax cheaters, if experts had not estimated that it would take the present number of Internal Revenue employees 40 years of hard work to check through the mountains of reports...

...Recession is taking its toll in all the industrial countries, and England is fortunate in having its North Sea oil revenues to offset an adverse balance of trade Nevertheless, the British have sharper memories than most of the miseries of unemployment between the World Wars and panic stories are featured regularly m newspapers Joblessness in the country, now approaching the 6 per cent mark, is already considered intolerable by the trade unions Yet with massive lay-offs being made in the nationalized steel industry (which has lost some $2 5 billion dollars over the past five years), and others coming elsewhere as the recession deepens, the figure is inching upward...

...bankrupt or near-bankrupt enterprises and making them profitable through tough reorganization Now as finance minister, Horowitz was telling the Israelis the unpleasant truths they had known all along but preferred to ignore They didn't work hard enough, they were eating more than their farmers produced, the public and service sectors of their economy were bloated, while industry was short of workers When Horowitz eliminated the government subsidies for basic commodities-milk, sugar, meat, eggs, cooking oil, gasoline, and electricity-prices shot skyward But despite the Histadrut's half-hearted efforts to organize mass protests against the cuts, the public still supported him And when Horowitz struggled bitterly to trim all government expenses in the 1980-81 budget by 5 per cent, they kept cheering him on...

...Correspondents' Correspondence BRIEF TAKEOUTS OF MORE THAN PERSONAL INTEREST FROM LETTERS AND OTHER COMMUNICATIONS RECEIVED BY THE EDITORS "Yesterday's Hero Tel Aviv for a few weeks this winter, newly appointed Finance Minister Yigal Horowitz seemed to be practically everybody's hero here Grim-faced, with a mournful voice, he kept repeating "We have no money The till is empty The party's over " And even though they realized it would freeze their standard of living as well as increase the country's still modest unemployment, Israelis rooted for Horowitz in his fight to cut government spending...

...ELIAHU SALPE1ER 'Buy British' London-the British are worried about the increasingly successful marketing of foreign goods in their country at the expense of homemade products-particularly about the effect of this trend on unemployment The Ministry of Transport recently announced that 56 per cent of the cars registered in the country within the last year were made abroad And British Leyland, the government-subsidized car company suffering from plummeting sales as well as labor strife, has placed a full-page advertisement m several London papers showing that the problem also extends to other industries It pictured a typical English kitchen, with the various appliances and implements labeled to indicate the percentage of each being imported refrigerators-69 per cent, cutlery-70 per cent, portable radios-36 per cent, glassware-66 per cent, pots and pans-36 per cent...

...The worst blow, however, was the backfiring of measures aimed against "black capital" (unreported profits and earnings) Together with the surprise change of the currency unit from the pound to the shekel (at a rate of 10-1), Horowitz announced that the amount of foreign cash each citizen could now hold would be reduced from $3,000 to $500, and that everybody above a certain income level would have to fill out a detailed property declaration The currency change, coming in the midst of three-digit inflation, seemed to most Israelis a futile, pseudopsychological gimmick at best, but the restriction on foreign currency holdings was seen as a major retreat from the whole policy of Friedmanite economic liberalization that was the Begin government's pride after coming to office in 1977...

...Yigal Horowitz appeared to be the light man A farmer-turned-businessman, he had specialized in buying...

...The average Israeli may be purchase-happy, self-indulgent and living beyond his means, but has always been fully conscious of his economic sins As he squandered the country's foreign currency reserves on imported cars, television sets, travel abroad, plus a host of other luxuries, in his heart of hearts he was aware that such behavior could only lead to economic disaster Israelis yearned for a strong hand to halt their misconduct...

...Since foreign products are often cheaper and carry reputations for greater reliability, "Buy British" campaigns, especially on the part of British Leyland, have met with little success...

...Moreover, with an annual growth rate of only 3 per cent projected for the 1980s, unemployment in the Community is expected to rise and especially affect those who will be reaching working age in record numbers Politicians and bureaucrats in the capitals of the Nine still seem to believe the problem can somehow be ameliorated through more work-orientation and vocational traimng programs But Western Europe's industrial planners now admit that lifelong employment may soon be a thing of the past, a relatively rare privilege for the few rather than a given of responsible adult life Unemployment, they say, will become less onerous and perhaps even quite respectable This suggestion that the much-honored work ethic of the First Industrial Revolution is on its way to becoming an historical curiosity clearly heralds a social transformation of major significance The EEC's Council of Ministers acknowledges that youth unemployment is deeply rooted in the economy's far-reaching structural changes—m industry's increased automation and in the energy and raw materials shortages of recent years Accordingly, the Council has adopted a number of measures—to be undertaken with the cooperation of unions, management and, m some cases, national governments—to maximize employment opportunities and to begin laying the foundations for a future free of the burdens of unremitting labor The Council's proposals include ?The banning of overtime, except in special circumstances (Even in such rare cases workers would be remunerated with compensatory time rather than with money) ?The development of part-time employment opportunities featuring flexible working hours, particularly for parents of young children ?The encouragement of early voluntary retirement, as well as the introduction of longer holidays and shorter working hours to help make the adjustment to retirement less difficult ?The initiation of more programs allowing for the alternation of work and training throughout the whole of an individual's career ?The establishment of programs that not only offer the young vocational training but also prepare them for more productive and creative uses of expanded leisure time Although today's high rate of youth unemployment has long been predicted, until now no effort was made to do very much about it While industry and agriculture gathered the profits of high technology by shifting toward more skills and capital-intensive activities, the supersalesmen of the Second Industrial Revolution depicted a society in which a relatively small number of specialists would provide for everybody else's needs But few considered what would happen to young people reared to follow the traditional work pattern but not yet able to enjoy the new leisure The measures to combat youth unemployment adopted by the EEC are the first small steps in the necessary reeducation of the West Europe, hke North America, remains in the thrall of a work ethic that glorifies labor in the service of outmoded technologies The Council of Ministers seems to be saying that if the nations of the West can no longer provide work for larger numbers of their young, then they must learn to provide the young with a livelihood and not hold them responsible for their enforced idleness —Thomas Land...

...Calls by Left-wing Laborites for protectionist legislation have not had much impact either, though the Tory government has urged the European Economic Community to restrict imports of low-cost, synthetic American textiles The Thatcher team's main thrust has been to encourage a laissez faire economic climate that will promote long-term expansion of industry and thus create more jobs The benefits of that program, however, have yet to be felt -Norman Gelb...

...Then things began to go wrong First, there were indications that unemployment was spreading faster in the factories than in banks or government offices, and that the credit squeeze was hurting farmers and export industries more than fancy shops and restaurants Next came disappointment over the Cost of Living Index Finance Ministry officials had been confidently predicting that in January there would be a substantial slowdown in the monthly increase in the inflation rate, which reached 8 per cent in December, but when the January Figure was published in late February it still stood at 7 3 per cent Soon afterward it was revealed that tax revenues were running behind schedule and the government was finding it necessary to borrow billions of pounds Thus it was feeding with one hand the inflation it was trying to choke off with the other...