Israelis Strike Over Austerity Plan : Nationwide Action Protests Price Hikes and Wage Freeze

Hundreds of thousands of Israelis went on strike Tuesday, virtually closing the country down to protest government-decreed price boosts, a wage freeze and other measures designed to strengthen the nation’s battered economy.

The 24-hour general strike was called by the giant Histadrut labor federation, which said selective job disruptions will continue all week. Most of its 1.5 million members took part in the walkout. The total work force is about 2 million.

Thousands took advantage of the strike and the sunny weather to go to the beach. “The people of Israel are on strike, but it’s like a festival. We are going to the sea,” one woman told Israel radio.

Police Intervene

Others protested more actively. In the Negev desert city of Beersheba, Israel’s fourth largest, strikers blocked the main road with heavy equipment and stopped traffic for nearly two hours until police intervened. Other demonstrations erupted in blue-collar sectors of Jerusalem.

Banks, grocery stores, factories and government offices were closed. Hospitals operated on an emergency basis. Small, privately owned shops remained open.

Israeli newspapers did not publish, and radio stations broadcast only hourly newscasts.

El Al, the state-owned airline, operated at Ben-Gurion International Airport. Passengers were told to expect lengthy delays in retrieving their baggage.

Prime Minister Shimon Peres said Tuesday that the harsh new measures, enacted under pressure from the United States, were Israel’s “economic Yom Kippur,” a reference to the annual Jewish day of atonement, Israel radio reported.

He said Israel had been living beyond its means for too long.

Peres told the American-Israeli Chamber of Commerce on Tuesday night, without specifically mentioning the strike:

“In the last 24 hours, we have gone through a tough period.”

He defended his harsh new measures as “personally painful, economically complicated but socially just.”

The prime minister’s office said Peres has offered to cut his own salary, which is about $1,800 a month at the current rate of exchange, by 5%.

Despite labor opposition to the austerity measures, Parliament gave the program its strong support in a vote seen as a test of confidence in Peres’ 9-month-old government.

Although its approval was not required, Parliament endorsed the emergency plan by a vote of 70 to 19. Most of the opposition was from small, left-wing Socialist and Communist parties.

Histadrut leader Yisrael Kessar of Peres’ Labor Party, who argued that the tough measures would victimize workers, was one of three legislators who abstained.

The austerity plan is expected to cost about 10,000 public-sector jobs.

Stormy Cabinet Session

The government estimated that the austerity plan would cut real wages of the average worker an estimated 12%. Kessar said the cut would be closer to 33%.

Government leaders had predicted widespread job actions as a result of the austerity program, which was put into effect Monday after a stormy 24-hour Cabinet session.

When the United States refused to grant a request for $750 million in economic aid, Peres said Israel’s only choice was to “take strong, powerful, fast steps immediately.”

Inflation reached more than 440% in 1984 and is expected to top 300% this year.

The measures boosted prices of all goods and services by an average of 24%, devalued the shekel by 18.8% and instituted a three-month wage freeze. Prices also were frozen for three months at their new levels. Israel’s budget is to be cut by $750 million.