ISRAEL: Suddenly, Alarmingly Poorer

After the blood and tears of war, Israelis, to reverse Churchill's famous aphorism, were asked last week to sweat in the service of their nation. Faced with declining foreign reserves and the prospect of mass unemployment once the country can no longer pay for raw materials to feed its factories, Premier Yitzhak Rabin's government imposed the stiffest austerity program that Israel, or almost any other nation, has ever seen.

As a starter, the Israeli pound was devalued an astonishing 43%, the eighth devaluation in 26 years. Imports of 29 luxury items, including autos, were banned for six months, and import taxes...

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