Two weeks in office, the prime minister sketched the broad lines of policy he intended to pursue, both at home and abroad. At the top of the agenda was the future of Israel's presence in Lebanon, a subject discussed with Assistant Secretary of State Richard Murphy. Mr. Peres revealed that the defense establishment was preparing proposals for the government's approval. Other points in the interview were future relations with Jordan, domestic economic reform and his forthcoming visit to Washington. Text:
Q: Youre on record as saying that Israel should be out of Lebanon within a matter of a few months. That, too, is the view of Defense Minister Yitzhak Rabin. Foreign Minister Yitzhak Shamir said that we no longer insist on a parallel Syrian withdrawal and that we would like the U.S. to act as an intermediary between Jerusalem and Damascus. Indeed, U.S. Assistant Secretary of State Richard Murphy has already had talks with President Hafez Assad in Damascus and has spoken to you about these talks. How much nearer has this new policy brought us to withdrawal from Lebanon?
A: It is the decided view of the national unity government to secure the northern part of Israel and to withdraw completely from Lebanon. It surely requires some arrangements, both militarily and politically. Politically - on the 16th of October there should be renewal of the U.N.I.F.I.L. Forces in Lebanon and their deployment, considering the possibility that Israel may withdraw from Lebanon, and some military arrangements, which the minister of defense is right now dealing with. I do hope that in a matter of several weeks, a plan will be put forward before the government, and the government will be in a position to make its final decision. And again, I hope very much that in a matter of several months, this decision will be implemented.
Q: And the talks that Mr. Murphy has had?
A: Mr. Murphy made a tour in the region, and it's only normal that he tries to listen to the different views, because the American administration, in one way or another, is involved in the state of affairs of Lebanon. But right now, the most important thing is for Israel herself to make her proposals and decide on outlines.
Q: In light of the massacre which certain soldiers from the South Lebanon Army caused in a Shiite village in southern Lebanon, are you encouraged by the performance of this force, and will the planning that you'll submit in a few weeks be predicated basically on this force?
A: Lebanon has her own way of life, which unfortunately is completely different from ours. The massacre you were referring to is a terrible event, unfortunately not the first one and, I'm afraid, not the last one. That's one of the reasons why the Israeli army should not remain in Lebanon - because our army has different norms and different standards, our army acts only on very lawful measures, never escaping them. And in Lebanon there can be only Lebanese forces with their habits and ways of life. For the time being, the best solution to fill a vacuum, in the southern part of Lebanon is surely the Lahad forces, I do not see an alternative to that.
Q: You indicated that you are anxious to revive the peace process, including some kind of contacts with King Hussein. President Reagan stated that the Reagan Plan which he submitted last year is still very much alive; he still stands by it. At the time, you criticized the Shamir government for rejecting it outright. Where does the national unity government stand on this?
A: When it comes to government, there is the law of continuation - namely, until and unless one government changes the decisions of the previous government, the decisions are remaining as they were. Now the present government did not have a chance, not did she have a need to consider the Reagan initiative;... Neither were put forward before us any other American proposals. A government is not a theoretic or an academic body; it deals only with real matters when they come up realistically. So for the time being, the national unity government did not take any position on the issue, and by the nature of things, the previous decisions do exist. Now the declaration of President [Reagan] was of a general nature, without any dates or any appeal to Israel. And I do not feel that the government is in a need right away to make up its mind on the American proposals.
Q: You are going to Washington early next month. When there, you are likely to be questioned closely about the Jewish settlements in Judea, Samaria, and Gaza, and also about trying to bring King Hussein of Jordan into the peace process. How will you respond?
A: In accordance with the guiding lines of the present government. When it comes to settlements, there are four major decisions concerning settlements, and those are' [First] that the existing settlements will remain; nobody has in mind to dismantle any settlement which exists today either in the old Israel or in the whole Israel; secondly, concerning the development of the existing settlements, it is for the government to decide on the scope of the development; thirdly, there are some decisions in the pipeline which we shall deal with later on; and fourthly, when it comes to the establishment of new settlements, there is a need for a clear-cut government decision; no new settlement can be formed, without a specific decision on the part of the government.
As far as Jordan is concerned, there are many issues. Basically, the present government has decided - or the guiding line of the new government has - two points concerning Jordan: Firstly, that we invite the Jordanians to peace negotiations in order to open a new page for the development of the area. And secondly, the government has announced that we are ready to consider any proposal that the King may suggest in order to solve the outstanding issues between Jordan and Israel. So, if you wanted, some open-ended situation. And in addition to it there are many other issues, say of an economic nature, which requires a negotiation and an understanding between Jordan and Israel. So we are ready to do so: To meet, to negotiate, to talk, and to look for solutions.
Q: The American have made it clear that they will be prepared to give more aid to Israel only if Israel adopts a tough and credible economic recovery program. Experts in this country say that the budget should really be cut by $2 billion; your government proposes to cut the budget by $1 billion. What can you tell the Americans about Israel's program that will convince them to increase aid?
A: I would say that basically, how to put our house in order is our task and our responsibility. We do not need the urging of the American government to do so. It is for us to turn the Israeli economy in the right direction, even at a painful cost, and we shall surely do it. But this is just one part of our economic policy; the other part is to return to a policy of growth and development. And my main emphasis in Washington will be the American participation in the renewal of the growth, while we should remain responsible for the necessary measures to put the economy in order.
Q: It is less than two weeks since you took office, but already your cabinet has been ultra-busy trying to come to grips with the economic problem. The criticism coming from within the ranks of your cabinet is that as far as the policy so far, this has been imposing rather draconian measures against the public, which, according to the Treasury, will more than double the 400% inflation with which we've been living. Some of the cabinet colleagues accuse Finance Minister Moda'i of not presenting a coherent economic program. How do you reach to this?
A: Well, may I suggest at this hour to the people who have spoken on behalf of the Treasury to take a more modest policy, because I cannot claim that they have conducted the economic affairs of Israel in such a brilliant way until now. When it comes to the economic plan, there are clearly several steps that should be taken in a given order. Number one - we have had to cut, as we have said, the national budget of Israel. It is easy for an expert to say "cut two billions" instead of one billion; but I wonder if the experts really had a good look at the budget. When you deduct the loans, the interest, from the budget, [then] the net budget of Israel today is $11 billion, in real terms. To cut $1 billion is almost 10% of the budget. To cut $2 billion is 20%. Now, from where can you cut? Education? Health? Police? It's not that the government is spending money; those are public needs, or, if you want, even individual needs. If a child goes to school, what do you want, to cut his schooling? If a sick person goes to hospital, what can you tell him: Economize? Don't go? Be healthy? Some people are bringing it to an absurdity. And the government must be very balanced and very responsible. When I looked at the figures, I felt that $1 billion is quite a lot. And many governments had decided already in the past on cutting the budget. The test of the resolution is not in making it but in realizing it. And I hope that we shall really cut.
The second step is to economize on the crazy money which runs throughout the market and inflates every corner, The measures that the government has decided to take the other week was really to reduce the amount of money which is wildly running around. I do believe it will economize the extra money by half a billion dollars.
The third step in our economic plan is to reach a national contract between the government, the histadrut, and the employers, so that we shall be able to restrain prices, wages, salaries, profits, and so on.
And the fourth part of an economic plan is to renew investment, a policy of growth. Now we are dealing simultaneously with all those four aspects of an economic policy. I hope that everybody will understand that this cannot be done in a matter of two weeks. After all, the government is not a very old one, and what we did already in ten days is quite a lot.
Q: What you are saying, in effect, is that you don't accept the criticism that there is no overall economic plan, and that the fact that inflation has doubled - that's one of the facts of life.
A: What I'm saying is that I expect criticism: Since the economists themselves are in disagreement, whichever way we shall turn, there will be part of them that will criticize. We will find more than one school of thought among the economists, not only among the people of the government. And whoever wants to put their house in order must live with the idea that we shall be criticized. Now the test of the doing is not in facing criticism. But in achieving the results. It will take a little bit of time; we shall have to pass through a very difficult period of time. I'm convinced that we can do it, and that at the end of that period, we shall see an entirely different economy in our country.
Q: On the eve of the Jewish new year, what message can you offer to the people of Israel and what hope can you offer to the Jews in the Soviet Union, in Syria, and in other countries where they are oppressed?
A: Israel is a very special country. Her potential is always greater than her performance. And in spite of all the difficulties which we are facing, we have all of us to remain a people of hope, of trust, of wish. I do believe that in the coming year, we shall see the change of the economic situation in Israel. I am convinced that Israel will eventually become one of the most developed countries on earth. We can build an entirely new economy based on science, education, hi-tech, and remotivation of every person in this country to do so. I do hope to see our boys back home from Lebanon. I do believe that Israel will enrich itself with a new style in her public life. All of us felt very strongly that over the recent years, the split, the tension, the high pitch of our political way of life became almost dangerous, if not physically, at least educationally. And with the creation of a national unity government, we may learn how to talk to each other even when there are different views, even when there are different ideologies. And I do believe and I do hope that we should renew the immigration to our country; that's the most important effort for Jewish life and for the State of Israel. The fate of the Jewish state depends upon the number, the quality and the spirit of the Jewish people. Then I do believe also, and I hope very much, that not only the style of our life will be changed, but we shall learn how to live together in an air of respect between religious and secular people, between people who came from different parts of the earth, between Jewish people and Arab people. Because the problems of Israel are not just military, or economic, or political ones: they are very much a problem of social fabric, of the quality - the moral quality - of our life as a Jewish people. Now while being in the government, I am convinced that the fate of Israel depends upon its citizens. Each of us can do a great deal to improve our economic and political and moral life. I do hope that together we can embark upon a new road and march together to a destiny which will fit our historic desire. Finally, Israel is not a rich land. What enriched the land is its people. Israel is really an indication of what people can do with their physical surroundings. And so much depends upon each of us, individually and collectively, and I hope we shall join hands and make our country great, peaceful, and promising.
Q: What do you say to the Jews of the Soviet Union and Syria?
A: The raison détre of the State of Israel is really to follow the fate of the Jewish people and Jewish life not only in our own country, but abroad. I want to tell the Jewish people in the Soviet Union that we feel completely identified with them, that we did not give up the hope that the day will come when they will be able to enjoy the open gates of Soviet Russia and reach us and work together that many of them took great pains to maintain their identity with Jewish life; we respect it very much, and we hope they won't lose their courage. And together we work in order to meet again in the right place.