Israeli Prime Minister Shimon Peres visited here yesterday and was greeted with warm praise from Secretary of State George P. Shultz for his "bold and farsighted leadership in tackling Israel's economic problems in a forthright and constructive way."
Peres' unofficial trip comes at a time when hopes of reviving the Mideast peace process have been sidetracked by Arab disagreements. The trip lacks the sense of expectation about progress toward Arab-Israeli peace moves that set the tone of his earlier visits here as prime minister.
Instead, his schedule yesterday, including appearances before reporters with Shultz and Vice President Bush, was devoted largely to exchanges of praise from both sides for the currently strong state of U.S.-Israeli relations.
Of note was a luncheon given by Shultz at the State Department for Peres and a group of businessmen seeking ways to diversify the Israeli economy. Shultz took the unprecedented step of having his lengthy remarks at what was supposed to be a private gathering transmitted over the department's loudspeakers.
Department officials said that Shultz, who had put heavy pressure on the Peres government to combat its economic problems with a tough austerity program, wanted to underscore the need for Israel to continue on that path and to cite Israel's progress as an example for other countries seeking to combat economic instability.
"The Israeli government has shown what strong leadership and a cooperative citizenry can accomplish," Shultz said. "Countries that have recovered against great odds from serious economic distress offer a valuable lesson to us all: it is that leaders should not underestimate the public support they will elicit from their people for doing the right thing even when the right thing requires significant sacrifice."
In response, Peres thanked the United States for its assistance, which included a special inflation-fighting infusion of $1.5 billion in addition to the sizable amount of U.S. aid regularly received by Israel. He said that preliminary figures for the first three months of the year indicate that Israel's once galloping inflation rate is receding dramatically.
In other remarks during the day, Peres repeated his strong endorsement of the U.S. challenge to Libyan leader Muammar Qaddafi in the Gulf of Sidra last week.
"The United States' action in Libya was timely, responsible, wise and really necessary for the free world," Peres said. He added that he believes it could prove "an effective deterrent" that will make Qaddafi more careful about his support of international terrorism.
Addressing the problem of reviving the stalled peace process, Peres said he doesn't "see anything else more promising" than the U.S.-backed effort to coax Jordan's King Hussein into peace talks supported by the "Palestinian people."
"We have decided, all of us, not to lose heart and stop," he said. "We shall not quit our efforts to arrive at a peaceful solution to the problems of the Middle East."
He also gave a qualified endorsement to the idea of maintaining the United Nations Interim Force in Lebanon (UNIFIL) as a means of keeping some semblance of order in that strife-torn country. But he indicated that Israel might want some deployment of UNIFIL away from its southern Lebanon positions where it frequently has become involved in frictions with Israel.