March 24, 1986

In 1974 when the Arab oil-exporting states were just reaching the pinnacle of their economic and political power, Prime Minister Yitzhak Rabin prophesied that Israel was headed for seven lean years. But reversing Joseph's warning in the Bible, Mr. Rabin added that the seven lean years would be followed by seven fat years - if Israel could just weather the oil price storm. Mr. Rabin was off by a few years, but his instincts proved correct. Israel had to weather a decade of lean years, during which its gasoline prices reached $3 a gallon, its hostile Arab neighbors increased their wealth astronomically and its diplomats and business executives were kept at arm's length by would-be friends in Europe and Africa who were afraid of offending the Arab oil powers. But the oil-lean years appear to be over for Israel, at least for now. The drop in oil prices and the decline of the power of the Organization of Petroleum Exporting Countries is proving a diplomatic, strategic and economic bonanza for Israel, and Israeli officials say they believe the situation will only continue to improve.

For American consumers, who for several years enjoyed cheap imports ranging from felt pens to cars, the bargains are ending. Japanese products, in particular, are bearing higher prices because of the yen's surge against the dollar, to its highest level since World War II. With foreign currencies rising, all kinds of imports - including televisions, motorcycles, beer and personal computers - are likely to become more expensive. ''All it's going to mean is I can't afford what I want,'' said Andrew Palleo, as he emerged empty-handed from a Federated Group electronics store in Temple City, Calif., where he had been looking for stereo components. Car Prices Up Auto prices already are rising. Last Wednesday, for example, Nissan raised prices on new cars and pickup trucks an average of 3 percent, or $328. That followed a 4 percent increase in December. Volkswagen, Volvo, Toyota and Honda have also raised prices on new cars, and further increases are expected.

A map on Feb. 25 with a Rio de Janeiro dispatch about an Amazon kayak trip incorrectly labeled a coastal area south of Peru. It is part of Chile, not Argentina.

The importance of public relations is not lost on Government agencies, and according to a recent study by the General Accounting Office, spending in this area by the Reagan Administration, after dipping three years ago, is back on the rise. During the early Reagan years, spending commitments on public affairs at 13 Cabinet departments and 18 independent agencies fell from $303.6 million in the 1981 fiscal year to $290.6 million in the 1983 fiscal year.

In an old neighborhood here that has been plagued for decades by poverty and abandonment, residents were surprised recently to see a cluster of new houses for low-income families going up on Breckinridge Street. More surprising was the discovery that the construction had been initiated by an unexpected source: the State of Kentucky. While the Federal Government and city governments in Kentucky have been active for decades in efforts to restore urban slums, the state government, based in the small city of Frankfort and historically attuned to the needs of rural and suburban areas, had never taken the lead in trying to solve the problems of old industrial cities. Yet what is happening in low-income housing in this industrial city, with its high concentration of urban poor, is typical of initiatives that state governments are beginning to take in many areas, while the Federal role in coping with such concerns has steadily declined in the 1980's. These include industrial development, job training, health, welfare and the environment.