June 18, 2024
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June 18, 2024
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Is US Aid a Threat to Israel?

The IDF is addicted to credits for shiny new American weapons. But the strategic price may be too high.

Editor’s note: This analysis was written prior to the House overwhelmingly passing legislation to provide $1 billion to Israel to replenish its “Iron Dome” missile-defense system, after the funding had originally been removed from a broader spending bill.

Notwithstanding the continued support for Israel among most Democratic legislators, and despite the efforts of both countries’ leaders to play down its seriousness, the recent blocking of $1 billion of U.S. military aid to Israel is a turning point. For the first time in memory, Congress failed to approve a large-scale defense package for the Jewish state. And though progressive senators such as Vermont’s Patrick Leahy have challenged the sale of offensive weaponry to Israel, this is the first time Congress has withheld aid from a purely defensive system. By harmlessly shooting down Hamas rockets that would otherwise have to be silenced by massive air and ground action, Iron Dome saves thousands of Israeli and Palestinian lives.

Those lives, apparently, are less important to Congress’ anti-Israel progressives than denying assistance to Israel. The success of the “Squad”—House Reps. Alexandria Ocasio-Cortez, Ilhan Omar, Ayanna Pressley, and Rashida Tlaib—in preventing their own party from backing Iron Dome is unprecedented and a harbinger of more brazen efforts to come. Although the funds are widely expected to be approved at a later date (the leader of the House Appropriations Committee introduced legislation with Iron Dome funding the day after progressive Democrats had it removed from a government spending bill), for Israelis, the event must serve as an overdue wakeup call to begin rethinking the nature of American aid, one of the mainstays of our alliance with the United States.

Though now taken for granted, American defense aid for Israel began belatedly and grew in fits and starts. Throughout its first two decades, while assisting Israel economically, the United States refused to sell Israel any arms, much less aid it militarily. A breakthrough occurred during the Kennedy administration, which sold Hawk anti-aircraft missiles to Israel, followed by President Lyndon Johnson, who allowed it to purchase Patton tanks and Skyhawk aircraft. Even then, Israel fought the 1967 Six-Day War with French weaponry—AMX tanks and Dassault Mystère fighters, plus some American army surplus—but in the process proved its worth as a potent Cold War ally. The result was an inchoate U.S.-Israel strategic alliance that burgeoned during Israel’s War of Attrition (1967-1970) with Soviet-backed Egypt, and then in the Yom Kippur War of 1973. In Operation Nickel Grass, the United States replenished Israel’s battlefield losses with some 55,000 tons of military equipment.

The material was paid for, not donated. Outright military aid to Israel would only be offered in 1979, after the Camp David Accords with Egypt, when President Carter earmarked roughly $3 billion for Israel. The grant, though, was spread out over several years and used to reimburse Israel for the air bases it evacuated in Sinai. Not until the mid-1980s, in the Reagan years, did Israel receive an average of $1.8 billion per year, increased by the Clinton administration to $2.4 billion. In large measure, the money offset the phasing-out of American economic grants to Israel as well as the massive sale of American arms to Arab countries. Still, the amount grew to just over $3 billion in 2008 with the start of President George W. Bush’s 10-year memorandum of understanding (MOU) with Israeli Prime Minister Ehud Olmert. In addition to the MOU annuity, Israel also sought “plus ups”—congressional grants for missile defense and other one-time expenditures, amounting to hundreds of millions of dollars. In time, this would make Israel the largest single recipient of American military aid since World War II, a total of more than $150 billion.

But that number is also misleading. The aid comes in the form of foreign military funding (FMF) designed to facilitate the foreign military sales (FMS) of American military equipment. This means that nearly three-quarters of the aid is spent in the United States, as a subsidy for the domestic arms industry, creating tens of thousands of jobs. Thanks to that money, the Israel Defense Forces have become the world’s most American-equipped army, with the largest fleets of F-16 and F-35 jets outside of the United States. For companies such as General Dynamics and Lockheed-Martin, there can be no better advertisement for their fighters than their use by Israel’s famed air force. And while Israel’s critics in the United States often claim that it receives the greatest amount of American aid, in fact Germany, Japan and South Korea get many times more. Their allotments, though, are not characterized as aid but as items in the U.S. defense budget.

Though generous, U.S. aid to Israel is hardly free. Under its terms, Israel cannot buy whatever it wants from the United States. Requests to buy Tomahawk missiles and strategic bombers have been routinely denied. Israel can buy the F-35 but cannot have access to its operating system. Israel cannot, moreover, sell what it wants to whomever it desires, most expressly to China. President Clinton vetoed Israel’s sale, worth $1 billion, of Phalcon reconnaissance planes to China, and President Bush nixed a $700 million deal of Harpy missiles.

Yet the value of U.S. defense aid to Israel could never be calculated merely in monetary terms. To Israel’s enemies, it sent an unequivocal message of superpower support. That message proved crucial during the Cold War and, later, in Israel’s conflicts with terrorist groups. It gave concrete expression to Congress’ 2008 commitment to ensure Israel’s qualitative military edge (QME), guaranteeing its “ability to counter and defeat any credible conventional military threat from any individual state or possible coalition of states or from non-state actors.” The message of American backing remained vital as Israel began to confront a new type of danger—not of tanks and planes but of boycotts and sanctions, of those who denied Israel not only the right to defend itself but also the right to exist.

For years, the arrangement proved so comfortable for both Americans and Israelis that few rose to challenge it. By 2015, though, the situation began to change. The Iran nuclear deal, negotiated behind Israel’s back and regarded by Israeli leaders as strategically threatening, greatly diluted the message of American support for Israel’s security. So, too, did America’s retreat from the Middle East, which began with President Barack Obama and accelerated under President Donald Trump. The progressive wing of the Democratic Party, meanwhile, expanding in size and influence, demanded a more pro-Palestinian American policy, and a much tougher stand on Israel. Asked during the 2020 presidential race whether they would use American aid as leverage to pry diplomatic concessions from Israel, Democratic candidates Elizabeth Warren, Bernie Sanders, Beto O’Rourke and Pete Buttigieg all replied “yes.” Asked by Israeli journalist Zvika Klein why young American Jews protest against Israel rather than Iran or Syria, Peter Beinart explained, “As Americans, we don’t provide $3 billion in military aid to Iran or Syria … without us, Israel couldn’t do everything it does.”

In fact, Israel today receives $3.8 billion annually, according to the MOU signed by Obama and then-Prime Minister Benjamin Netanyahu in 2016. But even with that increase, the aid no longer influences Israeli decision-making to the extent it once did. Back in 1985, American aid represented nearly one-half of Israel’s defense budget. Today, it accounts for only 19%. Moreover, under the Bush MOU, Israel was able to keep 26.3% of the aid—off-shore procurement (OSP)—to develop military capabilities specific to its needs. But the Obama MOU phases out the OSP, further reducing its importance to Israel’s security.

Behind closed doors, Israelis are questioning why a country as militarily and economically robust as theirs should continue to appear dependent on any foreign power. Why, they wonder, should Israel bear the opportunity costs of many billions of dollars by not selling its defense technologies to certain countries? And why should Israel, still a vulnerable country in the world’s toughest region, allow itself to be seen as open to progressive arm-twisting? Isn’t it time—with the Obama MOU set to expire in 2027—to begin asking whether Israel can continue to depend on U.S. military aid, whether its downsides outweigh its benefits, and whether or not more secure and mutually advantageous alternatives exist?

The answers to these questions may well lie in moving from the current donor-to-recipient model to a collaborative relationship based on both countries’ interests and strengths. Such an arrangement would provide for investment in joint research in artificial intelligence, directed energy (lasers), and cyber—all fields in which Israel excels. Such cooperation would bring immediate benefits to American and Israeli security and strengthen their abilities to counter common threats. “The U.S. and like-minded allies must lead in the development of emerging critical technologies,” I was told by Enia Krivine, senior director of the Israel Program and the National Security Network at the Foundation for Defense of Democracies. “The U.S. must invest in Israel and other techno democracies who share our values to secure the future.”

And nothing, it might be added, would be a better response to those legislators who are willing to cause harm to the Palestinians—and perhaps even to America—in order to attack Israel. Nothing could more effectively stimulate economic growth while contributing to Middle East security, and nothing could be more befitting for two sovereign, democratic states. In this way, perhaps, the blocking of aid for Iron Dome would not only be a wakeup call but also an opportunity for Israel and the United States to place their relationship on a more equitable and durable foundation.

Michael Oren, formerly Israel’s Ambassador to the United States, a Member of the Knesset, and Deputy Minister in the Prime Minister’s Office, is the author of “To All Who Call in Truth” (Wicked Son, 2021).

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