US and Israel near agreement on record-breaking defence aid package

August 14, 2016
A Lockheed Martin test pilot attends a presentation of the F-35 US fighter jet at the Israeli Air Force house in Herzliya, Israel, last April.

Washington - The United States and Israel are close to finalising an agreement over a military aid package under which the United States would pledge to provide Israel with up to $40 billion in military aid over ten years, sources in Washington say.

The United States has never prom­ised such a large amount of military aid to another country.

Israel receives just more than $3 billion a year in US military aid, which represents 25% of Israel’s de­fence budget. Various other finan­cial transfers and periodic emergen­cy funds — known in Washington budget circles as “plus-ups” — mean that in any given year significantly more US funds are actually provided to Israel.

The proposed new agreement, which will take the form of a memo­randum of understanding (MOU), is regarded by some as compensa­tion for Israel in light of the nuclear agreement the United States and other powers signed with Iran in 2015, a deal that Israel adamantly opposed. It would replace the 2007 MOU that promised Israel $30 bil­lion over ten years.

Israeli Prime Minister Binyamin Netanyahu has said that Israel re­quires $5 billion per year from the United States to meet the security challenge from Iran and that was his initial demand. The administration of US President Barack Obama is be­lieved to be negotiating for a pack­age that provides about $3.8 billion per year.

US Marines General Joseph Dun­ford, chairman of the US Joint Chiefs of Staff, met with his Israeli coun­terpart, Lieutenant-General Gadi Ei­zenkot, August 4th at the Pentagon. In a statement released by the Pen­tagon, Dunford stressed the close­ness of the US-Israeli relationship and said that he and Eizenkot dis­cussed “regional security issues”.

The aid package was not men­tioned but Eizenkot travelled to Washington along with Yaakov Nagel, the acting head of Israel’s National Security Council, to try to complete negotiations on the pro­posed MOU, which would go into force in 2018. Nagel met with US Na­tional Security Adviser Susan Rice at the White House.

Eizenkot also visited Utah where he inspected F-35 Joint Strike Fight­ers that will be delivered to Israel this year. The F-35, a stealth aircraft, has the capability of eluding Iranian air defence systems, allowing Israel the potential to launch a pre-emp­tive strike against Iran.

While many pro-Israel members of the US Congress have been urging the administration to finalise nego­tiations, unresolved issues remain.

The Obama administration has been demanding that the new MOU reduces the percentage of US mili­tary aid that is spent on Israeli-man­ufactured armaments. Under the existing aid package, 26.3% of US funds may be spent in Israel. Obama wants more of the US military aid — and eventually all of it — spent on weapons manufactured in the Unit­ed States.

Israel is the only recipient of US military aid that is allowed to use military assistance funds to support its own armaments industry. How­ever, according to a Reuters report, after initial resistance Israel agreed to phase out the special provision over a five-year period, although do­ing so will cause job losses in Israel’s armaments sector.

The Obama administration is also insisting that the new package for­bids “plus-ups” except in cases of extreme emergency. Israel likely will agree to this provision because it knows that with its strong support in Congress — and it is Congress that appropriates US funds — it is a virtu­ally meaningless concession.

The Obama administration appar­ently is eager to agree to a new deal before the president leaves office, in part to rebuff those who claim he has not been sufficiently supportive of Israel. Netanyahu also apparently wants to reach a deal with Obama, in part to challenge his domestic critics who claim that he has permanently damaged the US-Israel relationship because of his transparent hostility to Obama.

A ten-year deal reached now would solidify US support for Israel until 2028. Israel’s favourability rat­ings in the United States, especially among Democrats and young peo­ple, have been falling.