Monday July 15, 2024

Aid, appeasement and strategic assets

By Dr Murad Ali
December 26, 2017

President Trump’s decision to recognise Jerusalem as Israel’s capital is an unprecedented step and has been considered “a major break with his predecessors”. He did what various presidents, both Republican and Democrat, could not do despite the fact that the US-Israel relationship has mostly remained ‘exceptional’ and ‘unique in history’.

The decision to recognise Jerusalem as Israel’s capital is condemnable and has been rightly criticised even by close European allies of the US. The issue is undoubtedly sensitive and close to the hearts of over a billion Muslims across the world. Irrespective of that, and even if one shuns one’s own biases and prejudices, the decision is a slap on the face of history and international norms, values and obligations.

Although from time to time the US has backed negotiations between Israel and Palestine to give the impression of being a neutral third party, the ties between Israel and the US and the way the US has supported Israel by providing both economic and military aid as well as by extending unflinching diplomatic support at the UN Security Council, International Court of Justice and various other international forums, makes it evident that the US has always sided with Israel – sometimes in blatant violation of international norms and principles.

When David Ben-Gurion proclaimed the establishment of the State of Israel on May 14, 1948, following the end of the British mandate in Palestine, it took the administration of then US president Truman 11 minutes to recognise the Jewish state. Ben-Gurion, the founding father of Israel, later became the first prime minister of the country. Although the US started providing economic aid to Israel, relations were troubled in the early 1950s. Both Truman and his successor Eisenhower realised that getting too close to Israel could harm America’s relations with the Arab world. That is why the US also voiced strong opposition to the Israeli campaign against Egypt in 1956, launched in coordination with France and Britain and known as the Suez Crisis. It was under American pressure that Israel later withdrew from the Sinai.

The US gave considerable economic and military to Israel during the 1950s and early 1960s. The Six-Day War of 1967, though, was a turning point for the US, which thereafter became Israel’s main backer. During the June 1967 Arab-Israeli war, Israel occupied the Sinai, the Gaza Strip, the West Bank, east Jerusalem and the Golan Heights. Israel’s victory over its Arab opponents put it politically, diplomatically and strategically in a much stronger position. It is argued that the triumph of Israel was “an American gain as well, since both Egypt and Syria were close allies of the Soviet Union and their defeat was considered a major blow to Kremlin’s prestige in the region”. There was a consensus that the war was “a disaster of great proportions for Moscow, and a commensurate gain for the United States” in the cold-war background.

This is how the US started to view a strong Israel as a strategic asset against Soviet influence in the region. Consequently, the volume of US assistance to Israel increased enormously during these years. The US was not offering Israel “billions of dollars in military and economic aid merely out of a sense of moral obligation” but because the US now saw Israel as a vital strategic partner. Hence, due to mutual geo-strategic, political and security interests, US economic and military aid to Israel increased markedly in the coming years and decades.

US-Israel ties are usually labelled ‘unique’, ‘special’ and ‘unprecedented’. Regarding the provision of American economic and military aid to Israel over the last nearly seven decades, here are some astonishing facts. The US has allocated Israel a total of over $63 billion economic and over $141 billion military assistance, more than $200 billion in aggregate [as per USAID “US Overseas Loans and Grants” (Greenbook)]. Remember, the total population of Israel is just over eight million and its GDP per capita is $33,700. On account of its GDP per capita, Israel is considered among the 40-50 richest nations in the world.

In the 1990s, the total US aid to Israel was approximately one-third of the entire US foreign aid budget, even though Israel comprised just .001 percent of the world population. Therefore, US aid for Israel is not due to poverty but because of shared geo-strategic and security goals. Most significantly, the Zionist lobby within the US, particularly the extremely powerful and well-organized American Israel Public Affairs Committee (AIPAC), founded in 1951, is one of the most influential players persuading US foreign policy in favour of Israel.

Israel is also exempted from the various conditions that all other US aid recipients are supposed to fulfil before aid is actually allocated. All other countries receiving US aid are granted the allocated amount in quarterly instalments while aid to Israel has, since 1982, been given as a lump sum at the start of each fiscal year. This exceptional concession enables Israel to reinvest this amount in US treasury notes, allowing it to earn significant money in interest paid by US taxpayers. In order to provide Israel the entire amount in this manner, it costs the US government $50-60 million annually in additional bank charges, which are not deducted from the money given to Israel. Another unique aspect of the ties is that there are no strings attached to US aid regarding how and where to spend it; there is also no resident USAID mission to supervise the aid programme of Israel for Washington’s review.

While US economic assistance to Israel has significantly decreased in recent years; from about $2 billion in 1997 to $46 million in 2008 and ceased after 2011 as it is an OECD member, the case of military aid is altogether different. Under their 2007 Memorandum of Understanding (MoU), a total of $30 billion Foreign Military Financing (FMF) was provided to Israel over the course of the decade, more than a quarter of which Israel was able to spend within the country to further strengthen its domestic arms industry. During their recent MoU signed on September 14, 2016, covering FY2019- FY2028, a total of $38 billion ($3.8 billion per year) will be provided to Israel. This will succeed the current $30 billion MOU, signed in 2007, which will expire at the end of FY2018. The irony is that Israel’s entire defence budget this fiscal year was about $16 billion, so US assistance is approximately a fifth of what Tel Aviv spends on its own military.

Overall, the aid policies of the US towards Israel clearly illustrate how the Americans have consistently allocated substantial economic and military aid for the Jewish state; this is regardless of whether there is a Republican or Democrat president in the White House. However, President Trump has managed to trump his predecessors in appeasing Israel by unilaterally recognising Jerusalem as Israel’s capital, leaving the poor Palestinians red-faced. Again, what is even more embarrassing has been the lacklustre response of the Arab world to this step.

The writer is a postdoctoral research fellow at the German Development Institute at Bonn, Germany.