Dollars & Sense

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21 August 2012

Thank you very much but we don’t need it, anymore!

Isn’t it time to refuse American Foreign Aid?

Here’s a radical thought. Israel receives about $US3.2 billion each year from the US Foreign Aid budget. Let’s tell them, Thank you very much but we don’t need it, anymore!

Anyone who frequents an open forum on the Middle East (let’s face it the M.E. is usually reduced to Israel ignoring what goes on in the other states and um ‘disputed areas’) or reads online newspapers will eventually come across a comment or post like this: America should punish Israel for her crimes/put pressure on Israel for her own good and stop sending it money. The subtext on this not very subtle coded message, if you are a former British ambassador or a Destroy Israel Lobbyist from Seattle,  is Jews are money-grubbers. The way to get to them is through their pockets.

You could argue, as the I’m not antisemitic, I’m only a critic of Israel’s policies crowd is prone, that America is in a financial mess and the money could be better spent elsewhere. It’s a legitimate claim that is easily tested. Does the critic ask to cut aid to Muslim Egypt, Jordan, the Palestinian Authority and Pakistan or is it only the sole Jewish state that is to be held responsible for America’s too-large-to-be-really-imagined debt? Does the critic note that ‘aid’ to Iraq and Afghanistan dwarf aid to Israel and indeed all other countries combined? Is the critic financially savvy enough to note that the amounts paid through the N.A.T.O. budget are fungible (reduce spending on defence allow increased spending on other items) and country-by-country assistance exceeds aid to Israel? Does the critic even give one line to the possibility that aid to Israel is in America’s best interest?

Israel says NO Where does that leave America?

Israel’s Gross Domestic Product (GDP) is an estimated $US238.2 billion. Revenues are $66.6 billion a year and expenditures $74.8 billion. Or to put it another way Israel lives beyond her means (so do I) but not to the extent that informing America that we no longer will be taking her money or would be taking less would be catastrophic. It wouldn’t actually make that much difference to America either. The U.S. spent $663,255,000,000 on military spending in 2009†. Aid to Israel comes to 0.0000000005% of total defence spending. Well, every cent counts – or does it?

Pluses and minuses

Israel weaning itself of the American teat (may I suggest from 100% to 0% in 5 years) produces some surprising results and America may not even be really happy about it.  Every Presidential, Congressional and Senate inquiry over the years has come to the same conclusion. American aid to Israel is in American interest. Firstly it is an indirect subsidy to American industry and American jobs because Israel unlike say Greece or Iceland is obliged to spent it’s aid in America. Secondly, Israel tests and improves the equipment under genuine battle conditions. That, in itself, is probably worth the aid it gets. Thirdly, every time Israel clobbers an adversary it proves the superiority of the American product and that attracts sales. It’s a little like sitting in a restaurant to attract customers.

Lastly and not leastly. Israel by simply being here, willing and able to fight means America doesn’t have to be. This was true during the Cold War when Israel’s effective control of the Western Mediterranean was a factor in America not having to station a fleet. This was true even though Israel didn’t take an active part in the first Gulf War, give or take a bushel of Scud missiles landing on us, but just by being here stopped Saddam Hussein from smuggling in  the supplies he desperately needed. Just imagine how different the war would have looked if Israel hadn’t taken out the Osirak reactor and the Iraqis had had an atomic weapon and the means to launch it. Others will have to report on counter-terrorism, intelligence and technology useful in urban warfare. Put a price on it.

While sacrificing the annual sum would hurt there are benefits to Israel. It would be seen by an already overwhelmingly friendly American people as an enormous good will gesture. Can anyone name a similar gesture by any other American ally? It, would at one stroke, hobble the American President’s ability to put pressure on Israel. It would reduce Israel’s total reliance on American weaponry and make it an attractive customer for arms from other countries. Saudi Arabia has been doing this for years. Also, and not before time, it should force Israel to greater efficiency. Not least, it would take a great deal of wind out of our enemies sails. An Israel without foreign aid leaves the way open for elimination of aid to Egypt, Jordan and the Palestinian Authority. Isn’t that a win-win for Israel?

By the way. Why does no one ever ask why the investment of half a billion US dollars a years in the Palestinians has bought America so little interest?

US/Israel mutual benefit


So much of America’s military spending is secret that gaining accurate figures is nigh impossible. How much does U.S. spend? by George Vierra seems as accurate a public accounting as any I have seen. I will gladly accept correction.

About David Guy

B.A./B.C.A. (Communication and Media Arts) University of Wollongong, AUSTRALIA M.A. in Government (Diplomacy and Conflict Studies) Inter Disciplinary Center, Herzliya, ISRAEL Twitter @5MFI
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