Clinton-Hussein-Rabin Photo-Op Will Cost U.S. Taxpayers $1 Billion

By Ella Bancroft

The point of bringing King Hussein of Jordan and Prime Minister Yitzhak Rabin of Israel to the U.S. for a July 25 ceremony "to terminate the state of belligerency" between their two countries that effectively ended a quarter of a century ago was to create a "foreign policy success" for U.S. President Bill Clinton before the 1994 congressional elections.

To lure them to the U.S. for a "Washington Declaration" formalizing their agreement, American promises were made to both Middle East parties. The promise made to the Jordanian monarch was to forgive his country's $700 million debt to the U.S. government, and to supply him with additional sophisticated American weaponry.

The promise to Rabin was the same made to him last year and the year before—that the level of U.S. aid to Israel would not be changed. That the U.S. is as good as its word was amply demonstrated last year. In a fit of unaccustomed probity, the U.S. Congress had written into the foreign aid bill for fiscal year 1993 the provision that a dollar would be deducted from Israel's foreign aid for every dollar Israel spent on the illegal Jewish settlements being built on the West Bank and Gaza. Later, Israel admitted it had spent $437 million on the settlements during fiscal year 1993, which meant that $437 million had to be deducted from its U.S. aid for fiscal year 1994.

The money was deducted, but since President Clinton already had promised no reduction in Israeli aid, he simply ponied up an additional $500 million in U.S. taxpayer funds to offset the penalty imposed on Israel for defying the United States. Clinton's action netted the Israeli government a $63 million profit it wouldn't have received if it had obeyed the wishes of Congress.

Not surprisingly, the Israeli government has continued to spend money on the settlements in 1994, although much of the West Bank housing it continues to build remains empty. Many of the new Jewish settlers moving in now are the same ones who are telling journalists they would move back into Israel proper if the U.S. would compensate them so that they can buy housing in Israel to replace the houses they would have to vacate.

It's an interesting proposition. The U.S. pays Israel a dollar for every dollar it spends on the settlements. Then when the settlers vacate, it will be on condition that the U.S. pays again to build new houses for them inside Israel. What's even more astonishing are indications in the Israeli press that, if the settlers ultimately have to vacate the West Bank as part of a final peace agreement, Israel expects to destroy the West Bank and Gaza settlements it has created.

That means that if the settlement lands are returned to the Palestine National Authority to be used to provide housing for Palestinians, the U.S. and international agencies would be expected to finance the building of new houses all over again on the same sites in the West Bank and Gaza. Crazy as it sounds, there is a precedent for this.

When Israel finally pulled out of the Sinai as stipulated in the Camp David framework for Israeli-Egyptian peace, it destroyed the military air bases built there, largely at U.S. expense. The U.S., in turn, provided funding for Israel to build replacement air bases inside Israel itself.

As for the Jewish settlement at Yammit in Sinai, it was completely razed by the Israeli government after the Jewish settlers were evacuated under protest. The Jewish settlers were compensated for the houses the Israeli government destroyed with money to buy new houses in areas under Israeli government control. Many of them have spent the money on Israeli government-subsidized housing in Jewish settlements in Gaza and the West Bank. They assume that when the final Israeli-Palestinian agreement is signed, they will be compensated all over again for pulling out all over again. Both Israelis and Palestinians call these "professional" settlers "land speculators."

With that kind of churning of U.S. aid, it's no wonder that the total of U.S. grants and loan guarantees to Israel reached $6.321 in fiscal year 1993, has remained there for 1994 and will remain there in 1995 thanks to Clinton's promises.

It's a figure you'll never read in the mainstream press, however. For many years, as the total of U.S. foreign aid crept up to $3 billion, the press would refer either to "Israel's $1.8 billion in U.S. military assistance" or "Israel's $1.2 billion in U.S. economic assistance." Both figures were correct, but journalists who used them deliberately misled readers by not mentioning the combined total figure of $3 billion. This year, in extensive coverage of the Jordan-Israel agreement in July, mainstream media finally began referring to "Israel's $3 billion in foreign aid." However, by now the total in direct U.S. taxpayer grants to Israel has passed $4 billion (see box on next page).

Nor does the press mention the annual $2 billion in loan guarantees, which began in fiscal year 1993 and will continue for a total of five years, or $10 billion. Asked why they do not include these guarantees, which bring the total of annual U.S. taxpayer aid to Israel, conservatively calculated, to $6.321 billion annually, journalists quote statements by lobbyists for Israel that "these are loans and Israel has never defaulted on a loan."

Such statements can be described, at best, as "true lies." In fact, Israel has never had to default because it has never had to repay a loan from the U.S. government. It has never repaid a U.S. government loan because all, eventually, are forgiven by a compliant U.S. Congress. In the case of those that have not yet been forgiven, the "Cranston amendment," first attached to the U.S. foreign aid bill for fiscal year 1984, stipulates that annual U.S. economic aid to Israel may never dip below the total of annual interest due on still outstanding U.S. government loans to Israel.

It often is argued that foreign aid is not a total loss to the U.S. taxpayer, since it is spent for U.S. goods that create jobs for Americans. This can truthfully be said about U.S. aid to most countries, but it is not entirely true in the case of Israel.

Although Israel is one of the world's tiniest countries in terms of population, it receives well over one-third of total U.S. foreign aid worldwide. Yet, in all other countries receiving U.S. economic aid, a USAID mission within the U.S. Embassy audits all expenditures.

There is no such AID mission in the U.S. Embassy in Israel—the only exception to this procedure in the world. Therefore, a great deal of the money has been lost to corruption, as was demonstrated in the well-known General Electric scandal, in which that company's manager for Israel was paying kickbacks to Israeli procurement authorities. In another case, Israeli General Rami Dotan was jailed oncharges he had siphoned off U.S. military assistance funds for personal use. What did not emerge from his secret trial was that he was able to do this because he apparently was acting under Israeli government orders to divert large quantities of U.S. aid funds to finance Israeli intelligence projects abroad.

As is the case with U.S. economic assistance, in the disbursement of U.S. military assistance to Israel many exceptions to normal U.S. procedures have accumulated over the years. Israel has been permitted to use portions of the funds to purchase Israeli-made rather than American-made arms, and to subsidize Israeli military research and production rather than use the funds to purchase U.S. products.

U.S. funds were used for years to subsidize the production of the Lavi fighter aircraft in Israel for use by Israeli forces and for sale to the military commands of other countries, in competition with U.S. military aircraft. The program finally was discontinued without producing marketable military aircraft, but only after an enormous waste of U.S. taxpayer funds.

A similar fate probably awaits Israel's "Arrow" ground-to-air missile, for which Israel has drawn large amounts of U.S. funding without as yet producing rockets of any military value. Now Israel has told the U.S. that it probably can no longer afford to fund even the 28 percent of the project it is committed to finance. The Pentagon, which had the project foisted upon it by Congress, long ago said it has no use for the Arrow missiles, which the U.S. is funding solely for use by Israel, and for Israel to market abroad in competition with U.S.-made missiles.

Given the huge annual American aid subsidies, now amounting to more than $1,000 per year for every one of Israel's five million men, women and children, it is no wonder that Israeli Deputy Foreign Minister Yossi Beilin has begun admonishing American Jews against collecting their own funds to send to Israel.

"We are not a poor country," he explains over and over to visiting delegations from American Jewish organizations, citing an annual per capita GNP that puts Israel in the top 20 countries worldwide. He has asked American Jews to continue supporting U.S. taxpayer aid for Israel, but to use their own funds for "Jewish education" of their children and to enable every Jewish child in the world who wants to to travel at age 17 to spend some time in Israel. "We need your children, not your money," Beilin explains to his U.S. co-religionists, since Israel's U.S. lobby gets it all the money it needs. It is only willing Jewish immigrants to Israel that remain in dramatically short supply.

Israel is receiving $6.321 billion annually from American taxpayers. That breaks down to $17,317,808 U.S. taxpayer dollars per day, seven days per week, 52 weeks a year. Nor does that enormous figure take into account the funds the U.S. government pays Egypt, the Palestinians, and now Jordan for keeping the peace with Israel.

Commenting on the old slogan that Israelis "have made the desert bloom," Jordanian journalist Rami Khouri remarked many years ago, long before aid to Israel had reached its present astronomical level: "If I had all the money in foreign aid Israel had from the U.S., and all the European technicians who emigrated there, I could make trees grow out of cement." Now, after signing its "declaration of non-belligerency" with Israel, Jordan may have a chance to prove it.

Ella Bancroft, a free-lance political writer, is based in Washington, D.C.