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Sunday, February 27, 2011

Time to give up American aid money?

Caroline Glick writes that Israel can and should give up its American aid money to enhance its own freedom of action.
The Palestinians’ declared readiness to forgo US aid is all the more remarkable when compared to Israel’s refusal to countenance the thought of forgoing or even cutting back the assistance it receives from the US. Whereas the Palestinian economy will collapse without US assistance, were Israel to forgo the $3b. in military assistance it receives every year from Washington, the move would have little impact on the economy.

Economic analyses of US military assistance have noted that several factors degrade the value of the aid. The US requires Israel to spend 75 percent of the assistance in the US. Israel’s inability to open its purchases to competitive bidding in the world market has forced it to pay inflated prices for much of what it buys.

So, too, by buying US weapons systems, Israel has harmed its own military industries, which are blocked from selling or developing systems for the IDF contractors.

Moreover, because the US has tied its aid to Egypt to its aid to Israel and justified its military aid to Jordan and Lebanon through its military assistance to Israel, by accepting the aid, Israel is enabling its neighbors to upgrade their military capabilities. Their upgraded military capabilities in turn force Israel to invest still more resources in its defense budget to maintain its qualitative edge against its US subsidized neighbors.

With all the hidden costs the military assistance entails, it is reasonable to discount the actual value of the aid by 50%. That is, the actual value of annual US military assistance is about $1.5b.

The direct military cost of the Second Lebanon War is estimated at $2.2b. The direct military cost of Operation Cast Lead is estimated at $1.4b. The actual costs of both wars to the Israeli economy were several times higher.

Those who claim that Israel cannot manage without US military aid ignore the fact that neither of these wars had any discernible impact on the economy.

The political cost Israel has paid for US military assistance has been astronomical. As a recent study of US military assistance by the Jerusalem Institute for Market Studies demonstrated, the psychological impact of the US aid on Israeli and American leaders alike has had a disastrous impact on the relations between the two states and impaired their ability to understand the actual strategic rationale of their alliance. Israeli leaders have developed a subservient mentality towards the Americans and the Americans have forgotten that a strong Israel is the US’s most valuable strategic asset in the region.

THE PALESTINIANS’ expressed willingness to forgo their assistance from the US is no doubt a bluff. And Congress would do well to call their bluff and cancel US assistance to the PA.
Read the whole thing.

I have mixed emotions about this issue, but I'm beginning to come around to the view that we would be better off without the US aid money.

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At 7:32 AM, Blogger NormanF said...

Carl - that's been been my view for a long time.

Dependency does a country no good. It breeds servility and it has conditioned Israel to subordinate its vital national interests to the needs of its patron.

And it has deprived Israel of developing the economic and military self-sufficiency it needs to survive in a dangerous neighborhood.

The sooner Israel relinquishes the American aid, the better off the Jewish State will be in the future.

At 9:16 PM, Blogger Batya said...

We don't get aid, in the true sense. We get shopping coupons to "buy in America" to strengthen the American economy and weaken the Israeli one. We would be richer without it.


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