US Aid to Israel

From Handshake to Embrace

by Martha Wenger
published in MER164

The US has provided over $50 billion in economic and military aid to Israel since 1949, more than to any other country. Israel has the highest GNP per capita of all US aid recipients ($6,810). In 1991 Israel will receive more US aid per capita ($686) than the total GNP per capita of many countries, including Egypt ($670), Morocco ($620), the Yemen Arab Republic ($590), Mauritania ($440), Sudan ($330) and Somalia ($280).

Total US Aid to Israel By Decades

Fiscal Year              $ Millions, Current       Percent Military

1949-1959                 652.9                         .06
1960-1969                 834.8                          30
1970-1979              16,309.2                         71        
1980-1989              28,052.3                         56
1990                        3,019.4                         59
1991 (requested)      3,000.0                         60

Total                       51,868.6                        60

Note: Published government figures; actual aid totals can be as much as 25 percent higher. Military aid here refers to Foreign Military Sales only. Much “economic” aid actually goes to pay off military debts to the US government.
Source: Israel: Foreign Assistance Facts, Congressional Research Service, March 15, 1990.

Timeline

1948-1958 US, reluctant to alienate Arab oil producers by selling arms directly, gives economic aid only.
1961 President Kennedy authorizes first direct arms sale: Hawk missiles.
1962 First US military aid (loans) to Israel.
June 1967 Six-Day War. Israel’s main military supplier, France, imposes arms embargo.
1968 Congress increases aid to Israel 450 percent. Military aid jumps from $7 million in 1967 to $25 million in 1968. US agrees to sell Israel 50 Phantom fighter bombers.
1970 Jordan’s “Black September” crisis; US sees Israel as means to combat Soviet influence in Arab world, increases military aid from $140 million in 1968-1970 to $1.15 billion in 1971-1973.
1973 October Arab-Israeli War. Congress passes $2.2 billion in emergency financial aid, increases military aid 800 percent.
1975 Israel signs Sinai II Accord with Egypt; US increases aid, all given as direct loans or grants for general budget support. 1976 Israel becomes largest annual recipient of US aid.
April 1978 Secretary of State finds Israel “may have violated” US law by using US-supplied weapons -- restricted to self-defense -- in invasion of Lebanon.
March 1979 Carter administration quadruples Israeli military aid to $4 billion as part of Egyptian-Israeli peace treaty; helps Israel build sophisticated new $1.1 billion air bases.
August 1979 Secretary of State again finds Israel “may have violated” US law by using US weapons in raids into Lebanon.
January 1980 President Reagan takes office; emphasizes “special relationship” with Israel.
1981 All US economic assistance converted from loans to grants.
June 1981 Israel uses US F-16 fighter planes to bomb Iraqi nuclear reactor. Secretary of State finds this “may have violated” US law.
July 1981 Israel uses US-supplied warplanes to bomb Beirut, killing hundreds.
November 1981 US and Israel sign Memorandum of Understanding on strategic cooperation.
December 1981 Israel annexes Syrian territory (Golan Heights); US suspends November agreement.
June 1982 Israel invades Lebanon. Secretary of State secretly notifies Congress Israel may have violated US weapons restrictions. Congress later increases military aid for 1983.
October 1983 President Reagan renews suspended 1981 strategic agreement.
November 1983 Memorandum of Understanding on military planning, joint maneuvers signed; US to pre-position military equipment in Israel.
1984 Congress approves $550 million to Israel to develop Lavi jet fighter.
June 1984 First US-Israel joint naval and air military exercises.
1985 Congress converts Israel’s military aid entirely to grants and “forgiven” loans, rescues Israeli economy with $1.5 billion -- largest economic aid package for one country since Vietnam war.
November 1985 US Navy analyst Jonathan Pollard arrested for stealing thousands of highly classified US military documents for Israel.
November 1986 Israeli involvement in Iran-contra made public.
January 1987 Israel admits that it has contracts to sell South Africa hundreds of millions of dollars worth of arms.
December 1987 US grants Israel “major non-NATO ally” status which allows it to buy US weapons at discounted prices.
April 1988 US and Israel sign five-year Memorandum of Agreement on strategic, economic and military cooperation. Israel becomes the “largest foreign participant” in Star Wars.
September 1989 US agrees to stockpile $100 million worth of military supplies in Israel which Israel could use in a crisis.
December 1989 US Embassy in Israel cables Washington that on economic grounds US could cut aid to Israel.
January 1990 Sen. Bob Dole (R-KS) proposes cutting 5 percent from foreign aid to top five recipients; State Department endorses.
April 1990 House of Representatives approves $400 million housing loan guarantee for Soviet Jews in Israel. Senate approval pending.

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