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DinoDoc
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AECCP loves Democracy
Sep 1999
time: 23:24
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quote:
Since 1973, Israel has cost the United States about $1.6 trillion. If divided by today's population, that is more than $5,700 per person.
This is an estimate by Thomas Stauffer, a consulting economist in Washington. For decades, his analyses of the Middle East scene have made him a frequent thorn in the side of the Israel lobby.
For the first time in many years, Mr. Stauffer has tallied the total cost to the US of its backing of Israel in its drawn-out, violent dispute with the Palestinians. So far, he figures, the bill adds up to more than twice the cost of the Vietnam War.
And now Israel wants more. In a meeting at the White House late last month, Israeli officials made a pitch for $4 billion in additional military aid to defray the rising costs of dealing with the intifada and suicide bombings. They also asked for more than $8 billion in loan guarantees to help the country's recession-bound economy.
Considering Israel's deep economic troubles, Stauffer doubts the Israel bonds covered by the loan guarantees will ever be repaid. The bonds are likely to be structured so they don't pay interest until they reach maturity. If Stauffer is right, the US would end up paying both principal and interest, perhaps 10 years out.
Israel's request could be part of a supplemental spending bill that's likely to be passed early next year, perhaps wrapped in with the cost of a war with Iraq.
Israel is the largest recipient of US foreign aid. It is already due to get $2.04 billion in military assistance and $720 million in economic aid in fiscal 2003. It has been getting $3 billion a year for years.
Adjusting the official aid to 2001 dollars in purchasing power, Israel has been given $240 billion since 1973, Stauffer reckons. In addition, the US has given Egypt $117 billion and Jordan $22 billion in foreign aid in return for signing peace treaties with Israel.
"Consequently, politically, if not administratively, those outlays are part of the total package of support for Israel," argues Stauffer in a lecture on the total costs of US Middle East policy, commissioned by the US Army War College, for a recent conference at the University of Maine.
These foreign-aid costs are well known. Many Americans would probably say it is money well spent to support a beleagured democracy of some strategic interest. But Stauffer wonders if Americans are aware of the full bill for supporting Israel since some costs, if not hidden, are little known.
One huge cost is not secret. It is the higher cost of oil and other economic damage to the US after Israel-Arab wars.
In 1973, for instance, Arab nations attacked Israel in an attempt to win back territories Israel had conquered in the 1967 war. President Nixon resupplied Israel with US arms, triggering the Arab oil embargo against the US.
That shortfall in oil deliveries kicked off a deep recession. The US lost $420 billion (in 2001 dollars) of output as a result, Stauffer calculates. And a boost in oil prices cost another $450 billion.
Afraid that Arab nations might use their oil clout again, the US set up a Strategic Petroleum Reserve. That has since cost, conservatively, $134 billion, Stauffer reckons.
Other US help includes:
• US Jewish charities and organizations have remitted grants or bought Israel bonds worth $50 billion to $60 billion. Though private in origin, the money is "a net drain" on the United States economy, says Stauffer.
• The US has already guaranteed $10 billion in commercial loans to Israel, and $600 million in "housing loans." (See editor's note below.) Stauffer expects the US Treasury to cover these.
• The US has given $2.5 billion to support Israel's Lavi fighter and Arrow missile projects.
• Israel buys discounted, serviceable "excess" US military equipment. Stauffer says these discounts amount to "several billion dollars" over recent years.
• Israel uses roughly 40 percent of its $1.8 billion per year in military aid, ostensibly earmarked for purchase of US weapons, to buy Israeli-made hardware. It also has won the right to require the Defense Department or US defense contractors to buy Israeli-made equipment or subsystems, paying 50 to 60 cents on every defense dollar the US gives to Israel.
US help, financial and technical, has enabled Israel to become a major weapons supplier. Weapons make up almost half of Israel's manufactured exports. US defense contractors often resent the buy-Israel requirements and the extra competition subsidized by US taxpayers.
• US policy and trade sanctions reduce US exports to the Middle East about $5 billion a year, costing 70,000 or so American jobs, Stauffer estimates. Not requiring Israel to use its US aid to buy American goods, as is usual in foreign aid, costs another 125,000 jobs.
• Israel has blocked some major US arms sales, such as F-15 fighter aircraft to Saudi Arabia in the mid-1980s. That cost $40 billion over 10 years, says Stauffer.
Stauffer's list will be controversial. He's been assisted in this research by a number of mostly retired military or diplomatic officials who do not go public for fear of being labeled anti-Semitic if they criticize America's policies toward Israel. |
http://www.csmonitor.com/2002/1209/p16s01-wmgn.html
Money well spent?
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My Wife Hates CIV
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Michigan
Jan 1970
time: 05:24
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yes
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My Wife Hates CIV
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Michigan
Jan 1970
time: 05:24
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but if a major conflict (not iraq) breaks out over there it's nice to have someone who can fight with you. someone who will fight just as dirty as everyone else.
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Edan
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quote:
Originally posted by chegitz guevara
I think it's terribly unreasonable that we should be asked to defray the costs of supressing a legitimate insurrection. Israel should pay for their gestapo tactics out of their own pocket. We'll help them defend themselves against external enemies. |
We only pay for about 20% of the Israeli Military costs - and I'm pretty sure that Israel has used less than 80% of their military - so your fears are unjustified.
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Dr Strangelove
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About one trillion dollars of the so called cost of supporting israel the author attributes to the OPEC oil embargo and price hikes. I don't think these items should be entirely laid at the doorstep of America's support for Israel. OPEC is not entirely an Arabic consortium, its members include Mexico, Venezuela, Nigeria, and Indonesia, none of whom had much interest in opposing American support for Israel in the 1970s. The oil embargo was just as much OPEC flexing its muscles as opposing US foreign policy. Furthermore, given the cold war climate of that era even if Israel hadn't existed there was bound to be conflict in that part of the world anyway. Eventually the oil cartel members would almost with certainty have asserted themselves in such a manner.
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Edan
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quote:
Originally posted by chegitz guevara
Try just about every newspaper from 1990, when the US forgive all of Israel's loans when they did the same for Egypt. |
I'm pretty sure you're wrong about that. I'm fairly sure that Egypt got it's loans forgiven, and Israel didn't (as it didn't want its credit rating messed up). OTOH, Israel probably got a grant to cover the billions of damage + cost from the Gulf War.
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Edan
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quote:
Originally posted by Gatekeeper
Interesting stuff.
The "buy Israel" bit is surprising. I'm sorry, but I'd rather have our military stuff be of American manufacture as much as possible, unless circumstances dictate otherwise. And since our industrial, technical and know-how capacity are far from diminished, such circumstances do not exist.
The part where Israel uses U.S. funds to buy military equipment from its own industries is a slap of sorts. I have no problem with them buying their own military stuff from domestic sources, but they should do so with their own money, not our aid. I'd rather use that 40 percent of the $1.8 billion or so for domestic purposes in the United States.
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You misunderstand, I think. Part of the aid package states that the aid has to be used on US manufactrors, IIRC, so Israel does spend a lot on American products.
quote:
Why would we help Israel develop its own jet fighters (Lavi) and missiles (Arrow)?
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Umm, much of those developments are developed jointly, like the Arrow system (as well as that neat-o laser beam thingy that was made recently)
quote:
Do we expect to gain something from this $2.5 billion subsidy? If so, it'd better be something along the lines of a next-generation benefit made available *now,* IMHO.
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We've already benefited greatly from Israel - Israel provided the west with it's first captured working Mig. Israel helped avert a war between Syria and Jordan in 1970. Israel set back Iraq's nuclear program 10 years, so that when Saddam attacked Kuwait, Iraq didn't have nuclear weapons. And Israeli intelligence has proved to be invaluable.
quote:
One final question: Is this how we do business with other nations? Do all nations do business this way? Just asking so we don't necessarily demonize Israel for doing something that might be quite commonplace among the nations of the world.
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Well, a good comparison would be how much the US spends militarily on Europe, Japan and South Korea (as well as actually having our troops there)
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Kontiki
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Canada
Aug 2001
time: 00:24
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quote:
Originally posted by Edan
I'm pretty sure you're wrong about that. I'm fairly sure that Egypt got it's loans forgiven, and Israel didn't (as it didn't want its credit rating messed up). OTOH, Israel probably got a grant to cover the billions of damage + cost from the Gulf War. |
Given that credit ratings directly correlate with how much debt you have outstanding and your ability to pay said debt, I should think that having your loans forgiven would be beneficial to Israel's credit rating.
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Edan
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quote:
Without direct aid (which, given 6 million inhabittants, comes out to about 500 dollars a person annually) the tax burden would really be murder in Israel. |
http://news.bbc.co.uk/2/hi/business/2564981.stm
I've seen a report by cnn that stated that if Israel recieved no aid, it would still survive (albeit, with a lower standard of living).
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GePap
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of the Big Apple
Nov 2001
time: 23:24
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quote:
Originally posted by Edan
You misunderstand, I think. Part of the aid package states that the aid has to be used on US manufactrors, IIRC, so Israel does spend a lot on American products. |
The original article makes it clear that Israel does not have to spend 100% of US aid money in the US, which is the standard clause
quote:
Umm, much of those developments are developed jointly, like the Arrow system (as well as that neat-o laser beam thingy that was made recently) |
THe US military does not expect to jointly produce the arrow system. Basically, the US is giving aid to Israeli companies to porduce this weapon. If the US wanted to get soem, it would have to buy them form the Israeli company.
quote:
We've already benefited greatly from Israel - Israel provided the west with it's first captured working Mig. Israel helped avert a war between Syria and Jordan in 1970. Israel set back Iraq's nuclear program 10 years, so that when Saddam attacked Kuwait, Iraq didn't have nuclear weapons. And Israeli intelligence has proved to be invaluable. |
Sadly, you can't prove that had the US spent its money otherwise results would have been worst, if not possibly better.
quote:
Well, a good comparison would be how much the US spends militarily on Europe, Japan and South Korea (as well as actually having our troops there) |
The US does not give aid, or loans to any of those states, those states pay for their own weapons, or buy directly from the US and US weapons manufacturers. The cost of US troops is divided in various ways. No other state has the sort of relationship with the US (economic) that Israel has. It is a singular relation.
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Edan
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quote:
Israel has blocked some major US arms sales, such as F-15 fighter aircraft to Saudi Arabia in the mid-1980s. That cost $40 billion over 10 years, says Stauffer.
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How many transactions by Israel has the US blocked?
BTW, IIRC, aid to Israel will be dropping slowly from 3 billion to about 2.5 billion(?) in the near future, at Israel's request, IIRC.
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Edan
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quote:
The US does not give aid, or loans to any of those states, those states pay for their own weapons, or buy directly from the US and US weapons manufacturers. The cost of US troops is divided in various ways. No other state has the sort of relationship with the US (economic) that Israel has. It is a singular relation. |
Again, you miss my point. Economic help, be it through foreign aid or through military aid is still economic aid. How much money do those countries save by not having to maintain large armies in order to guarantee security.
Would you rather have American troops in Israel and no aid, even if it would cost more?
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Edan
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quote:
THe US military does not expect to jointly produce the arrow system. Basically, the US is giving aid to Israeli companies to porduce this weapon. If the US wanted to get soem, it would have to buy them form the Israeli company.
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http://www.cnn.com/2000/WORLD/meast...sile/index.html
"The Arrow missile -- a joint project with the United States -- is meant to intercept missiles at high altitudes and far away from their targets."
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23-12-2002 22:27
Huh? Israel has never defaulted on a loan, so where are you pulling the prediction out of?
, opposing US military grants to Arab states, so forth and so on. All in all, Israel is a very uppitty lackey, but US frgiveness in this area s boundless (for now)
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