[THS] Richard H. Curtiss: The Cost of Israel to US Taxpayers

[Peter Webster]

http://www.informationclearinghouse.info/article23627.htm

True Lies

The Cost of Israel to US Taxpayers

By Richard H. Curtiss
Former U.S. Foreign Service Officer

October 03, 2009 "WRMEA" -- For many years the American media said that “Israel
receives $1.8 billion in military aid” or that “Israel receives $1.2 billion in economic
aid.” Both statements were true, but since they were never combined to give us the
complete total of annual U.S. aid to Israel, they also were lies—true lies.

Recently Americans have begun to read and hear that “Israel receives $3 billion in
annual U.S. foreign aid.” That's true. But it's still a lie. The problem is that in fiscal
1997 alone, Israel received from a variety of other U.S. federal budgets at least
$525.8 million above and beyond its $3 billion from the foreign aid budget, and yet
another $2 billion in federal loan guarantees. So the complete total of U.S. grants
and loan guarantees to Israel for fiscal 1997 was $5,525,800,000.

One can truthfully blame the mainstream media for never digging out these figures
for themselves, because none ever have. They were compiled by the Washington
Report on Middle East Affairs. But the mainstream media certainly are not alone.
Although Congress authorizes America's foreign aid total, the fact that more than a
third of it goes to a country smaller in both area and population than Hong Kong
probably never has been mentioned on the floor of the Senate or House. Yet it's
been going on for more than a generation.

Probably the only members of Congress who even suspect the full total of U.S. funds
received by Israel each year are the privileged few committee members who actually
mark it up. And almost all members of the concerned committees are Jewish, have
taken huge campaign donations orchestrated by Israel's Washington, DC lobby, the
American Israel Public Affairs Committee (AIPAC), or both. These congressional
committee members are paid to act, not talk. So they do and they don't.

The same applies to the president, the secretary of state, and the foreign aid
administrator. They all submit a budget that includes aid for Israel, which Congress
approves, or increases, but never cuts. But no one in the executive branch mentions
that of the few remaining U.S. aid recipients worldwide, all of the others are
developing nations which either make their military bases available to the U.S., are
key members of international alliances in which the U.S. participates, or have
suffered some crippling blow of nature to their abilities to feed their people such as
earthquakes, floods or droughts.

Israel, whose troubles arise solely from its unwillingness to give back land it seized in
the 1967 war in return for peace with its neighbors, does not fit those criteria. In
fact, Israel's 1995 per capita gross domestic product was $15,800. That put it below
Britain at $19,500 and Italy at $18,700 and just above Ireland at $15,400 and Spain
at $14,300.

All four of those European countries have contributed a very large share of
immigrants to the U.S., yet none has organized an ethnic group to lobby for U.S.
foreign aid. Instead, all four send funds and volunteers to do economic development
and emergency relief work in other less fortunate parts of the world.

The lobby that Israel and its supporters have built in the United States to make all
this aid happen, and to ban discussion of it from the national dialogue, goes far
beyond AIPAC, with its $15 million budget, its 150 employees, and its five or six
registered lobbyists who manage to visit every member of Congress individually once
or twice a year.

AIPAC, in turn, can draw upon the resources of the Conference of Presidents of Major
American Jewish Organizations, a roof group set up solely to coordinate the efforts of
some 52 national Jewish organizations on behalf of Israel.

Among them are Hadassah, the Zionist women’s organization, which organizes a
steady stream of American Jewish visitors to Israel; the American Jewish Congress,
which mobilizes support for Israel among members of the traditionally left-of-center
Jewish mainstream; and the American Jewish Committee, which plays the same role
within the growing middle-of-the-road and right-of-center Jewish community. The
American Jewish Committee also publishes Commentary, one of the Israel lobby’s
principal national publications.

Perhaps the most controversial of these groups is B’nai B’rith’s Anti-Defamation
League. Its original highly commendable purpose was to protect the civil rights of
American Jews. Over the past generation, however, the ADL has regressed into a
conspiratorial and, with a $45 million budget, extremely well funded hate group.

In the 1980s, during the tenure of chairman Seymour Reich, who went on to become
chairman of the Conference of Presidents, ADL was found to have circulated two
annual fund-raising letters warning Jewish parents against allegedly negative
influences on their children arising from the increasing Arab presence on American
university campuses.

More recently, FBI raids on ADL’s Los Angeles and San Francisco offices revealed that
an ADL operative had purchased files stolen from the San Francisco police
department that a court had ordered destroyed because they violated the civil rights
of the individuals on whom they had been compiled. ADL, it was shown, had added
the illegally prepared and illegally obtained material to its own secret files, compiled
by planting informants among Arab-American, African-American, anti-Apartheid and
peace and justice groups.

The ADL infiltrators took notes of the names and remarks of speakers and members
of audiences at programs organized by such groups. ADL agents even recorded the
license plates of persons attending such programs and then suborned corrupt motor
vehicles department employees or renegade police officers to identify the owners.

Although one of the principal offenders fled the United States to escape prosecution,
no significant penalties were assessed. ADL’s Northern California office was ordered
to comply with requests by persons upon whom dossiers had been prepared to see
their own files, but no one went to jail and as yet no one has paid fines.

Not surprisingly, a defecting employee revealed in an article he published in the
Washington Report on Middle East Affairs that AIPAC, too, has such “enemies” files.
They are compiled for use by pro-Israel journalists like Steven Emerson and other so-
called “Terrorism experts,” and also by professional, academic or journalistic rivals of
the persons described for use in blacklisting, defaming, or denouncing them. What is
never revealed is that AIPAC’s “opposition research“ department, under the
supervision of Michael Lewis, son of famed Princeton University Orientalist Bernard
Lewis, is the source of this defamatory material.

But this is not AIPAC’s most controversial activity. In the 1970s, when Congress put a
cap on the amount its members could earn from speakers’ fees and book royalties
over and above their salaries, it halted AIPAC’s most effective ways of paying off
members for voting according to AIPAC recommendations. Members of AIPAC’s
national board of directors solved the problem by returning to their home states and
creating political action committees (PACs).

Most special interests have PACs, as do many major corporations, labor unions, trade
associations and public-interest groups. But the pro-Israel groups went wild. To date
some 126 pro-Israel PACs have been registered, and no fewer than 50 have been
active in every national election over the past generation.

An individual voter can give up to $2,000 to a candidate in an election cycle, and a
PAC can give a candidate up to $10,000. However, a single special interest with 50
PACs can give a candidate who is facing a tough opponent, and who has voted
according to its recommendations, up to half a million dollars. That’s enough to buy
all the television time needed to get elected in most parts of the country.

Even candidates who don’t need this kind of money certainly don’t want it to become
available to a rival from their own party in a primary election, or to an opponent from
the opposing party in a general election. As a result, all but a handful of the 535
members of the Senate and House vote as AIPAC instructs when it comes to aid to
Israel, or other aspects of U.S. Middle East policy.

There is something else very special about AIPAC’s network of political action
committees. Nearly all have deceptive names. Who could possibly know that the
Delaware Valley Good Government Association in Philadelphia, San Franciscans for
Good Government in California, Cactus PAC in Arizona, Beaver PAC in Wisconsin, and
even Icepac in New York are really pro-Israel PACs under deep cover?
Hiding AIPAC’s Tracks

In fact, the congress members know it when they list the contributions they receive
on the campaign statements they have to prepare for the Federal Election
Commission. But their constituents don’t know this when they read these statements.
So just as no other special interest can put so much “hard money” into any
candidate’s election campaign as can the Israel lobby, no other special interest has
gone to such elaborate lengths to hide its tracks.

Although AIPAC, Washington’s most feared special-interest lobby, can hide how it
uses both carrots and sticks to bribe or intimidate members of Congress, it can’t hide
all of the results.

Anyone can ask one of their representatives in Congress for a chart prepared by the
Congressional Research Service, a branch of the Library of Congress, that shows
Israel received $62.5 billion in foreign aid from fiscal year 1949 through fiscal year
1996. People in the national capital area also can visit the library of the U.S. Agency
for International Development (USAID) in Rosslyn, Virginia, and obtain the same
information, plus charts showing how much foreign aid the U.S. has given other
countries as well.

Visitors will learn that in precisely the same 1949-1996 time frame, the total of U.S.
foreign aid to all of the countries of sub-Saharan Africa, Latin America and the
Caribbean combined was $62,497,800,000--almost exactly the amount given to tiny
Israel.

According to the Population Reference Bureau of Washington, DC, in mid-1995 the
sub-Saharan countries had a combined population of 568 million. The
$24,415,700,000 in foreign aid they had received by then amounted to $42.99 per
sub-Saharan African.

Similarly, with a combined population of 486 million, all of the countries of Latin
America and the Caribbean together had received $38,254,400,000. This amounted
to $79 per person.

The per capita U.S. foreign aid to Israel’s 5.8 million people during the same period
was $10,775.48. This meant that for every dollar the U.S. spent on an African, it
spent $250.65 on an Israeli, and for every dollar it spent on someone from the
Western Hemisphere outside the United States, it spent $214 on an Israeli.
Shocking Comparisons

These comparisons already seem shocking, but they are far from the whole truth.
Using reports compiled by Clyde Mark of the Congressional Research Service and
other sources, freelance writer Frank Collins tallied for the Washington Report all of
the extra items for Israel buried in the budgets of the Pentagon and other federal
agencies in fiscal year 1993.Washington Report news editor Shawn Twing did the
same thing for fiscal years 1996 and 1997.

They uncovered $1.271 billion in extras in FY 1993, $355.3 million in FY 1996 and
$525.8 million in FY 1997. These represent an average increase of 12.2 percent over
the officially recorded foreign aid totals for the same fiscal years, and they probably
are not complete. It’s reasonable to assume, therefore, that a similar 12.2 percent
hidden increase has prevailed over all of the years Israel has received aid.

As of Oct. 31, 1997 Israel will have received $3.05 billion in U.S. foreign aid for fiscal
year 1997 and $3.08 billion in foreign aid for fiscal year 1998. Adding the 1997 and
1998 totals to those of previous years since 1949 yields a total of $74,157,600,000 in
foreign aid grants and loans. Assuming that the actual totals from other budgets
average 12.2 percent of that amount, that brings the grand total to $83,204,827,200.

But that’s not quite all. Receiving its annual foreign aid appropriation during the first
month of the fiscal year, instead of in quarterly installments as do other recipients, is
just another special privilege Congress has voted for Israel. It enables Israel to invest
the money in U.S. Treasury notes. That means that the U.S., which has to borrow
the money it gives to Israel, pays interest on the money it has granted to Israel in
advance, while at the same time Israel is collecting interest on the money. That
interest to Israel from advance payments adds another $1.650 billion to the total,
making it $84,854,827,200.That’s the number you should write down for total aid to
Israel. And that’s $14,346 each for each man, woman and child in Israel.

It’s worth noting that that figure does not include U.S. government loan guarantees
to Israel, of which Israel has drawn $9.8 billion to date. They greatly reduce the
interest rate the Israeli government pays on commercial loans, and they place
additional burdens on U.S. taxpayers, especially if the Israeli government should
default on any of them. But since neither the savings to Israel nor the costs to U.S.
taxpayers can be accurately quantified, they are excluded from consideration here.

Further, friends of Israel never tire of saying that Israel has never defaulted on
repayment of a U.S. government loan. It would be equally accurate to say Israel has
never been required to repay a U.S. government loan. The truth of the matter is
complex, and designed to be so by those who seek to conceal it from the U.S.
taxpayer.

Most U.S. loans to Israel are forgiven, and many were made with the explicit
understanding that they would be forgiven before Israel was required to repay them.
By disguising as loans what in fact were grants, cooperating members of Congress
exempted Israel from the U.S. oversight that would have accompanied grants. On
other loans, Israel was expected to pay the interest and eventually to begin repaying
the principal. But the so-called Cranston Amendment, which has been attached by
Congress to every foreign aid appropriation since 1983, provides that economic aid to
Israel will never dip below the amount Israel is required to pay on its outstanding
loans. In short, whether U.S. aid is extended as grants or loans to Israel, it never
returns to the Treasury.

Israel enjoys other privileges. While most countries receiving U.S. military aid funds
are expected to use them for U.S. arms, ammunition and training, Israel can spend
part of these funds on weapons made by Israeli manufacturers. Also, when it spends
its U.S. military aid money on U.S. products, Israel frequently requires the U.S.
vendor to buy components or materials from Israeli manufacturers. Thus, though
Israeli politicians say that their own manufacturers and exporters are making them
progressively less dependent upon U.S. aid, in fact those Israeli manufacturers and
exporters are heavily subsidized by U.S. aid.

Although it’s beyond the parameters of this study, it’s worth mentioning that Israel
also receives foreign aid from some other countries. After the United States, the
principal donor of both economic and military aid to Israel is Germany.

By far the largest component of German aid has been in the form of restitution
payments to victims of Nazi atrocities. But there also has been extensive German
military assistance to Israel during and since the Gulf war, and a variety of German
educational and research grants go to Israeli institutions. The total of German
assistance in all of these categories to the Israeli government, Israeli individuals and
Israeli private institutions has been some $31 billion or $5,345 per capita, bringing
the per capita total of U.S. and German assistance combined to almost $20,000 per
Israeli. Since very little public money is spent on the more than 20 percent of Israeli
citizens who are Muslim or Christian, the actual per capita benefits received by
Israel’s Jewish citizens would be considerably higher.
True Cost to U.S. Taxpayers

Generous as it is, what Israelis actually got in U.S. aid is considerably less than what
it has cost U.S. taxpayers to provide it. The principal difference is that so long as the
U.S. runs an annual budget deficit, every dollar of aid the U.S. gives Israel has to be
raised through U.S. government borrowing.

In an article in the Washington Report for December 1991/January 1992, Frank
Collins estimated the costs of this interest, based upon prevailing interest rates for
every year since 1949. I have updated this by applying a very conservative 5 percent
interest rate for subsequent years, and confined the amount upon which the interest
is calculated to grants, not loans or loan guarantees.

On this basis the $84.8 billion in grants, loans and commodities Israel has received
from the U.S. since 1949 cost the U.S. an additional $49,936,880,000 in interest.

There are many other costs of Israel to U.S. taxpayers, such as most or all of the
$45.6 billion in U.S. foreign aid to Egypt since Egypt made peace with Israel in 1979
(compared to $4.2 billion in U.S. aid to Egypt for the preceding 26 years). U.S.
foreign aid to Egypt, which is pegged at two-thirds of U.S. foreign aid to Israel,
averages $2.2 billion per year.

There also have been immense political and military costs to the U.S. for its consistent
support of Israel during Israel’s half-century of disputes with the Palestinians and all
of its Arab neighbors. In addition, there have been the approximately $10 billion in
U.S. loan guarantees and perhaps $20 billion in tax-exempt contributions made to
Israel by American Jews in the nearly half-century since Israel was created.

Even excluding all of these extra costs, America’s $84.8 billion in aid to Israel from
fiscal years 1949 through 1998, and the interest the U.S. paid to borrow this money,
has cost U.S. taxpayers $134.8 billion, not adjusted for inflation. Or, put another way,
the nearly $14,630 every one of 5.8 million Israelis received from the U.S.
government by Oct. 31, 1997 has cost American taxpayers $23,240 per Israeli.

It would be interesting to know how many of those American taxpayers believe they
and their families have received as much from the U.S. Treasury as has everyone
who has chosen to become a citizen of Israel. But it’s a question that will never occur
to the American public because, so long as America’s mainstream media, Congress
and president maintain their pact of silence, few Americans will ever know the true
cost of Israel to U.S. taxpayers.

Richard H. Curtiss enlisted in the U.S. Army in World War II, and served as a military
correspondent in Berlin, Germany after the war. After earning a B.A. in journalism
from the University of Southern California and working on newspapers and for the
United Press, he served as a career Foreign Service officer with the Department of
State and the U.S. Information Agency throughout the world and in Washington D.C.
During his U.S. government career he received the U.S. Information Agency’s
Superior Honor Award and the Edward R. Murrow award for excellence in Public
Diplomacy, U.S.I.A.’s highest professional recognition. Curtiss is currently the
Executive Editor of the Washington Report on Middle East Affairs.