• Following the MOU, Netanyahu and Obama met yesterday in New York for probably the final time before Obama leaves office. David Horovitz of the Times of Israel translates the nuance of what was said, and not said, at that meeting.
• Israeli journalist Muazel Mualem reports on controversy in Israel over the MOU, with critics and political opponents charging Netanyahu could have gotten a better deal with the US Administration if he had maintained a better relationship with it.
• Meanwhile, American commentator Jonathan Toben argues that by signing the deal now, rather than waiting for a new US President, Netanyahu was taking a political gamble. However, American writer Nathan Guttman argues the deal is a political winner for both Netanyahu and Obama.
• Reports say Israel intends to use much of US military aid package on new advanced F-35 fighter jets. Meanwhile, analysts say some Gulf States may be pleased with the MOU agreement because, if Israel gets F-35s, that will open the way for them to buy F-15E, F/A-18, and F-16 aircraft which they previously could not under US policies designed to maintain Israel’s qualitative military edge in the region.
• Lee Smith answers critics who say that the US should not be giving “aid” to comparatively wealthy Israel – noting that “military aid” is not at all like foreign aid of the sort they mean, which Israel does not get from the US.
• 88 US senators – out of 100 – sign a letter to US President Obama asking him to continue US policy of vetoing any “one-sided” United Nations resolutions on the Israeli-Palestinian conflict, following concerns in Washington that Obama might decide to vote yes or abstain on a UN Security Council Resolution that would be strongly opposed by Israel during his final months in office.
• More details are emerging about alleged terrorist bomber Ahmad Khan Rahami, who is accused of setting a series of bombs around New York over the last two weeks. Terrorism expert Matthew Levitt says that Rahami is not actually a “lone-wolf” terrorist, as he has been described, and argues the term “lone-wolf” is increasingly being misused.
• Isi Leibler again criticises the interventions of US-based Anti-Defamation League, under its new director Jonathan Greenblatt.
• AIJAC’s statement on the maiden speeches of Pauline Hanson and other Senators from her One Nation party.

Article 1

Obama’s $38B aid package to Israel comes with caveats: It’s generous, but on his terms

By Ron Kampeas

JTA, September 14, 2016 5:53pm

Jacob Nagel, left, Israel’s acting national security adviser, signing a Memorandum of Understanding for $38 billion of U.S. defense assistance over 10 years with Undersecretary of State Tom Shannon, Sept. 14, 2016. (Embassy of Israel)

WASHINGTON (JTA) – President Barack Obama’s near parting gift to Israel, a guarantee of $38 billion in defense assistance over a decade, distills into a single document what he’s been saying throughout eight fraught years: I have your back, but on my terms.

The agreement signed Wednesday in the State Department’s Treaty Room here increases assistance for Israel over the prior Memorandum of Understanding signed in 2007 under the George W. Bush administration and guaranteeing Israel $31 billion over 10 years.

But it also substantially shrinks the role Congress plays in a critical forum shaping U.S.-Israel relations, defense assistance, and in so doing diminishes the influence of the mainstream pro-Israel community, a sector that at times has been an irritant to Obama.

Wrapped into the $38 billion memorandum is $5 billion in missile defense funding, with clauses placing tough restrictions on Israel’s ability to ask for supplements from Congress.

Under Obama and Bush, that’s been an arena where the pro-Israel lobby has flexed its muscle over the last decade or so, consistently asking Congress for multiples of the missile defense appropriations requested by each president – and getting it.

“The MOU as it’s constructed seems to obviate the need for Congress’ traditional role in recent years,” said Jonathan Schanzer, the vice president of the Foundation for Defense of Democracies. “What this means is that the relationship between Congress and Israel will have to evolve. Members of Congress feel they are being pushed out of a role that they relish.”

Democrats in Congress praised the deal unequivocally, but Republicans had caveats.

Rep. Ileana Ros-Lehtinen, R-Fla., the chairwoman of the U.S. House of Representatives subcommittee for the Middle East, led passage of a congressional resolution urging an extension of the defense assistance – coincidentally, just hours after the sides announced a deal was in the offing on Monday. Ros-Lehtinen said she intended to subject the agreement to congressional scrutiny.

“It is important for Congress to conduct its oversight authority and examine the MOU closely in order to ensure that this agreement is mutually beneficial and meets the needs of both the U.S. and Israel,” she said in a statement.

Sen. Lindsey Graham, R-S.C., the chairman of the Senate Appropriations Committee’s subcommittee dispensing foreign aid, was infuriated by the arrangement.

“We can’t have the executive branch dictating what the legislative branch will do for a decade based on an agreement we are not a party to,” he told The Washington Post this week, and pledged to push more funds for Israel through Congress.

Jacob Nagel, the acting Israeli national security adviser who led talks ahead of the agreement, told reporters on Wednesday, before the formal signing, that the Israelis had asked Graham to back off.

“Senator Graham is one of the greatest supporters of Israel in Congress,” he said. “But everyone who spoke with him” on Israel’s team in the talks “said it was not a good idea – Israel is a country that honors its agreements.”

Indeed, written into the agreement is Israel’s pledge to return to the U.S. government any extra monies that Congress approves on top of the memorandum before it kicks in, October 2018. There is an exception for requests for emergency assistance in the event of “major conflicts,” and Nagel noted that the Obama administration has provided such additional assistance quickly.

There are other rollbacks in the deal demanded by Obama and his team, headed by Susan Rice, the national security adviser. Israel is currently the only country allowed to spend some of its defense assistance – up to 26 percent – on its own defense industries. That will be phased to zero by the end of the agreement, and all funding will be spent on U.S. suppliers and contractors.

Obama resented having to deal with intercessors in Congress and in parts of the pro-Israel community over his two terms when he clashed with Israel on critical issues like Israeli-Palestinian peace and the Iran nuclear deal.

Pitching the Iran deal in an August 2015 speech at American University, he referred derisively to critics who called the deal a “historic mistake,” assailing their “credibility.” Republicans in Congress and officials at the pro-Israel lobby AIPAC understood that they were the targets.

Those wounds were not entirely healed, as evidenced by Rice’s comments at the signing. The memorandum, the Iran deal and the 2013-14 Obama administration push for an Israeli-Palestinian peace deal were all part of the same commitment “to Israel’s security over the long term,” Rice said. Left unsaid was how unhappy Israel was with both initiatives.

Just months before Obama leaves office, the memorandum narrows the spectrum of the U.S.-Israel relationship to the two countries’ executive branches, a posture that could benefit Hillary Clinton, whom Obama hopes will succeed him as president. Clinton’s presidential campaign praised the deal.

“The agreement will help solidify and chart a course for the U.S.-Israeli defense relationship in the 21st century as we face a range of common challenges, from Iran’s destabilizing activities to the threats from ISIS and radical jihadism, and efforts to delegitimize Israel on the world stage,” the campaign’s statement said.

A JTA request for comment on the memorandum from the campaign of Donald Trump, the Republican presidential nominee, was not answered.

Ron Dermer, the Israeli ambassador to Washington who helped shape the agreement, said Obama’s imprimatur made it clear that the relationship had the backing of the U.S. political spectrum following two years of tensions between the government of Prime Minister Benjamin Netanyahu and the Obama administration.

“It shows that the strength of the relationship is in being able to weather disagreements,” Dermer said.

Alan Solow, a longtime Obama backer and a past chairman of the Conference of Presidents of Major American Jewish Organizations, said the deal should make it clear that Obama, contra his critics, always valued the relationship and the strategic assets Israel brought to it.

“This shows why making Iran a litmus test was wrong,” Solow said in an interview. “Here you have a prime minister and a president who disagreed quite strongly on the correctness and impact of the Iran deal, and yet they are able to reach a highly significant historical agreement on U.S.aid and Israel’s security.”

The group that was at the forefront of the Iran battle, the American Israel Public Affairs Committee, lauded the agreement.

“We commend President Obama and his administration for forging this landmark agreement,” AIPAC said. “It demonstrates America’s strong and unwavering commitment to Israel.”

Jonathan Greenblatt, the Anti-Defamation League CEO who attended the signing, said the stability of the agreement in a volatile Middle East outweighed whatever political price pro-Israel groups might pay.

“We have surging Islamic radicalism, we have an expansionist and hostile Iran,” he said. “We have a degree of dislocation and suffering we haven’t seen since the Second World War. Rather than try to game this, who’s up who’s down, who’s in, who’s out, what’s important is that this locks down a commitment that will persist not just with this administration, but the next one and the administration after that.”

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Article 2

BICOM Briefing:New ten-year US-Israel Memorandum of Understanding

BICOM, September 2016
 

Background:

• The United States and Israel have maintained a strong relationship for decades, based on a host of factors including a mutual commitment to democratic values and shared strategic goals for the region. US bilateral military aid to Israel is seen by both countries as an integral component of the relationship and of the US commitment to Israel’s security and is considered by many in Israel as vital to the country’s security.

• The MOU between the United States and Israel, of which US military assistance is a key component, is required to be renewed every ten years. With the signing of their first ten- year MOU on security cooperation between Israel and the US in 1998, whereby the US committed to providing Israel with US$23bn in security assistance, several arrangements unique to Israel were introduced, including the practice whereby US assistance is typically dispersed to Israel within the first 30 days of the fiscal year. In addition, Israel is the only country that is permitted to utilise the cash flow to finance US arms purchases, and to negotiate arms deals directly with US defence suppliers, leveraging the financing coming from future aid payments.

•  In addition to the ten-year bilateral military assistance agreements, supplementary funding has been available to Israel, in particular, related to congressional appropriations for bilateral missile defence programmes, as well as emergency assistance.

Israeli Chief of Staff Benny Gantz and his American counterpart Gen. Martin Dempsey in 2014: The agreement signals that the US-Israel security relationship remains “bulletproof”

Ten years on: what has changed?

Israel’s changing security environment: When the negotiations picked up in earnest in late 2015, the Israeli media reported that Israel entered the negotiations for the new MOU requesting US$50bn over ten years. The demand for increasing assistance was based on several factors, most notably, the belief that in the wake of the Iranian nuclear agreement, Israel needs to prepare militarily for the future, when key provisions on centrifuges and enrichment expire, as well as for the possibility that the deal falls apart beforehand.

Moreover, Israel remains concerned that as international sanctions on Iran are lifted (initial reports suggested that the lifting of sanctions would give Iran access to US$50bn in frozen assets), the influx of cash to Iran may find its way to the hands of Iran’s proxies, including Hezbollah and the Palestinian Islamic Jihad – a concern which has been acknowledged by the Obama administration. Other factors that compelled Israel to request an increase in military assistance include the increase in US military sales to Sunni Arab countries – to assuage their concerns with respect to the Iranian nuclear agreement – as well as the ongoing conflict in Syria and the growing presence of violent non-state actors on Israel’s northern and southern borders.

The state of the US economy: When the Bush administration negotiated the last military aid package between the US and Israel in 2007, the US government agreed to raise the annual Foreign Military Financing (FMF) grant to US$3.1bn, through to fiscal year 2018. The current negotiations, however, have occurred in the wake of a global economic downturn, and amid calls from many in the US demanding that the government curb foreign spending, and implement deficit reduction. Yet despite the economic downturn in the US and the global economy, the new MOU of US$3.8bn per year will be the largest aid package ever allocated by the US, and Israel will remain the top recipient of US foreign aid and security assistance.

Disagreements during the negotiations

• Immediately after the signing of the Iranian nuclear agreement, US president Obama offered additional military assistance to Israel, and expressed a willingness to swiftly conclude negotiations for the new MOU that would take into account Israel’s concerns related to the deal. At the time, reports suggested that the administration was prepared to increase the annual FMF grant, with some reports indicating the president was willing to sign off on an aid package that would amount to somewhere between US$4bn and US$5bn in annual assistance. However, disappointed by the terms of the Iran deal, Prime Minister Netanyahu rejected the administration’s offer, a move that has been subsequently criticised by former Israeli security officials. Netanyahu further angered the Obama administration in February 2016 when he suggested that his government might opt to withhold signing the aid package until after Obama left office, indicating that the terms Israel would receive might be better under the next administration.

• On April 25, a bipartisan group comprised of 83 US Senators signed a public letter in support of signing a “robust new MOU” that “increases aid while retaining the current terms of our existing aid programme”. The White House publicly rejected the letter, and this prompted Netanyahu to reach out to the Obama administration, through a private backchannel, to distance the Prime Minister’s office from the Senate letter. While the negotiations were reportedly concluded in August, news broke on September 12 that the announcement was being held up by US Senator Lindsey Graham (R.-S.C.). The White House was troubled by the fact that Graham, in his role as chairman of the Senate subcommittee overseeing the foreign affairs budget appeared to be working to undermine the administration’s negotiations with their Israeli counterparts, by marking up an appropriations bill that would provide funds to Israel exceeding what the administration was offering. It remains unclear whether the administration’s disagreement with Graham had been resolved when the deal was announced on September 13.

• Developments in US domestic politics may have led the Prime Minister to decide to complete the negotiations and sign a deal during Obama’s tenure. Thus far in the election cycle, the Republican Party’s nominee for president, Donald Trump, has sent mixed messages with respect to what a Trump administration’s policy would be with respect to Israel. While he has publicly affirmed the importance of the US-Israel relationship he has also demonstrated isolationist tendencies and suggested that US allies would have to pay their share in exchange for American support. Meanwhile, the Democratic presidential candidate Hillary Clinton is unlikely to offer more than her predecessor. For Netanyahu, signing the deal before the end of Obama’s tenure in office may also be an attempt to silence his domestic critics, who have repeatedly claimed that he has mismanaged the US-Israel relationship.

What does it mean? Key components of the deal

Maintaining Israel’s Qualitative Military Edge (QME): Since the 1970s, the US has pledged to assist Israel with maintaining its QME over neighbouring countries and this commitment on the part of the US remains unchanged, evidenced by the administration’s willingness to sign a new MOU with Israel at an increase of around US US$10bn over the decade, as well as by the fact that the Obama administration has, over the years, provided more aid funding and security assistance than his predecessors. Apart from executive actions, Congress too has taken steps to reaffirm the US commitment to Israel’s security. Aside from fulfilling annual requests for supplemental funding and providing emergency assistance to Israel during 2014’s Operation Protective Edge, in 2012, Congress passed the United States- Israel Enhanced Security Cooperation Act, which reaffirmed the commitment of the US to maintaining Israel’s QME.

Advancing joint programmes: For the first time, the new FMF grant incorporates funding for missile defence, allocating nearly US$500m to be spent in Israel on cooperative missile defence programmes such as Iron Dome, the new anti- tunnel initiative, and a host of other pre-agreed joint Israeli-American programmes. Previously, funding for missile defence was allocated on an ad hoc basis by Congress.

Foregoing supplemental funding via Congress: Two key provisions promoted by the Obama administration contributed to prolonging the negotiation process. The first is the requirement that Israel forego – barring an extreme emergency – lobbying Congress to request supplemental funding. According to one estimate, supplemental funding provided to Israel since the start of the last MOU in fiscal year 2009 exceeds US$1.9bn in Pentagon budget requests. This includes the allocation of US$40m for a joint US-Israel tunnel detection programme, as well as US$487m for joint missile defence programmes. The latter earmark was part of an omnibus spending bill passed by the US Congress in December 2015.

Phasing out the Off-shore Procurement Policy (OSP): The second source of disagreement relates to the phasing out of the OSP. The policy, established in the late 1980s and unique to Israel, allowed the Israeli government to allocate 26.3 per cent of its annual FMF grant to be spent on procurement from Israeli (rather than American) defence companies. In effect the OSP acted as a subsidy to Israel’s now robust defence industry, placing it on par with that of the US. Per the terms of the new MOU, the parties have agreed to a gradual phasing out of the OSP, over a six-year period, beginning in 2020.

The US Administration maintains that while the OSP was initially established under the Reagan Administration to subsidise the Lavi project – a US funded Israeli air force programme that was terminated 30 years ago – it was never intended to be an open-ended entitlement programme. At present, the policy’s terms, combined with allowances for Israel’s spending on fuel for its air force, allow for nearly 38.7 per cent of the military aid (US$1.2bn annually) to be spent in Israel rather than on US material. During the negotiations for the new MOU, Netanyahu agreed to end the provision regarding using US FMF funds for military fuel purchases.

The gradual phasing out of the OSP would bring US assistance to Israel in line with similar arrangements with other countries, wherein the money would now have to be spent in the US. However, in the wake of reports that the new FMF will result in a loss of funding for local research, development and procurement, the Israeli defence industry is bracing for massive layoffs while concern exists that phasing out the OSP may ultimately impair Israel’s ability to maintain its QME.

The continuing importance of Israel-US Relations

• While the newly signed agreement is scheduled to come into effect in fiscal year 2018, concluding the agreement before the end of the Obama administration reaffirms the importance of the US-Israel relationship for both countries. First, it will prevent the issue of US military assistance to Israel from  becoming a political football – one that either government can exercise to mobilise domestic supporters during election period. Second, while recent polling data suggests that support for Israel among certain segments of the American population is slipping, the signing of a ten-year military assistance agreement by a liberal US president would indicate that US- Israeli security cooperation remains, as one analyst recently noted, “bulletproof”.

• Signing the agreement before the end of the Obama administration also sends a strong message to detractors that while the two leaders may not have a strong personal relationship, the US government continues to view its relationship with Israel as a strategic priority.

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Article 3

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