Less then three months ago the Israeli government fell apart over a dispute between Likud and Labor over how the budget pie should be divided on both sides of the Green Line. Labor is now asking the voter to choose between expanding Kiryat Arba or improving standards of living in Kiryat Shmona. Shimon Peres said last week during a campaign speech in Ramat Gan that Israel spent no less than $60 billion on the settlements, which he called "fanning the flames of the conflict" - the equivalent of 20 years American aid. Amram Miztna is trying to persuade the voters that the key to their physical and economic security is to be found in disengagement from the territories and the return of most of the settlers to the state of Israel.

And now, less than three weeks before the decision is made on Election Day, the U.S. is telling the Israeli voter that the Likud can preserve security, deepen the occupation and get funding from Uncle Sam.

Before the first word has been spoken in the discussions scheduled for today in Washington about the special aid and loan guarantees, the Israeli public is getting the message that the leader of the free world is pleased with the policies of the Sharon-Eitam government: presumably, if Bush wasn't interested in perpetuating the right-wing government, he wouldn't have invited the prime minister's bureau chief, Dov Weisglass, at the height of an Israeli election campaign, to discuss the aid. Last month Bush rebuffed Quartet pressure to place the road map on Sharon's desk. At the time, he was convinced that sensitive political issues should wait until after the elections.

When Bush Sr. wasn't happy about the Sharon government's settlement policies - also during an election campaign - he rejected a request for loan guarantees meant to absorb the wave of immigration. A short while later, in the wake of Yitzhak Rabin's victory in 1992, the American president gave Israel loan guarantees for $10 billion. It was agreed at the time to deduct every shekel spent in the settlements from that sum.

Seemingly, could anything be more natural than copying that arrangement between Rabin and Bush Sr. to an agreement between Sharon and Bush? There are a number of answers to the question. First, the doubling of the number of settlers, from 100,000 to 200,000, shows that deducting shekels from the guarantees is no guarantee of cutbacks in the settlements. Secondly, government officials who knew what was going on, know that there are creative ways to obstruct the monitoring of how the American money is used. Those same Israelis who are freezing the Palestinian taxpayers' monies on the grounds the Palestinian Authority is making poor use of them (in terrorism) are making poor use (in the settlements) of American taxpayers' money.

Third, unlike the current prime minister, Rabin stopped encouraging Israelis to settle in the heart of densely populated Palestinian areas. Unlike the current defense minister, who has spent the last two months "learning the illegal outpost issue," defense minister Rabin ordered the IDF to halt the land grabbers. Moreover, the aid money, ostensibly to be used for security expenses in the territories, will also be used to protect those same outposts that were established with the blessings - whether before or after the act - by the Netanyahu, Barak and Sharon governments.

The most dangerous innovation in the American attitude to the settlements shouldn't be sought in their relationship to the guarantees or the problematic timing of the negotiations over the aid. There's a much more profound change in policy here: in the latest discussions of the road map, President Bush rejected the Quartet's position that terror should be fought as if there were no new settlements and the settlements should be frozen as if there were no terror. He set a new precedent, that settlements are not an absolute danger to peace, but rather a matter contingent on outside factors, including domestic American politics. The American decision that a settlement freeze is conditional on Sharon's satisfaction with a cease-fire is, in effect, a legitimization of the deepening of the occupation, perpetuating the war and perhaps a guarantee for continued right-wing rule.