Stop America’s Military Aid to Israel From Subsidizing the Settlements

The administration’s new security package should require Israel to stop funding settlements, which are destroying the two-state solution. Democratic primary voters might want to weigh in too.

Peter Beinart
Peter Beinart
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Construction in West Bank settlement Modi'in Illit, March 2011.
Construction in West Bank settlement Modi'in Illit, March 2011.Credit: AP
Peter Beinart
Peter Beinart

Should the United States give Israel $4 billion a year without asking it to do anything to keep the two state solution alive?

It’s a timely question. America’s current agreement with Israel, which expires in 2018, grants the Jewish state $3 billion per year in military aid.

(The real figure is hundreds of millions of dollars higher because in recent years Congress has given Israel additional aid for anti-missile defense systems like Iron Dome.) According to press reports, the Obama and Netanyahu governments are weeks away from replacing the current aid deal with a new, substantially larger, one. The United States has reportedly offered $3.7 billion per year. Israel has reportedly requested as much as $5 billion. Whatever the final figure, Israel will continue receiving more than half of America’s overall military aid.

I support military assistance to Israel. Although last year’s Iran deal retards Tehran’s nuclear program, and thus benefits Israeli security overall, it does lift many Western sanctions, thus giving Iran more money with which to bolster its conventional military arsenal. ISIS, Hezbollah and Hamas pose even more direct threats to Israeli lives. I was in Tel Aviv with my six-year-old daughter in the summer of 2014 when Hamas hit the city with rockets. I’m glad the United States helped pay for the missile defense system that knocked them down.

But if Hamas and Hezbollah threaten Israeli security, so does the death of the two state solution. Don’t take my word for it. In 2013, Yuval Diskin, former head of Israel’s internal security service, the Shin Bet, warned that if Benjamin Netanyahu continued his current policies, “we will face an immediate existential threat of the erasing of the identity of Israel as a Jewish and democratic state.” In 2015, former head of the Mossad, Israel’s external security service, Meir Dagan, declared that, “On the Palestinian matter, his [Netanyahu’s] policies are leading to either a binational state or an apartheid state,” and thus “could lead to the end of the Zionist dream.” Just this week, the head of Israeli military intelligence warned that without movement toward a Palestinian state, Palestinian terrorism will grow.

Giving the Israeli government $4 billion per year in security assistance while it continues policies that its own security officials say endangers Israel’s survival is not true friendship, no matter what AIPAC says.

So here’s a modest proposal: Condition the aid package on an end to settlement subsidies.

Right now, Israel doesn’t merely allow its Jewish citizens to move into the West Bank settlements that undermine a viable Palestinian state. It pays them to. A 2012 study by the newspaper Yediot Ahronot found that the average settler receives 70 percent more government money than does the average Israeli inside the green line. (That’s only civilian spending. It doesn’t even count the extra security costs required to guard settlements.) Israel’s five most heavily subsidized municipalities are all settlements in the West Bank, several of them outside the “settlement blocs” that Israel would try to retain in a two state deal.

Other investigations have noted the same thing. A 2015 report by Tel Aviv’s Macro Center for Political Economics found that the Israeli government spends twice as much on students in settler schools as on those in Israel proper. A 2013 Peace Now Report concluded that settlers “receive a budget of four times more than their share of the population” from Israel’s housing ministry. Israeli officials boast about this. In 2012, Netanyahu’s then-finance minister, Yuval Steinitz, bragged that his government had “double[d] the economic and financial support and government transfers to the settlements.”

Asking Israel to end these subsidies in return for a $4 billion annual aid package that would constitute roughly 20 percent of Israel’s defense budget is a pretty modest request. After all, the United States wouldn’t be demanding that Israel sign a two state agreement right away. It wouldn’t even be demanding that Israel stop settlement growth, as George H.W. famously did a quarter-century ago. It would simply be asking Israel not to offer a financial incentive for it.

Merely by posing the question, the Obama administration would make establishment American Jewish groups squirm. They could not support such a condition because they can’t support any pressure on Israel without rupturing their own relationship with Netanyahu’s government. But opposing such a modest requirement would help expose the fraudulence of their supposed support for the two state solution.

It would make Hillary Clinton and Bernie Sanders squirm too. Clinton has signaled that she’ll put even less pressure on Netanyahu than Obama did, and Sanders has tried to avoid talking about Israel together. Yet I suspect most Democratic primary voters think that if the U.S. is going to give Netanyahu $4 billion a year, it should at least ask him to avoid destroying the possibility of a Palestinian state. Merely by posing the question, in other words, the Obama administration would provoke a debate the Democratic Party badly needs to have.

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