America's Israeli aid budget grows
The cost of maintaining and expanding the close American relationship with the state of Israel is steadily rising. During his current visit in Washington, Israeli Prime Minister Yitzhak Shamir is expected to seek more than the $910 million in economic aid recently approved by Congress for fiscal year 1984. He would also like to reduce the amount of US military assistance approved - $1.7 billion - to about $1.275 billion but have all of it in the form of outright grants, rather than in loans.Skip to next paragraph
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The Reagan administration has agreed to accept this proposal because it wants to revamp military aid to a number of countries that are having difficulties repaying their loans. Apart from foreign-policy and economic considerations, a larger free dole to Israel could also gain political benefits among the American-Jewish community.
Only six years ago, total annual aid to Israel amounted to $1.785 billion. It rose to $2.1 billion in 1981 and to $2.485 billion in 1983. The 1984 package passed by Congress in its continuing budget resolution amounts to $2.6 billion. All of the so-called economic support aid ($910 million) and one-half of the military assistance ($850 million) are straight grants - no repayment needed. The rest of the aid is a soft loan, payable over 30 years with no payment on principal required for 10 years.
Since 1962, the United States has given Israel about $25 billion in aid, half of it a gift.
What is significant about the growing Israel aid budget is that Congress is more generous toward Israel than is the President. Mr. Reagan requested that only $550 million of the military aid for 1984 be in grant form.
The lawmakers raised this sum by $300 million on grounds it would be ''unrealistic'' to give Israel less than the $750 million in military grant aid it received in fiscal 1983.
If Mr. Reagan accepts the Israeli request for more favorable aid terms, he could add as much as another $300 million in nonrepayable military assistance.
Also, the Congress has approved use of American military aid for development of Israel's fighter airplane, the Lavie (lion), despite the fact that it will compete with US planes on the world market. American manufacturers are concerned , because they receive no such equivalent government help.
To what extent domestic political considerations drive the Reagan administration's policy toward Israel is difficult to determine. The traditional wisdom is that presidents do not like to be seen opposing or criticizing Israel in a politically sensitive election year.
''In a year preceding an election, all issues having political implications become more sensitive,'' says one observer. ''Under those circumstances, the President may be more cautious in taking initiatives that could hurt him. But no president would play with basic American interests because of domestic political considerations.''
Some experts say they believe that the current US impulse to get closer to Israel is less the result of pressure from the American Jewish community on the White House than of a genuine frustration on the part of Mr. Reagan's aides - especially Secretary of State George P. Shultz - with the stalemate in the Middle East and a desire to try a different tack. Hence the effort now to make a tactical shift that may force Syria and its Soviet patrons to negotiate.
''The realities of the Middle East are the cause of his (Shultz's) conversion ,'' comments an experienced analyst.