Israel's offer to gradually end its dependence on American economic aid is, at first glance, wholly positive. Israeli economic growth has been impressive in recent years. As a matter of national pride, the country doesn't need a $1.2 billion yearly supplement from the United States.
But this offer has complications. The proposal put forward by Israeli Finance Minister Yaakov Neeman would shift $600 million of the foregone economic aid to military assistance. That would boost to $2.4 billion the yearly military help given Israel.
A few points here: Israel is by far the dominant military power in its region. Its neighbors can't begin to match its fire power and effectiveness. Along with the increase in military aid, Israel is asking the US for an OK to spend more of that money as it sees fit within Israel, rather than purchasing US-made arms.
Thus Israel's already impressive military-industrial complex could prosper at US expense. Would the US have any say over the marketing of Israeli arms internationally? Would Washington have any say over what kinds of arms are developed?
Would this ratcheting of US military aid to Israel further deteriorate America's standing as an honest broker for peace in the Middle East?
While the proposed drop-off in economic aid is welcome, it should not be seen by Congress as an opportunity to further reduce a shrinking aid budget. Specifically, it should not signal a corresponding drop in aid to Egypt. The high levels of aid to Israel and Egypt sprang from the Camp David peace accords of two decades ago. But the two countries are utterly different economic entities. For reasons of strategic importance and economic need, Egypt should continue to receive substantial help.
Washington would squander any gain from this bargain if it too readily agrees to boost military aid, or if it neglects to use freed-up aid dollars in other key parts of the world - Central Asia or Africa, for instance.