The complex story of the Lavi

ISRAEL had a good thing going in its deal with the United States for the production of the Lavi. The Lavi is a fighter-bomber plane. Originally it was to have been a ``low-cost, minimum capability aircraft that would replace the McDonnell Douglas A-4s.''

That was in 1980 when the program was launched. The plan was revised in 1982, and the designers aimed at the equivalent of the far more sophisticated US-built F-15s or F-16s.

The idea was not just to build planes for the Israeli Air Force. The hope was that the plane would become a major Israeli export item. The Lavis would go on the world market. The US Air Force was targeted as a potential future buyer.

Had the project gone forward successfully, the US aircraft industry stood to lose part of its market at home, and perhaps a larger market overseas. The F-15 is built by McDonnell Douglas. The F-16 is built by General Dynamics. These planes head the list as money earners for those respective US companies.

The marvelous thing for Israel about the Lavi project is that the US was paying for its development, providing much of the technology and some of the parts.

It would be as though the US had paid for the development of the Japanese automobile industry which would eventually take over America's once-profitable automobile export market. (Japan has indeed taken over America's former export market for automobiles, and a big slice of the domestic US market as well. But the Japanese did it on their own. It was not US money or technology creating a successful competitor for an American industry.)

The Lavi progressed from drawing boards to production. Two prototype Lavis had clocked more than 100 hours of flight testing when the decision was taken in the Israel Cabinet on Aug. 30 to call it off.

The cost, to the US, was a major reason - a billion and a half already. Washington was growing unhappy about building an industry in Israel which, if successful, might compete for an important US export market.

McDonnell Douglas builds more than 80 F-15s a year at a cost of about $35 million per copy. General Dynamics builds about 120 of the F-16s a year at a cost of about $20 million per copy. The F-16 is built under license by most NATO countries and has become the standard fighter plane of the alliance.

There is big money in the sale of modern fighter planes.

The US is running a heavy deficit in its trade with the outside world. It cannot afford to lose any important export market. Military and civilian aerospace products are one of the biggest earners of foreign currency for the US.

The cancellation of the Lavi, virtually on US insistence, meant closing down an Israeli assembly line with the loss of some jobs.

Israel immediately asked the US for new projects to take up the prospective slack in the Israeli economy. The US had paid to build the Lavi assembly line and get it running. It is now expected to pay for a substitute source of employment for all those people involved in that production line. The question of how much the US will spend to compensate Israel was under consideration in Washington this week.

It was probably an accident of time that the affair of the Lavi coincided with another matter between Israel and the United States. Washington wishes to replenish the arsenal of Saudi Arabia. The Saudis are an indispensable friend and provider of protective air cover in the current US naval operations in the Gulf. The Saudis have 45 F-15s and would like 12 more to make up for attrition. The Pentagon wants the Saudis to have those planes, plus a list of other supporting weapons.

On Sept. 21, US Secretary of State George Shultz met with leaders of the American Jewish community and urged them to refrain from opposing the sale of new weapons to the Saudis. The appeal was unsuccessful. The board of the American Israel Public Affairs Committee voted to go ahead with a campaign of opposition to the sale and delivery. The campaign has lined up a majority in both Senate and House in opposition.

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