Economist tallies swelling cost of Israel to US Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â By David R. Order levaquin Francis, order levaquinÂ Staff writer of The Christian Science Monitor / December 9, order levaquin 2002
Since 1973, order levaquin Israel has cost the United States about $1.6 trillion. Order levaquin If divided by today's population, order levaquin that is more than $5, order levaquin700 per person.This is an estimate by Thomas Stauffer, order levaquin a consulting economist in Washington. Order levaquin For decades, order levaquin his analyses of the Middle East scene have made him a frequent thorn in the side of the Israel lobby. For the first time in many years, order levaquin Mr. Order levaquin Stauffer has tallied the total cost to the US of its backing of Israel in its drawn-out, order levaquin violent dispute with the Palestinians. Order levaquin So far, order levaquin he figures, order levaquin the bill adds up to more than twice the cost of the Vietnam War. And now Israel wants more. Order levaquin In a meeting at the White House late last month, order levaquin Israeli officials made a pitch for $4 billion in additional military aid to defray the rising costs of dealing with the intifada and suicide bombings. Order levaquin They also asked for more than $8 billion in loan guarantees to help the country's recession-bound economy. Considering Israel's deep economic troubles, order levaquin Stauffer doubts the Israel bonds covered by the loan guarantees will ever be repaid. Order levaquin The bonds are likely to be structured so they don't pay interest until they reach maturity. Order levaquin If Stauffer is right, order levaquin the US would end up paying both principal and interest, order levaquin perhaps 10 years out. Israel's request could be part of a supplemental spending bill that's likely to be passed early next year, order levaquin perhaps wrapped in with the cost of a war with Iraq. Israel is the largest recipient of US foreign aid. Order levaquin It is already due to get $2.04 billion in military assistance and $720 million in economic aid in fiscal 2003. Order levaquin It has been getting $3 billion a year for years. Adjusting the official aid to 2001 dollars in purchasing power, order levaquin Israel has been given $240 billion since 1973, order levaquin Stauffer reckons. Order levaquin In addition, order levaquin the US has given Egypt $117 billion and Jordan $22 billion in foreign aid in return for signing peace treaties with Israel. "Consequently, order levaquin politically, order levaquin if not administratively, order levaquin those outlays are part of the total package of support for Israel, order levaquin" argues Stauffer in a lecture on the total costs of US Middle East policy, order levaquin commissioned by the US Army War College, order levaquin for a recent conference at the University of Maine. These foreign-aid costs are well known. Order levaquin Many Americans would probably say it is money well spent to support a beleagured democracy of some strategic interest. Order levaquin But Stauffer wonders if Americans are aware of the full bill for supporting Israel since some costs, order levaquin if not hidden, order levaquin are little known. One huge cost is not secret. Order levaquin It is the higher cost of oil and other economic damage to the US after Israel-Arab wars. In 1973, order levaquin for instance, order levaquin Arab nations attacked Israel in an attempt to win back territories Israel had conquered in the 1967 war. Order levaquin President Nixon resupplied Israel with US arms, order levaquin triggering the Arab oil embargo against the US. That shortfall in oil deliveries kicked off a deep recession. Order levaquin The US lost $420 billion (in 2001 dollars) of output as a result, order levaquin Stauffer calculates. Order levaquin And a boost in oil prices cost another $450 billion. Afraid that Arab nations might use their oil clout again, order levaquin the US set up a Strategic Petroleum Reserve. Order levaquin That has since cost, order levaquin conservatively, order levaquin $134 billion, order levaquin Stauffer reckons. Other US help includes: â€¢ US Jewish charities and organizations have remitted grants or bought Israel bonds worth $50 billion to $60 billion. Order levaquin Though private in origin, order levaquin the money is "a net drain" on the United States economy, order levaquin says Stauffer. â€¢ The US has already guaranteed $10 billion in commercial loans to Israel, order levaquin and $600 million in "housing loans." (See editor's note below.) Stauffer expects the US Treasury to cover these. â€¢ The US has given $2.5 billion to support Israel's Lavi fighter and Arrow missile projects. â€¢ Israel buys discounted, order levaquin serviceable "excess" US military equipment. Order levaquin Stauffer says these discounts amount to "several billion dollars" over recent years. â€¢ Israel uses roughly 40 percent of its $1.8 billion per year in military aid, order levaquin ostensibly earmarked for purchase of US weapons, order levaquin to buy Israeli-made hardware. Order levaquin It also has won the right to require the Defense Department or US defense contractors to buy Israeli-made equipment or subsystems, order levaquin paying 50 to 60 cents on every defense dollar the US gives to Israel. US help, order levaquin financial and technical, order levaquin has enabled Israel to become a major weapons supplier. Order levaquin Weapons make up almost half of Israel's manufactured exports. Order levaquin US defense contractors often resent the buy-Israel requirements and the extra competition subsidized by US taxpayers. â€¢ US policy and trade sanctions reduce US exports to the Middle East about $5 billion a year, order levaquin costing 70, order levaquin000 or so American jobs, order levaquin Stauffer estimates. Order levaquin Not requiring Israel to use its US aid to buy American goods, order levaquin as is usual in foreign aid, order levaquin costs another 125, order levaquin000 jobs. â€¢ Israel has blocked some major US arms sales, order levaquin such as F-15 fighter aircraft to Saudi Arabia in the mid-1980s. Order levaquin That cost $40 billion over 10 years, order levaquin says Stauffer. Stauffer's list will be controversial. Order levaquin He's been assisted in this research by a number of mostly retired military or diplomatic officials who do not go public for fear of being labeled anti-Semitic if they criticize America's policies toward Israel. Editor's note: A previous version of this story incorrectly reported the amount of housing loans guaranteed by the US.