Issue Insight

View Original

Why Israel, $522 Billion GDP- World’s 29th Largest; $23.6 Billion Defense Budget- World’s 11th Largest; $200 Billion Foreign Reserves- World’s 18th Largest; Needs $14.3 Billion From U.S. Taxpayers?

Why Does Israel, With A US$522 Billion GDP- 29th Largest In The World; Whose National Budget Is US$123 Billion, Had A US$3 Billion Budget Surplus In 2022, A Defense Budget Of US$23.6 Billion- 11th Largest In The World, And US$200 Billion In Foreign Reserves- 18th Largest In The World, Need US$14.3 Billion Borrowed By United States Taxpayers?

Israel Receives Annually US$3.8 Billion In Military Support From The United States.  And Now Wants US$14.3 Billion MORE For War Against Hamas And Hezbollah… And Iran Too?

Israel Defense Forces (IDF) Leadership Believes It Cannot “Defeat” Hamas Without An Additional US$14.3 Billion?

How Many Civilian Palestinians, Civilian Lebanese, And Civilian Iranians Will IDF Kill With US$14.3 Billion In United States Taxpayer Borrowed Funds?

Will Cost United States Taxpayers US$715 Million In Annual Interest- And Given United States Government Budget Deficits, The US$14.3 Billion Principal Will Likely Never Be Repaid- But Annual Interest Will Continue To Increase. 

Will The Government Of The State Of Israel Offer To Reimburse United States Taxpayers?

  • According to the Congressional Budget Office (CBO), the government of the State of Israel has received since its creation more than US$158 billion borrowed by United States taxpayers.

The Interest Of United States Taxpayers To Have Aircraft, Bullets, Missiles, And Rockets Used To Kill Palestinians In Gaza? 

Israel May Believe That Its US$200 Billion In Foreign Reserves Is To Be Saved For A Rainy Day… There Seems To Be Thunder Storm Over Israel And Gaza.

The goal for Benjamin Netanyahu, Prime Minister of the State of Israel (1996-1999, 2009-2021, 2022- ), is for the armed forces of the United States to directly engage with Hamas, Hezbollah, and Iran.  There are some members of the United States Congress who agree with him.  This goal is similar to that of Volodymyr Zelensky, President of Ukraine (2019- ), which is for the armed forces of the United States to directly engage with the armed forces of the Russian Federation.  There are some members of the United States Congress who agree with him.

  • The State of Israel has an annual Gross Domestic Product (GDP) of approximately US$522 billion- ranking 29th of 193 countries globally by GDP and has approximately US$200 billion in foreign exchange reserves- 18th largest in the world. 

  • Why does the robust economy in the State of Israel need US$3.8 billion annually from United States taxpayers- and now US$14.3 billion more, all of which is borrowed?  

On 31 October 2023, during a hearing before the United States Senate Committee on Appropriations, Joseph Manchin (D- West Virginia) asked a question to Lloyd Austin, United States Secretary of Defense, and Antony Blinken, United States Secretary of State.  Excerpts: 

“MANCHIN: First of all, we know that Ukraine can’t succeed without U.S. support, can Israel succeed without U.S. support?

AUSTIN: That’s correct.  My assessment is that if the United States does not continue to support Ukraine, that they will not succeed.

MANCHIN: Can Israel without our support?

AUSTIN: That’s right.

MANCHIN: Can Israel make it without our support?

AUSTIN: No, I think we have to continue to support them.

MANCHIN: I am just asking you questions that people are asking me.  We’ve given them US$3 billion and is very advanced and Ukraine was not and we had to bring them up to speed to be able to fight their fight.  We’re committed there.

BLINKEN: I would simply say that on the one hand Israel prides itself on being able to defend itself by itself.  But, a critical function of its ability to do that is the support that we provide including the memorandum of understanding that was negotiated by the Obama[-Biden] Administration [2009-2017]…

MANCHIN: Support is not only justified, but needed.  You’re saying it would be hard to take on all the fronts their taking without our support.”

From media reporting (6 November 2023): "Israel's war against Hamas could cost the nation 200 billion shekels, or about 50 billion US dollars, the Israeli financial newspaper Calcalist reported. Citing preliminary numbers from the Israeli Finance Ministry, Calcalist said the figures were calculated based on the war lasting 8 to 12 months; that it remain limited to Gaza; that neither Lebanon's Hezbollah nor Iran or Yemen join the fighting in full; and about 350,000 Israeli Defense Force reservists called up at the start of the conflict return to work shortly, according to Reuters. The staggering sum — which amounts to about 10% of Israel's GDP — was considered an "optimistic" estimate by the Finance Ministry, Catlcalist reported. Amounting to about $255 million per day, about half of the total sum would go to defense spending, while up to $15 billion represents lost revenue that would otherwise be flowing through the Israeli economy during the conflict. An estimated $5 billion would go to businesses affected by the conflict, and another $5 billion could go towards medical treatment of people affected by the war."

Biden-Harris Administration (2021- ) October 2023 Funding Request For The State Of Israel 

Excerpts 

“This request would provide $4.4 billion to the Department of Defense (DOD) for several large activities in response to the situation in Israel, including: replace defense articles from the DOD stocks; reimburse DOD components for defense services and military education and training provided to the government of Israel under section 506(a)(1) of the Foreign Assistance Act of 1961 (22 U.S.C. 2318(a)), as amended; improve ammunition plants and equipment to increase the capacity and accelerate production of equipment to more rapidly replenish defense stocks; and acquire critical defense articles, in lieu of article-specific specific procurement appropriations. The request would also allow DOD to transfer amounts between the different appropriations detailed. 

This request would provide $801 million to the Procurement of Ammunition, Army account in the Department of Defense. Funds would be used to: improve ammunition plants and equipment in order to increase capacity; and accelerate the production of equipment in order to more rapidly replenish defense stocks. 

This request would provide $4 billion to the Procurement, Defense-Wide account in the Department of Defense. Funds would be transferred to the government of Israel for the procurement of the Iron Dome Defense System capabilities and David’s Sling short-range ballistic missile defense in order to counter short-range rockets and mortar threats. 

This request would provide $1.2 billion to the Research, Development, Test and Evaluation, Defense-Wide account in the Department of Defense. Funds would be transferred to the government of Israel for the development of the Iron Beam defense system capabilities in order to counter short-range rockets and mortar threats. 

For an additional amount for “Diplomatic Programs”, $210,000,000, to remain available until September 30, 2025, of which $60,000,000 shall be for responding to the situation in Ukraine and in countries impacted by the situation in Ukraine, of which $50,000,000 shall be for responding to the situation in Israel and areas impacted by the situation in Israel, and of which $100,000,000 shall be available until expended for Worldwide Security Protection to respond to the situation in Israel and areas impacted by the situation in Israel: Provided, That such amount is designated by the Congress as an emergency requirement pursuant to section 251(b)(2)(A) of the Balanced Budget and Emergency Deficit Control Act of 1985, as amended: Provided further, That such amount shall be available only if the President designates such amount as an emergency requirement pursuant to section 251(b)(2)(A). 

This request would provide $210 million to the Diplomatic Programs account within the Department of State. This funding would provide $60 million to sustain critical operational requirements to respond to the situation in Ukraine and in countries impacted by the situation in Ukraine. This request would support the continued protection of U.S. diplomatic facilities and personnel with contracted American guard services in Kyiv and Moscow. The request would also support sustaining Ukraine-related staffing costs and allowances, including guard programs and Embassy Kyiv operating costs, maintaining medevac aviation capabilities, sustaining sanctions, and export control efforts, and for public diplomacy engagement. 

This funding would also provide $100 million to sustain security requirements for Mission Israel and other affected posts through the Worldwide Security Protection allocation, and $50 million for crisis response and relocation support at affected embassies and related task forces and initiatives. 

This request would provide $50 million to the Emergencies in the Diplomatic and Consular Service account within the Department of State. This funding would be used to replenish balances previously obligated towards the crisis in Israel, and sustain the ongoing response to this crisis. The request would allow for the United States to make and act upon contingency and emergency plans that include the relocation and repatriation of U.S. citizens from the region. 

For an additional amount for “Migration and Refugee Assistance”, $3,495,000,000, to remain available until expended, to address humanitarian needs in, and to assist refugees from, Ukraine; to assist refugees in response to the situation in Israel and in areas impacted by the situation in Israel; and for additional support for other vulnerable populations and communities: Provided, That such amount is designated by the Congress as an emergency requirement pursuant to section 251(b)(2)(A) of the Balanced Budget and Emergency Deficit Control Act of 1985, as amended: Provided further, That such amount shall be available only if the President designates such amount as an emergency requirement pursuant to section 251(b)(2)(A). 

This request would provide $3.5 billion to the Migration and Refugee Assistance (MRA) account within the Department of State. Funding would provide lifesaving humanitarian assistance to vulnerable or displaced people inside of Ukraine and taking refuge in the region as well as for increased overseas humanitarian requirements of those affected by Russia’s war in Ukraine and its severe impacts around the world. There are an estimated 16 million people in Ukraine and more than 6.3 million refugees in the region who rely on humanitarian assistance. Russia's war on Ukraine has led to increased costs of basic needs and exacerbated inflation worldwide, due to the suspension of the Black Sea Grain Initiative, which is expected to have severe impacts on global food security and malnutrition. 

Funding would also provide life-saving humanitarian assistance in Israel, and in areas impacted by the situation in Israel. These resources would support displaced and conflictaffected civilians, including Palestinian refugees in Gaza and the West Bank, and to address potential needs of Gazans fleeing to neighboring countries. This would include food and nonfood items, healthcare, emergency shelter support, water and sanitation assistance, and emergency protection. This would also include potential critical humanitarian infrastructure costs needed for the refugee population to provide access to basic, life-sustaining support. This crisis could well result in displacement across border and higher regional humanitarian needs, and funding may be used to meet evolving programming requirements outside of Gaza. 

For an additional amount for “Foreign Military Financing Program”, $7,200,000,000, to remain available until September 30, 2025, of which $1,700,000,000 shall be for responding to the situation in Ukraine and countries impacted by the situation in Ukraine and related expenses, of which $3,500,000,000 shall be for responding to the situation in Israel and related expenses, 

Provided further, That, to the extent that the Government of Israel requests that funds be used for such purposes, grants made available for Israel under this heading shall, as agreed by the United States and Israel, be available for advanced weapons systems, of which up to $3,500,000,000 may be available for the procurement in Israel of defense articles and defense services: Provided further, That any congressional notification requirement applicable to funds made available under this heading for Israel may be waived if a determination is made that extraordinary circumstances exist that impact the national security of the United States: Provided further, That such amount is designated by the Congress as an emergency requirement pursuant to section 251(b)(2)(A) of the Balanced Budget and Emergency Deficit Control Act of 1985, as amended: Provided further, That such amount shall be available only if the President designates such amount as an emergency requirement pursuant to section 251(b)(2)(A). 

Of this amount, $3.5 billion in FMF funding for Israel would support the United States' close partner as it seeks to reestablish territorial security and deterrence. These additional funds would bolster Israel’s ability to protect itself against Hamas, a nonstate actor and U.S. designated Foreign Terrorist Organization. Due to Israel’s urgent need for FMF assistance, the request includes the authority to waive congressional notification requirements that would otherwise apply with respect to such assistance. 

For an additional amount for “International Disaster Assistance”, $5,655,000,000, to remain available until expended, to address humanitarian needs in Ukraine and countries impacted by the situation in Ukraine, and to address humanitarian needs in response to the situation in Israel and the areas impacted by the situation in Israel, including the provision of emergency food and shelter, and for assistance for other vulnerable populations and communities: Provided, That such amount is designated by the Congress as an emergency requirement pursuant to section 251(b)(2)(A) of the Balanced Budget and Emergency Deficit Control Act of 1985, as amended: Provided further, That such amount shall be available only if the President designates such amount as an emergency requirement pursuant to section 251(b)(2)(A). This request would provide $5.7 billion for the Agency for International Development’s International Disaster Assistance account to meet rising humanitarian needs stemming from Russia’s war in Ukraine, the outbreak of conflict in Gaza, and cascading regional and global impacts of those crises. 

Funding would continue life-saving humanitarian assistance, including the provision of emergency food assistance for internally displaced and vulnerable populations and communities inside Ukraine. Humanitarian needs within Ukraine and worldwide remain at extraordinary and unprecedented levels due to the global impacts of Russia’s war in Ukraine, a confluence of complex and protracted conflicts, more frequent and severe natural disasters, and worsening food insecurity. In addition, as donor funding has shifted to respond to Ukraine, tensions in crisisaffected areas in the developing countries are growing, leading to further regional instability. 

This funding would provide multi-sectoral humanitarian support, including safe drinking water, sanitation, and hygiene; critical medical supplies and healthcare; food assistance; and coordination support for the humanitarian community. This funding would also support global needs, which are exacerbated by Russia’s unjustified war in Ukraine and remain at unprecedented levels. This funding would be used to further demonstrate U.S. Government leadership in this time of international crisis when global resources are stretched thin. Funding would also support life-saving humanitarian programming in Israel and areas impacted by the situation in the West Bank and Gaza, and to provide lifesaving assistance, including food assistance, shelter, healthcare, water, sanitation, and hygiene programming. This crisis could result in displacement across borders and higher regional humanitarian needs, and funding may be used to meet evolving programming requirements outside of Gaza, including Israel, West Bank, Lebanon, Jordan, Syria, and Egypt.”

LINK TO COMPLETE ANALYSIS IN PDF FORMAT