U.S. war-spending bill may give Israel $4 billion in aid

WASHINGTON — Israel is likely to find out how much money it will receive in additional aid from the United States in the opening days of military action against Iraq.

But it is likely to be less than the requested $4 billion in military aid and $8 billion in loan guarantees.

The Bush administration is expected to include its supplemental aid request for Israel in a larger bill that is slated to be sent to Congress in the first days of the war.

The total spending package, estimated to be as much as $100 billion, will mostly be used to cover the costs of the military campaign, as well as providing additional aid to U.S. allies in the region, including Israel, Turkey and Jordan.

Israel's aid request, which comes in addition to the close to $2.7 billion in military and economic aid already allocated, preceded the certainty of war.

Israel, suffering a deep economic crisis, says it needs the additional aid to combat the increased threat of terrorism and to offset the costs of defending against a potential strike from Iraq.

Congressional support for the aid is strong. And by tying it in to the overall spending package for the war against Iraq, some analysts expect it might have an easier time passing Congress than it otherwise would have.

Numerous Israeli officials have traveled to Washington in recent months to work out details of the plan, and all have expressed confidence that the funds will be included in the package.

An Israeli official in Washington said Tuesday that the assumption is that Israel would receive all of the loan guarantees, but would have to settle for less than the full amount in military aid.

The loan guarantees allow Israel to borrow money at a lower interest rate, and there is no cost to the United States if Israel repays its loan. Israel maintains that it has never defaulted on a loan.

Aid to Israel has received a boost from congressional leaders on both sides of the aisle who have sent letters to the White House, urging that aid to Israel be included in the emergency supplemental package.

"Now, with the possibility of conflict with Iraq, Israel is confronted with skyrocketing defense expenditures to ensure that the Israeli people are not once again made innocent victims of attack by Saddam Hussein," said one letter, signed by Senate Majority Leader Bill Frist (R-Tenn.) and Minority Leader Tom Daschle (D-S.D.). "We are concerned that, if not addressed soon, these issues could severely affect Israel's short- and long- term security."

Similar letters have been sent by Speaker of the House Dennis Hastert (R-Ill.) and House minority leader Nancy Pelosi (D-San Francisco).

Some Jewish organizational officials said they hoped that because the aid for Israel is such a small percentage of the Iraq war-spending bill and because the bill will be introduced while troops are on the ground, there will be little resistance from lawmakers.

Still, it might be a tough battle.

Given the U.S. federal deficit, a weak economy and the lack of allies to defray the cost of war, getting additional aid through Congress may be difficult, some said.

Sen. Ron Wyden (D-Ore.) told a meeting of the Orthodox Union here on March 12 that supporting aid to Israel "will be a tough case to make" back home to his constituents.

"We very much need you to be making that case,'' Wyden told the Jewish audience.

Some, including the dovish Jewish organization Americans for Peace Now, have suggested that additional aid to Israel should be linked to movement on the Israeli-Palestinian conflict, including a freeze on settlement development.

Most Jewish groups strongly oppose these ideas, and are concerned that the Bush administration may try to link the aid with progress towards peace.

The settlement issue was a major stumbling point in 1991, when President Bush's father negotiated loan guarantees with Israel. The United States and Israel agreed that aid would not be used for the West Bank and Gaza Strip, and any Israeli funds used for those areas would be subtracted from the amount of aid Israel received.

This time around, both sides agreed on that formula as the start of negotiations.