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March 24, 2015 9:04 pm

The Next Crisis? United States Might Limit Aid to Israel by Amount it Spends on Settlements

avatar by David Daoud

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The Psagot settlement in Israel. Photo: Wikipedia.

The State Department might be attempting to limit the loan guarantees Israel receives from the United States, based on Israel’s expenditures on West Bank settlements, according to an Israeli media report published on Tuesday.

Israel’s Walla news said that the State Department will be submitting a brief to Congress detailing Israel’s investment in settlements over recent years – purportedly in the billions of dollars.

Officials familiar with the report currently being formulated told Walla that after this move in Congress, Israel might remain with a “very limited” amount of financial guarantees. The effect of offsetting the guarantees would only be felt by Israel when it actually seeks to use them, for example when there is an economic or security crisis. The last time Israel sought to use its loan guarantees from the US was a decade ago, in 2005.

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US government officials have been debating how to treat the sensitive report. According to Walla, Secretary Kerry and others recommended a delay in its publication so as to not be perceived as attempting to influence the elections in Israel last week. “People were afraid that if the report was leaked before the elections, it would look like an attempt to influence them, though in reality there is no connection between this report and the other crises between Obama and Netanyahu,” claimed an American official who was involved in the process. The official added that “this is a technical matter that was derived from an agreement that was reached during President Bush’s term in office. This has nothing to do with Netanyahu and Obama, but is related to Israel’s general policy to invest in settlements.”

The method of offsetting aid by Israel’s expenditures on settlements is nothing new. In 2003, in the wake of Prime Minister Sharon’s investment in settlements, the Bush Administration announced that it would offset Israel’s loan guarantees by about $300 million. At the time, Israel was in critical need of the guarantees in light of the recession caused by the Second Intifada. And in 2005, the United States and Israel agreed that Israel’s financial guarantees would be reduced by the amount it spent on settlement building.

A US official noted that after the offsetting of funds that the Bush Administration carried out, Israel was left with $3.8 Billion in available funds, saying that, “it is not clear how much of this amount will be deducted now following the State Department’s report. But, as soon as the report is delivered to Congress, it will cause turmoil.”

News of this report comes at a particularly tough time in US-Israel relations, particularly over the United States’ perception of Israel’s lack of a continued commitment to a two-state solution.

Leading commentator on security affairs, David Ignatius, made reference to the State Department report in a recent column and commented that it might be intended by the Administration as a warning to Israel, and to deter Netanyahu from settlement expansion.

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  • Pete

    My goodness, I am an American trying to understand all this and was reading your paper here. I had no idea the level of hatred towards America in Israel. I’m really surprised.

  • Ivan Gur-Arie

    Lord, may the time run by quickly when the term Obama was elected to ends. May his memoory fade from the pages of history as quickly, except to serve as a lesson that a child should not be elected to lead this great country.

  • Olde Boomer

    Thinking of investing in hard hats. If we keep leaning on Israel, as sure as the Scripture says bad things are gonna be coming. Get ready to duck. Speaking of Israel, “I will bless those who bless you. I will curse those who curse you.” Read psalm 2. It says exactly what will happen to those who divide the land.

  • John

    Why is Israel getting aid at all? The USA is falling apart. The money spent interfering in the affairs of other nations should be spent re-building America’s infrastructure and resuscitating the middle class.

  • Sam Talmund

    In other words, Israel, Obama will use his power, not to act as a mature statesman and bring America’s allies together, rather he will use his power to weaken one of America’s strongest allies so it can be defeated, and defeated by America’s enemies. And he will weaken other allies so they can be defeated in their homeland. All this because Netanyahu dared to question him? This is an abuse of Presidential power. He doesn’t have the right to act on behalf of the American people for his own narcissistic pleasure.

  • BuckDePublick

    State Dept,:

    With HITLER in 1938
    With HAMAS in 2015….

    • Pete

      Wow! As an American I just could not be more insulted. I am a white middle age republican who voted for Romney and Bush, and while America is far from perfect in many ways including how we treat Israel, I always had the impression we rather helped out in World War 2, and have helped Israel ever since. By the tone and nature of these comments I can see that feeling is not shared by Israel. Well guess what, we’re gonna stand by your side anyway. Shalom I say to all of you, and I mean that most sincerely.

  • Ben Lopez

    If us limits aid to isteail then limit aid to all countries,don’t discriminate fools!

  • Obama is the disease that corrupts the entire humanity. He has turned his wrath on Israel and that is a dreadful mistake. God is not random what he says he will do as this Obama administration is about to find out

  • 10

    OTHER RELIGIONS HAVE SO MANY BIBLES ON LONG SHELVES AND PEOPLE ARE BUYING THEM AND DO NOT HAVE THE JEWISH BIBLES THEIR. TO STOCK THE JEWSIH BIBLE IN BARNES AND NOBLE ETC.

  • RIVKA BRANDEIS

    THANKS FOR THE UPDATE…..IT SEEMS THE WHITE HOUSE IS OUT OF MONEY….SEEMS THE STAFF IS LEAVING LIKE NOAH’S ARK…BUT THIS IS PASSOVER TIME…..AND I ENJOY THE UPDATES THAT PROVE AMERICA IS NOT A STABLE OR HONORARY FRIEND TO JEWS…..NOT JUST TO ISRAEL ….. BUT TO JEWS ALL OVER….EXCEPT…J STREET, WHICH IS A SLAP IN THE FACE TO MOST JEWS….OBAMA HAS CHOSEN THE SNAKE TO BITE OUR BUTTS……AT LEAST HE IS TRYING….AND HASHEM HAS CHOSEN TO HARDEN THE HEARTS OF THESE NUTTY CASES OF WHAT I THINK OF AS VOMIT.
    YOUR THE BEST ISRAEL…..KEEP YOUR SETTLEMENTS GOING AND REMEMBER WE JEWS ALL OVER THE WORLD CAN SUPPORT ISRAEL AND MORE.
    ‘ DO WE NEED THEIR MONEY’…….’NO’……MONEY THAT COMES WITH STRINGS SO SLIM CAN ONLY REALIZE THE BASKET OF TRUTH AND THE BASKET OF SAFETY IS ONLY WITHIN OUR HANDS FROM HASHEM…….AND NOT WITH THE EVIL AMERICANS OF TODAY…..IF IT ISN’T ALL AMERICANS…….IT IS STILL THE SATAN’S CHOICE AS LEADER.
    PLEASE RELEASE JONATHAN POLARD

  • Let me see if I have this right.
    In 2005 the USA wanted Israel to give Gaza to Hamas for (cough) peace.
    All those Jews then needed homes. The USA doesnt want Israel to build homes for them. Settlements are – TADA! – HOMES for JEWS! Where did the USA want those Gaza Jews to go? Jews gave up their Gaza homes and greenhouses – for (cough choke) peace. The Palestinians want Jews in the sea. Now 0bama doesnt want Jews to build on the land left, their own land, the HEARTland of Israel, the City of GOD?

    If we believe Genesis 12.3 – and I do! – 0bama is cursing America with his hatred of Jews, Bibi, Israel.

    In 2005 the day the last Jew was ousted from Gaza, PM Ariel Sharon died and Hurricane Katrina formed in the Atlantic.

    Book – EYE to EYE by Bill Koenig

    All the nations of the earth shall be harmed who gather against Jerusalem.
    My simplification of Zechariah 12:3
    http://biblehub.com/zechariah/12-3.htm
    http://biblehub.com/drb/zechariah/12.htm

  • Barrack Hussein Obama face it – Israel is Jewish territory and it is not negotiable.

    The Arabs already have 46,000 sq. miles of Jewish land (5 times the size of Israel) that they confiscated from the million Jews they expelled from Arab countries in the past 90 years. They also have the Jewish territory of Jordan.

    I think you do not have your facts straight – Israel belongs to the Jews.
    The Quran states it clearly.
    Israel is a Jewish State its territories are non-negotiable. It has been a Jewish country for over 4,000 years.
    The Arab-Palestinians are the occupiers. All they want is to destroy the Jews. They educated their children and the masses to commit terror and violence against Israel. The dance in the streets when the twin towers in 9-11 collapsed and 3,000 Americans died.
    It is amazing how you and many others choose to ignore that the Arab countries have expelled over a million Jews from their countries in the last 90 years. Jews who lived there for over 2,000 years. The Arabs confiscated their assets, businesses, homes and real estate 5-6 times the size of Israel – 120,000 sq. km. or 46,000 sq. miles which is valued in the trillions of dollars.
    Any Arab who is not happy to live under the Israeli government can move there.
    Study your history; Muhammed in 627 about 1,500 years ago beheaded 700 Jews in Medina which was a Jewish town in Saudi Arabia, he killed all the men took the women as slaves and raped their daughters. This is just the tip of history.
    Do you want more study the complete unbiased history objectively.
    YJ Draiman

    P.S.
    There was never an Arab-Palestinian State in Greater Israel and there will never be – face it.
    The Ottoman land records of Palestine confirm that the Arabs did not own land, the were sharecroppers. Over 90% of the land was owned by the government the balance was owned by absentee wealthy Arabs from Lebanon who sold it to the Jews at premium prices.

    It is time to implement population transfer for all the Arabs.
    who create violence, riot and attack Jews and anyone else. They could be relocated to the home and land of the million Jewish people, expelled from Arab countries or Jordan.
    YJ Draiman.

  • It is better to join with Russia it seems. They are successful in Ukraine, Denmark etc. The orthodox church in Egypt,Russia and even Alaska will support us.

  • JIm

    There have been enough instances of the American’s displeasure over Israeli settlement expansion, from both Republicans and Democrats. It’s about time Israeli government members realised this and stopped pushing their luck. It’s as if they are trying to demolish their own country.

    • zadimel

      That’s it. It is their country. The Arabs have tried for the past 67 years to annihilate the Jewish State, and have killed more of their own than Jews. Keep it up, and the Middle East will be better off without the crazy ones, and Israel will be safer.

  • Virginia Apple

    Obama…trying to be dictator of the world! Part of his temper tantrum, I guess. He can’t kick a door so he is kicking Israel.

  • dante

    oh, the administration feels so strongly about Jewish “settlements” in the site of Jewish habitation for 4000 years! “settlements” in places like Jerusalem, Hebron, Beth El, and elsewhere in Judea and Samaria.

    that strong concern comes from a solicitude for the “rights” of people who have lived in the Land of Israel since the beginning of the 20th century or the 18th or 19th centuries…in no case, earlier than the Muslim military conquest (yeah, their “rights” are the rights conferred by conquest!).

    so, the dummies of the administration, including White House chief of staff, mcdonough, and the academy and some moron actors and singers are very concerned about the rights of “indigenous” populations? LET THEM DEMONSTRATE THE AUTHENTICITY OF THAT CONCERN BY LEAVING MARYLAND (mcdonough) AND NEW YORK (khalidi) AND MASSACHUSETTS (walt) AND ILLINOIS (mearsheimer) AND PENNSYLVANIA AND NEW JERSEY AND TEXAS (baker) AND GEORGIA (carter) AND EVERY OTHER STATE IN THE UNION!!! OR, IS IT ONLY A RULE FOR THE JEWS? don’t tell me that mcdonough has a greater right to live in Maryland than the Jews to live in Shiloh or Itamar or the Old City of Jerusalem (where the Jews have been a majority for more than 150 years)!!! this hostile obsession with the Jews and the determination to deprive them of rights they allow themselves are the products of ignorance and stupidity and sanctimony and hate.

  • Israel has never defaulted on any U.S. loan guarantees, and deserves better treatment. Any sovereign nation has the right to build modern apartments to accommodate their citizens. And the current usage of “Settlement” is intellectually dishonest and belongs in the 1800’s.

  • Yale

    Maybe the issue should be whether the Palestinians are committed to a two-state solution, other than one state for the PLO and one for Hamas.

  • art

    It is OK for the pa to use US money to reward murderers but Jews can not build homes or even maintain their homes. So much for US guarantees and the “negotiated” peace of Oslo, thanks peres, bailin sarrid et al

  • It is a dirtiest American campaign against Israel leading by democratic president Barack Obama It is his retaliation for a total failure of American policy in the Arab world and in the entire Middle East. Israel became a scapegoat for Mr.Obama. If the offsetting goes farther The most terrible would happen: Israel shall ask for help from Russia. It will give Russia the full control over Israel and greatly harms America. I don’t hope anymore to Jewish organizations and Jewish millionaires in the USA who stand knee-bent before Mr. Obama and betray their (our) people.

  • DACON9

    now usa should limit aid to abbas by the amount of money he diverts to military purchases and what he uses to build tunnels.

    and so on and so forth….

    MASHIACH MASHIACH MASHIAAAACH

  • yussi

    shame on them if they dare even propose this! They give aid to terrorists though..shameful and self defeating.

  • defiantjewess

    more threats from angry Obama

  • When is the US electorate going to do something about Obama? Has the world really got to suffer this man till the end of his term? Obama can’t nuke Israel although he wants to give the power to Iran to do so? As Israel has managed for the last ten years without these funds I would believe Israel can manager another ten years. According to Warren Buffet the US is shortly going bust due to the high level of debt owed to China who are now also in economic decline. Just shift Obama from the White House and shift terrorists out of Israel’s Gaza strip, Sumaria and Judeah.

  • Bill

    I guess President Obama is you friend until you disagree with him.

  • E Pluribus Wombat

    Israel needs to bail out of the F-35 program today.

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