Photo Credit: Liz Kaszynski / Flash 90
F-35 Joint Strike Fighter.

The security agreement between the US and Israel is yet to be signed, and as time goes by it appears that the Americans are in no hurry to complete the deal, Walla reported on Tuesday. Sources at the defense ministry who expected the US aid package to be agreed on by the Passover holiday are seeing the weeks since that target date passing by with little movement from Washington. So far, the Obama Administration has decided to increase the security aid budget to Israel above the current annual $3.2 billion, but in addition they would like to reduce the portion of the budget which may be converted from USD to shekels for IDF purchases from Israeli security manufacturers. That last part would be the most painful, with long-term consequences for Israel’s security.

As part of the US aid package in the past, Israel was allowed to convert a quarter of the money into 3 billion shekel ($786 million) for purchases from Israeli companies. The Israelis object to the American decision to bite into that part of the package, because it would result in a long-term effect on Israel’s defense budget and its military industrial complex.


A former senior defense apparatus official told Walla that “the US plan to cancel the conversion to shekels, even if it’s only a reduction, would have a significant effect on the attractiveness of the entire US security aid package.”

The aid budget offer as it stands today is far lower than Israel’s stated ambition at the start of negotiations with the US. Congressional sources have said that Israel was asking for $4 to $5 billion a year, which over the span of the deal, from 2019 to 2028, could total $50 billion — compared with $30 billion for the 2009 to 2018 package signed with President George W. Bush. The final deal will likely fall between $37.5 billion—the US position, and $40 billion—the amount Israel has come down to. Even at the minimalist, US version, Israel still receives a bump of $750 million over 10 years.

Today the US pays for $3 billion out of Israel’s $15.6 billion defense budget.

The defense source speaking to Walla said an American decision to keep the entire aid package in dollars, to be spent only with US manufacturers, could mean serious out-of-pocket costs for Israel. “For instance,” he explained, “when we purchase the F-35 from the US, it comes with additional derivatives paid for in shekels: we are expected to build an advanced infrastructure for the new squadron, as well as specialized maintenance and special takeoff lanes—for which the US budget converted part would have paid. Cutting it would directly harm the defense budget as well as the military industries.”

Incidentally, as Defense News reported in April, Israel is demanding of Lockheed Martin and the F-35 Joint Program Office to maximize its autonomy over its new stealth fighter force, including its own command, control, communications and computing (C4) system, indigenous weaponry and the ability to perform heavy maintenance in-country rather than at predetermined regional overhaul facilities. No other buyer has asked or received these exceptions for a system that’s considered the most advanced and secret in the US’ possession.

Brig. Gen. Tal Kalman, IAF chief of staff, told an audience in Tel Aviv this year that Israel’s “unique requirements” demand independence in maintaining the stealth fighters. Speaking on Sunday at a conference of Israel Defense and the Fisher Institute for Strategic Air and Space Studies, Kalman said the IAF is going for a “phased and coordinated process” to establish an F-35 logistics center at squadron headquarters at Nevatim Air Base in southern Israel.



  1. Israel continues to pay for the damage done to the Israeli aerospace and defense infrastructure by canceling the Lavi fighter decades ago. Over 1,500 engineers laid off. Another 3,000 technicians and support personnel let go. This is the story that needs to be told and remembered.

    Instead of developing an Israeli alternative today, Israel is stuck accepting whatever the Obama administration is willing to sell them.

  2. Canceling the Lavi was a purely political decision, made to mollify the American manufacturers who feared Israeli competition. Reagan's advisors also feared Israel would become too independent and therefore harder to control. It was a bad move for Israel, but they really had no choice.

    Anyway, the future of air combat is unmanned ships, and the Israelis are in the forefront of such technology. The next war with Hezbollah, Hamas, and the ISIS and Al Nusra groups in Syria will be conducted largely with drones and smart missiles that will tear the enemy to shreds prior to sending in the IDF on the ground.

  3. Blister Peanuts, drones work fine for short range, "persistent kill" roles against uncontested airspace. Against an opponent at longer range, or with a more robust antiaircraft system (as the Russians have deployed in Syria), they will lack the necessary payload and countermeasures to make a difference. An Israeli 5th generation fighter, had Israel's industry not been gutted by the Lavi cancellation back in the 1980s, would have been an invaluable addition to Israel's defense.

    America has benefitted time and again from Israeli military innovations. Helmet mounted sights, LITENING targeting pods, practical ballistic missile defense systems, the list goes on and on. Shutting down U.S. funding for that innovation would be a huge loss for both nations – just like the loss of the Lavi was decades ago.

    Israel needs its own industry to deliver the systems that WORK, and which won't be shared with Israel's Arab neighbors. America needs that too – even if Obama doesn't realize it.

  4. as a US citizen I hope my friends in Israel will wait for the election this year and when Mr. Trump is elected the relations I am sure between the US and Israel will improve They can't get worse under the current US leftist regime of Obama and his policies. I am not a huge Trump supporter but we can’t have the US fall even more behind in our relations with Israel and that will happen if Hillary Clinton or ironically the Socialist Bernie Sanders were elected
    I think it would be wonderful for a strong and intelligent nation such as Israel to work with their allies to develop their own unique fighter aircraft that meets Israel’s needs until then why not let Israel do what Turkey is? The Turks build F-35 center sections and engine components for F-35 aircraft not just their own, why not Israel?
    I think it would be a chance for Israel to build up its advanced composite manufacturing capabilities, and provide thousands of good paying jobs and careers
    just my opinion but I am 1 American that stands with Israel and I know I am not in the minority here in the USA

  5. Rami Chaveri I don't disagree with you; Israel would be best off with its own fighter jet. But let's not underestimate Israel's aerospace industry, which now has drones capable of reaching Tehran.

    They're manufacturing F-16's in Israel under license from Boeing. Actually, Israel today can make probably all the parts of a fighter. I suspect they're continuing to play the game of underdog to keep on the good side of the Pentagon.

    However Obama has pushed them to the point where they should be thinking hard about breaking free of this American leash. They can survive without the $3B/year aid. They might even end up stronger; forced to develop their own weapons. The enemies of Israel will laugh, but in the end Israel will win, just as she has always won.

  6. Such a lack of gratitude. I would be sickened by this attitude toward the US funding Israel's wars against third-world tribals, but… That money is being loaned from China and our leaders in Washington are hell-bent on never paying back those loans.

  7. Israel currently has a 250 Billion Dollar GDP (economy).
    For decades too long, Israel's cowardly, foolish leadership, regardless of Party, has allowed itself to be used by the US. I'll bet that Israel has done more for America in the following list from Operation Desert Storm than NATO has done in its history. Yet, the US spends ten times more on NATO annually and has for many decades:

    Israel Aids Allied War Effort
    Israel was never expected to play a major role in hostilities in the Gulf. American officials knew the Arabs would not allow Israel to help defend them; they also knew U.S. troops would have to intervene because the Gulf states could not protect themselves.

    Israel's posture reflected a deliberate political decision in response to American requests. Nevertheless, it did aid the United States' successful campaign to roll back Iraq's aggression. For example:

    The IDF was the sole military force in the region that could successfully challenge the Iraqi army. That fact, which Saddam Hussein understood, was a deterrent to further Iraqi aggression.
    By warning that it would take military measures if any Iraqi troops entered Jordan, Israel, in effect, guaranteed its neighbor's territorial integrity against Iraqi aggression.
    The United States benefited from the use of Israeli-made Have Nap air-launched missiles on its B­52 bombers. The Navy, meanwhile, used Israeli Pioneer pilotless drones for reconnaissance in the Gulf.
    Israel provided mine plows that were used to clear paths for allied forces through Iraqi minefields.
    Mobile bridges flown directly from Israel to Saudi Arabia were employed by the U.S. Marine Corps.
    Israeli recommendations, based upon system performance observations, led to several software changes that made the Patriot a more capable missile defense system.
    Israel Aircraft Industries developed conformal fuel tanks that enhanced the range of F­15 aircraft. These were used in the Gulf.
    General Dynamics has implemented a variety of Israeli modifications to improve the worldwide F­16 aircraft fleet, including structural enhancements, software changes, increased capability landing gear, radio improvements and avionic modifications.
    An Israeli-produced targeting system was used to increase the Cobra helicopter's night-fighting capabilities.
    Israel manufactured the canister for the highly successful Tomahawk missile.
    Night-vision goggles used by U.S. forces were supplied by Israel.
    A low-altitude warning system produced and developed in Israel was utilized on Blackhawk helicopters.
    Other Israeli equipment provided to U.S. forces included flack vests, gas masks and sandbags.
    Israel offered the United States the use of military and hospital facilities. U.S. ships utilized Haifa port shipyard maintenance and support on their way to the Gulf.
    Israel destroyed Iraq's nuclear reactor in 1981. Consequently, U.S. troops did not face a nuclear-armed Iraq.
    Even in its low-profile mode, Israeli cooperation was extremely valuable: Israel's military intelligence had focused on Iraq much more carefully over the years than had the U.S. intelligence community. Thus, the Israelis were able to provide Washington with detailed tactical intelligence on Iraqi military activities. Defense Secretary Richard Cheney said, for example, that the U.S. utilized Israeli information about western Iraq in its search for Scud missile launchers (UPI, March 8, 1991).
    Before, during and after the war, Israel also contributed intelligence to the United States.
    Rafael designed the Litening Targeting Pods used to fire precision weapons from the Marines' AV-8B Harrier jets, as well as F-15s and F-16s. Limited use was also made of an Israeli helmet system that allows a pilot to more easily target the enemy without maneuvering the aircraft into attack position.
    During a visit to Israel May 30, 1991, Defense Secretary Cheney said: "We think that the cooperation that we were able to engage in during the war in the Gulf…emphasizes how important the [U.S.-Israel] relationship is and how well it works when put to the test."

  8. The military aid package for Israel originally did not have a shekel provision. Over the years, Israel in a desire to employ their own people to make uniforms and stuff have pushed the US to allow a certain amount for our local employment. This has nothing to do with Obama in particular who has increased the aid. The military aid that Israel gets from the US is to enable it to buy the way overpriced US equipment and employ people in the US arms industry. As noted it should be part of the defence budget like NATO but for political reasons related is a foreign aid package, i.e., without Israel in the foreign aid bill, it would never pass.

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