This year the Israeli government will spend $5.5 billion on defense. One out of three of the dollars will come from the U.S. Treasury.
Before the invasion of Lebanon, there were 567 combat planes in the Israeli air force. Of those, 457 were U.S. aircraft paid for with American grants and loans. Another 80 planes--Israeli-made Kfirs--use an engine made by General Electric Co.
Without spare parts Israel's military machine would grind to a halt. It gets $500 million worth of those parts annually from 15,000 U.S. companies.
These statistics detail a client relationship that is receiving new attention as a result of allegations that Israel has used American weapons against Palestinian civilians in Lebanon, possibly in contravention of past arms sales agreements.
Inevitably, this has raised the question of whether the vast U.S. aid to Israel has given the superpower influence over its small Middle East client, or whether it is the other way around.
Defense Secretary Caspar W. Weinberger has said the United States has "no control" over Israel or its forces.
But Israeli officials in Washington themselves acknowledge their unusual vulnerability to any lessening of military, economic and financial support from abroad. These officials contend, in fact, that Israel's need for both military and economic aid has increased considerably since the Yom Kippur War in 1973, because an Arab arms buildup has coincided with growing Israeli foreign debt.
Israel's budget of $20 billion, which is swelled by $5.5 billion of defense expenditures, is currently equal to the nation's entire gross national product. That is only possible because of American aid (which includes $785 million in economic assistance in addition to $1.8 billion in military grants and loans), the sale of Israeli bonds and loans from foreign banks.
If all the U.S. aid was divided among the 4 million Israelis, each would get about $600 a year. In addition, Israel receives about $1.5 billion a year in payments and gifts from Jewish organizations, individuals and the West German government (which provides some $400 million annually to Israeli citizens victimized by the holocaust).
In a report on the Israeli economy issued in March, the Agency for International Development noted that U.S. military and economic assistance "enables Israel to pay for weaponry, fuel and other civilian imports ... without heavy reliance on high cost commercial borrowing, depletion of its foreign exchange reserves, or economic depression."
With the exception of some French aircraft and British tanks, almost all the equipment in the Israeli armed forces has been obtained under the U.S. government's foreign military sales program, from which Israel has received $15 billion of the $28 billion distributed worldwide since 1951.
Israeli is one of only five countries, in addition to Turkey, Egypt, Liberia and Zaire, that have been permitted to spend U.S. military aid money in countries other than the United States. And it is one of only two countries, along with Egypt, that is allowed to order U.S. equipment through the military aid program before Congress has authorized the money.
The American government also gives Israel unprecedented privileges, from a right to bid for American defense contracts to the right to own the most modern U.S. weaponry and military electronics.
Tediran, a joint U.S.-Israeli company based in Israel, recently beat out E Systems, a Dallas company, for a $40 million contract to supply sophisticated radio equipment for U.S. Army tanks and ground vehicles.
The U.S. government has also given American firms permission to supply Israeli defense industries with the critical technology and equipment they need to build up their own advanced defense production. For example, Pratt and Whitney is now helping Israel develop an engine for an advanced supersonic-speed fighter aircraft, the Levi, to be ready in this decade.
"It isn't that we have no control over Israel," a former Pentagon official said last week. "It's that we have chosen not to exercise that control."
Except for the delay announced by the White House Monday in a shipment of cluster munitions shells while their use by Israeli forces in Lebanon is reviewed, Pentagon and Israeli officials have reported no interruption in the flow of U.S. spare parts, or "follow-on support," since the invasion of Lebanon.
"We are conducting business as usual, following national policy," said a Pentagon official. A formal U.S. letter offering to provide an additional 11 F15 fighter bombers is being "processed routinely," he said. A total of $1.5 billion worth of aircraft, self-propelled howitzers and armored personnel carriers is still in the pipeline.
Officials said privately that U.S. unwillingness to use the full weight of its influence to clamp down on Israel is traceable to politics, strategy and the web of interlocking industrial, economic and military interests that bind the two countries.
American military aid has jumped sharply in the last few years, after being frozen at $1 billion a year between 1977 and 1980. The new equipment has helped Israel increase its military dominance in the region.
But Israeli officials blame America's overall Middle East policy, especially military sales to Arab nations, for fueling an arms race and making it unfair to reduce arms shipments to Israel.
In March of this year, for example, the Pentagon announced plans to sell Israel 200 improved Hawk missiles--a move officials admitted would make it easier to sell F16s and missiles to Jordan. Last year, soon after the Reagan administration took office, officials announced they would increase military aid to Israel by $600 million over two years in order to "balance" the sale of F15s to Saudi Arabia and maintain Israel's "qualitative technological edge."
Intimate cooperation between the armed forces and arms industries of the two countries have created a two-way street that makes the prospect of U.S. retaliation against Israeli extremely unpopular with powerful elements in the American military and arms industry. The Pentagon receives detailed information from Israel on the performance of U.S.-supplied weapons, some of which the United States has never used in combat.
U.S. sources said last week that the Hawkeye E2C electronic reconnaissance plane, obtained by Israel from the U.S. Navy, received a combat test pinpointing distant aircraft targets in Syria in the early stages of the fighting in Lebanon. Israel's raid on Iraq's nuclear reactor last year employed F15s and F16s in military strikes for the first time.
The story of how Israel helped develop a key improvement for the F15 is another example of the value to the United States of the close working arrangements between the defense industries and armed forces of the two countries, officials said. The improvement involved special fuel tanks and equipment pods fitted to the outside of the aircraft to increase its combat range by more than 550 miles.
When Israel was offered the plane in the late 1970s, these features were lacking. McDonnell Douglas, the plane's manufacturer, had the concept for them, but the U.S. Air Force did not have funds for the research and development. The solution was for the Israeli Air Force to pay McDonnell Douglas to develop the fuel tanks, using U.S. military aid .
Israel Aircraft Industries subsequently produced the fuel tanks in Israel, with permission from the U.S. government, and the U.S. Air Force has now ordered the tanks for its own and Saudi Arabia's F15s. McDonnell Douglas has signed an agreement with IAI to manufacture some of the tanks in Israel.