Fw: cost of subsidizing a prodigal son
In my opinion, here is another fine example of domestic political expedience triumphing over economic rationality. Of course, money isn't everything, but one also has to ask: what will we ultimately have to show for our national "investment?" And why do our politicians persist in throwing good money after bad when it is so obviously counterproductive? Might this be an example of the special interest influence we were discussing a few days ago in the "median voter" thread? ~Alypius http://www.csmonitor.com/2002/1209/p16s01-wmgn.htmlSince 1973, Israel has cost the United States about $1.6 trillion By David R. Francis | Staff writer of The Christian Science Monitor Since 1973, Israel has cost the United States about $1.6 trillion. If divided by today's population, that is more than $5,700 per person. This is an estimate by Thomas Stauffer, a consulting economist in Washington. For decades, his analyses of the Middle East scene have made him a frequent thorn in the side of the Israel lobby.For the first time in many years, Mr. Stauffer has tallied the total cost to the US of its backing of Israel in its drawn-out, violent dispute with the Palestinians. So far, he figures, the bill adds up to more than twice the cost of the Vietnam War.And now Israel wants more. In a meeting at the White House late last month, Israeli officials made a pitch for $4 billion in additional military aid to defray the rising costs of dealing with the intifada and suicide bombings. They also asked for more than $8 billion in loan guarantees to help the country's recession-bound economy.Considering Israel's deep economic troubles, Stauffer doubts the Israel bonds covered by the loan guarantees will ever be repaid. The bonds are likely to be structured so they don't pay interest until they reach maturity. If Stauffer is right, the US would end up paying both principal and interest, perhaps 10 years out.Israel's request could be part of a supplemental spending bill that's likely to be passed early next year, perhaps wrapped in with the cost of a war with Iraq.Israel is the largest recipient of US foreign aid. It is already due to get $2.04 billion in military assistance and $720 million in economic aid in fiscal 2003. It has been getting $3 billion a year for years.Adjusting the official aid to 2001 dollars in purchasing power, Israel has been given $240 billion since 1973, Stauffer reckons. In addition, the US has given Egypt $117 billion and Jordan $22 billion in foreign aid in return for signing peace treaties with Israel."Consequently, politically, if not administratively, those outlays are part of the total package of support for Israel," argues Stauffer in a lecture on the total costs of US Middle East policy, commissioned by the US Army War College, for a recent conference at the University of Maine.These foreign-aid costs are well known. Many Americans would probably say it is money well spent to support a beleagured democracy of some strategic interest. But Stauffer wonders if Americans are aware of the full bill for supporting Israel since some costs, if not hidden, are little known.One huge cost is not secret. It is the higher cost of oil and other economic damage to the US after Israel-Arab wars.In 1973, for instance, Arab nations attacked Israel in an attempt to win back territories Israel had conquered in the 1967 war. President Nixon resupplied Israel with US arms, triggering the Arab oil embargo against the US.That shortfall in oil deliveries kicked off a deep recession. The US lost $420 billion (in 2001 dollars) of output as a result, Stauffer calculates. And a boost in oil prices cost another $450 billion.Afraid that Arab nations might use their oil clout again, the US set up a Strategic Petroleum Reserve. That has since cost, conservatively, $134 billion, Stauffer reckons.Other US help includes:• US Jewish charities and organizations have remitted grants or bought Israel bonds worth $50 billion to $60 billion. Though private in origin, the money is "a net drain" on the United States economy, says Stauffer.• The US has already guaranteed $10 billion in commercial loans to Israel, and $600 billion in "housing loans." Stauffer expects the US Treasury to cover these.• The US has given $2.5 billion to support Israel's Lavi fighter and Arrow missile projects.• Israel buys discounted, serviceable "excess" US military equipment. Stauffer says these discounts amount to "several billion dollars" over recent years.• Israel uses roughly 40 percent of its $1.8 billion per year in military aid, ostensibly earmarked for purchase of US weapons, to buy Israeli-made hardware. It also has won the right to require the Defense Department or US defense contractors to buy Israeli-made equipment or subsystems, paying 50 to 60 cents
RE: cost of subsidizing a prodigal son
And why do our politicians persist in throwing good money after bad when it is so obviously counterproductive? Is NOT intuitively obvious. As a Zionist, albeit a supporter of the Oslo Process, I would ask why the support of Israel is so obviously counter-productive? Can you name any ARAB/African nation that has supported the US consistently for the last 54 years? Various REGIMES have, until their overthrow, but almost no nations, Somalia under Barre, but not his predecessor, Ethiopia under Haile Selassee (sp.), but not Mengistu, Egypt under Farouk, but not after Nasser, Iraq in the 1950's but not after the Ba'ath Revolution. All of which points out that Israel represents a functioning, liberal democracy, with strong human rights guarantees for ALL its citizens, unlike its neighbors. So, why is it so obviously counterproductive to provide support for Israel? The story highlight the connection between domestic politics and international relations, to an extent. Israel's biggest supporters, in the last 15-20 years have been REPUBLICANS, though Jews tend to vote overwhelmingly for Democrats, so even this is not amenable to a simplistic Marxian Dance with the one what brung you analysis. -Original Message-From: Alypius Skinner [mailto:[EMAIL PROTECTED]]Sent: Tuesday, December 10, 2002 1:14 PMTo: [EMAIL PROTECTED]Subject: Fw: cost of subsidizing a prodigal son In my opinion, here is another fine example of domestic political expedience triumphing over economic rationality. Of course, money isn't everything, but one also has to ask: what will we ultimately have to show for our national investment? And why do our politicians persist in throwing good money after bad when it is so obviously counterproductive? Might this be an example of the special interest influence we were discussing a few days ago in the median voter thread? ~Alypius http://www.csmonitor.com/2002/1209/p16s01-wmgn.htmlSince 1973, Israel has cost the United States about $1.6 trillion By David R. Francis | Staff writer of The Christian Science Monitor Since 1973, Israel has cost the United States about $1.6 trillion. If divided by today's population, that is more than $5,700 per person. This is an estimate by Thomas Stauffer, a consulting economist in Washington. For decades, his analyses of the Middle East scene have made him a frequent thorn in the side of the Israel lobby.For the first time in many years, Mr. Stauffer has tallied the total cost to the US of its backing of Israel in its drawn-out, violent dispute with the Palestinians. So far, he figures, the bill adds up to more than twice the cost of the Vietnam War.And now Israel wants more. In a meeting at the White House late last month, Israeli officials made a pitch for $4 billion in additional military aid to defray the rising costs of dealing with the intifada and suicide bombings. They also asked for more than $8 billion in loan guarantees to help the country's recession-bound economy.Considering Israel's deep economic troubles, Stauffer doubts the Israel bonds covered by the loan guarantees will ever be repaid. The bonds are likely to be structured so they don't pay interest until they reach maturity. If Stauffer is right, the US would end up paying both principal and interest, perhaps 10 years out.Israel's request could be part of a supplemental spending bill that's likely to be passed early next year, perhaps wrapped in with the cost of a war with Iraq.Israel is the largest recipient of US foreign aid. It is already due to get $2.04 billion in military assistance and $720 million in economic aid in fiscal 2003. It has been getting $3 billion a year for years.Adjusting the official aid to 2001 dollars in purchasing power, Israel has been given $240 billion since 1973, Stauffer reckons. In addition, the US has given Egypt $117 billion and Jordan $22 billion in foreign aid in return for signing peace treaties with Israel.Consequently, politically, if not administratively, those outlays are part of the total package of support for Israel, argues Stauffer in a lecture on the total costs of US Middle East policy, commissioned by the US Army War College, for a recent conference at the University of Maine.These foreign-aid costs are well known. Many Americans would probably say it is money well spent to support a beleagured democracy of some strategic interest. But Stauffer wonders if Americans are aware of
RE: cost of subsidizing a prodigal son
.obviously counterproductive? Why? You see NO benefits at all from these expenditures, is not one the fall of the Soviet Union? We countered each effort of the Soviet Union to expand in the cold war. So funds spent back as far as 1973 helped in that effort. Is fall of USSR a benefit that was worth paying? Was it worth stopping Soviet Expansion and supporting a democratic society in the Middle East? Do we not benefit from the more free market societies around the world post USSR? We can argue on the value, but to imply we got nothing is a little one sided. Along with other benefits do they counterbalance the costs? Does more investment increase those benefits or assure continuation of prior benefits? The article is very one sides. Talks to lost jobs by Israel block of weapons purchase by Saudi Arabia but doesnt recognize jobs from weapons sales to Israel. Blame the oil embargo on Israel. Scherers book on industries has a good chapter on oil industry and the embargos that never mentions Israel. I think appropriately so. jdd John D Driessnack, PMP, CCE/A Professor, Defense Acquisition University -Original Message- From: Alypius Skinner [mailto:[EMAIL PROTECTED]] Sent: Tuesday, December 10, 2002 1:14 PM To: [EMAIL PROTECTED] Subject: Fw: cost of subsidizing a prodigal son In my opinion, here is another fine example of domestic political expedience triumphing over economic rationality. Of course, money isn't everything, but one also has to ask: what will we ultimately have to show for our national investment? And why do our politicians persist in throwing good money after bad when it is so obviously counterproductive? Might this be an example of the special interest influence we were discussing a few days ago in the median voter thread? ~Alypius http://www.csmonitor.com/2002/1209/p16s01-wmgn.html Since 1973, Israel has cost the United States about $1.6 trillion By David R. Francis | Staff writer of The Christian Science Monitor Since 1973, Israel has cost the United States about $1.6 trillion. If divided by today's population, that is more than $5,700 per person. This is an estimate by Thomas Stauffer, a consulting economist in Washington. For decades, his analyses of the Middle East scene have made him a frequent thorn in the side of the Israel lobby. For the first time in many years, Mr. Stauffer has tallied the total cost to the US of its backing of Israel in its drawn-out, violent dispute with the Palestinians. So far, he figures, the bill adds up to more than twice the cost of the Vietnam War. And now Israel wants more. In a meeting at the White House late last month, Israeli officials made a pitch for $4 billion in additional military aid to defray the rising costs of dealing with the intifada and suicide bombings. They also asked for more than $8 billion in loan guarantees to help the country's recession-bound economy. Considering Israel's deep economic troubles, Stauffer doubts the Israel bonds covered by the loan guarantees will ever be repaid. The bonds are likely to be structured so they don't pay interest until they reach maturity. If Stauffer is right, the US would end up paying both principal and interest, perhaps 10 years out. Israel's request could be part of a supplemental spending bill that's likely to be passed early next year, perhaps wrapped in with the cost of a war with Iraq. Israel is the largest recipient of US foreign aid. It is already due to get $2.04 billion in military assistance and $720 million in economic aid in fiscal 2003. It has been getting $3 billion a year for years. Adjusting the official aid to 2001 dollars in purchasing power, Israel has been given $240 billion since 1973, Stauffer reckons. In addition, the US has given Egypt $117 billion and Jordan $22 billion in foreign aid in return for signing peace treaties with Israel. Consequently, politically, if not administratively, those outlays are part of the total package of support for Israel, argues Stauffer in a lecture on the total costs of US Middle East policy, commissioned by the US Army War College, for a recent conference at the University of Maine. These foreign-aid costs are well known. Many Americans would probably say it is money well spent to support a beleagured democracy of some strategic interest. But Stauffer wonders if Americans are aware of the full bill for supporting Israel since some costs, if not hidden, are little known. One huge cost is not secret. It is the higher cost of oil and other economic damage to the US after Israel-Arab wars. In 1973, for instance, Arab nations attacked Israel in an attempt to win back territories Israel had conquered in the 1967 war. President Nixon resupplied Israel with US arms, triggering the Arab oil embargo against the US. That shortfall in oil deliveries kicked off a deep recession. The US lost $420 billion (in 2001 dollars) of output as a result, Stauffer calculates. And
