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Helping Israel avoid delusion


ONE OF the leading journalists in Israel, a Labor Party member and no friend of the Shamir government, expressed to me better than anyone what is so wrong with present relations between the United States and Israel.

"Everyone thinks Baker and Bush are smart and Shamir is primitive," this man said when I was in Tel Aviv earlier this summer. "But Shamir has maneuveredthem into the situation where, instead of talking peace, the major question is why the Americans are not giving us the money for the Russian immigrant loan guarantees.

"Suddenly it is Bush who is apologizing instead of talking peace and humanitarian issues. Israelis know Shamir made mistakes in the past and survived. They know he will get the money, and the Likud will be re-elected again."

My friend's scenario is now being enacted before our eyes in the nation's capital.

First, the truth of the matter: The rightist government of Prime Minister Yitzhak Shamir is asking of the United States a considerable favor. It wants the U.S. government to guarantee bank loans of $10 billion to be used for the resettlement of Russian Jewish immigrants. This would cost the American government -- and, thus, the American taxpayer -- between $100 million and $800 million that the U.S. treasury would have to put aside as a reserve against loan defaults. This is in addition to the $1.2 billion in annual aid to Israel, plus $1.8 billion in annual military sales, plus $400 million given last year also for immigrant settlement.

Then look at the character and consistency of the "play" here in Washington: Israel "demands" the money. Israel is "defiant" and "dismayed" by any delays in the money. Israel categorically "rejects" any delay on the part of President Bush and Secretary Baker, and Shamir "angrily refuses" any idea of halting the settlements in the occupied territories.

The Israeli lobby swings into action and sends 1,000 Jewish leaders and lobbyists to Congress to "demand" the money. At the same time, an all-out campaign to free Jonathan Pollard, the convicted spy who gave away American intelligence to Israel, is started so that the $10 billion seems small in the overall cacophony of endless demands. Congress falls immediately and obediently into line behind every demand and Bush looks as though it is he who is asking the favor.

My friend was all too right.

Now, think on another level. Think of the price of all of this delusionary maneuvering.

Israel is seeking these funds, Israeli officials admit, to offset a deficit running at 7 percent of gross national product. The first $2 billion installment of the loan would cover about half the deficit, Israeli newspapers reported this summer.

In the Orwellian world of the Shamir government's demands, it is the massive spending for tens of thousands of housing units in the occupied territories (all illegal under international law) that has largely led to the deficit, the annual inflation rate of 20 percent, and an economy that has no new-tech investment that would integrate the Russian immigrants and is now totally dependent on expected outside charity.

And now still another factor comes into play in the drama of demands. Prime Minister Shamir has announced a sharp increase in defense spending, overriding the pleas of his own finance officials, by 6 percent above the current $4.5 billion figure.

Even senior Israeli military officials openly describe the increase -- coming on the heels of the gulf war, which substantially reduced the risk to Israel in the Middle East -- as part of a new Middle East arms race in which Israel will seek to develop weapons such as anti-ballistic missiles and its own intelligence satellite.

President Bush and Secretary Baker are sophisticated enough in the Machiavellian ways of the world to realize that the Shamir government is using the $10 billion not really for the settlement of Russian Jewish immigrants but to fortify its constant expansion of power, its eventual takeover of the West Bank and its use of this country.

The loan guarantees should be given eventually, but they should be given in an atmosphere of American policy interests and not Israeli threats and demands. If need be, President Bush should make this clear to the American people.

Policy should be crafted, as Bush and Baker are trying to craft it, in terms of American and Israeli long-term interests, and not in terms of the expansionist interest of far-right groups. The long-term interests constitute a reform of Israel's dependent and cockeyed socialist economic structure, the real movement toward peace which is now for the first time possible in the area, and movement toward Israeli independence from charity and the contortions that it invariably brings.

We have seen with all too much pain the eventual price of delusion in the Soviet Union. The greatest aid America can give to Israel now is to help it to avoid that delusion.

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