Israel and Jewish Groups Decry Linkage of Loans to Settlements
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Israel and Jewish Groups Decry Linkage of Loans to Settlements

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Israel’s pained reaction to U.S. conditions for underwriting $10 billion in immigrant absorption loans was made clear to a gathering of American Jewish leaders here Tuesday.

Defense Minister Moshe Arens, a former ambassador to Washington, was sharply critical of the terms laid down by Secretary of State James Baker on Monday before the House Appropriations subcommittee on foreign operations.

He complained that the loans Israel needs for humanitarian purposes are being linked to the political issue of Jewish settlement-building in the West Bank and Gaza Strip, which the Bush administration wants stopped.

The United States is saying in effect, “We know you need the help, we can give you the help, but we are not going to do it unless you do such and such first,” Arens told members of the Conference of Presidents of Major American Jewish Organizations, who were in Jerusalem on their annual study mission.

Arens had to address them by telephone from Tel Aviv, because a blizzard made Jerusalem inaccessible.

The United States has “the absolute right to decide how it wants to spend its money,” Arens said. But he stressed that it has never before tried to apply linkage of this kind in its relations with Israel.

Baker’s testimony got an equally negative response from American Jewish groups.

In New York, the Anti-Defamation League issued a statement charging that the administration is using the loan guarantees “to intrude itself into the peace process,” which “is a counterproductive and dangerous precedent.”


A statement issued by the ADL’s national chairman, Melvin Salberg, and its national director, Abraham Foxman, insisted that “the question of Israeli settlement activity is an issue to be reached at the Arab-Israel negotiating table.

“By linking loan guarantees to a general halt in settlements, the administration undermines its role as honest broker in the peace process,” they said.

Robert Lifton, president of the American Jewish Congress, said Baker’s attempt “to link American assistance to an end to Israeli settlement policy” is “regrettable and unwarranted.”

The National Jewish Community Relations Advisory Council said in a memo to its member agencies that Baker’s testimony “would appear to diminish the possibility of accommodation of the loan guarantee program.”

It encouraged them to lobby Congress, the administration and the media over the issue.

“We continue to urge our government and the government of Israel to reach an agreement in the context of shared interests, which will enable the necessary legislation to be enacted expeditiously by the Congress,” the NJCRAC memo said.

The Conference of Presidents mission, meanwhile, was also addressed by Jerusalem Mayor Teddy Kollek, who attacked the Likud government and specifically Housing Minister Ariel Sharon for giving ideology priority over practical housing needs in the capital.

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