When Jordan’s King Hussein came to Washington last month, President Clinton promised to ask Congress to forgive Jordan’s $700 million debt if there were significant strides toward peace, including a public meeting with Israeli Prime Minister Yitzhak Rabin.
In light of Monday’s historic White House meeting and the unprecedented address the Israeli and Jordanian leaders were set to make to a joint session of Congress, uncertainty abounds over whether Clinton can deliver congressional support for his pledge.
Observers believe that Jordan has moved ahead unilaterally with Israel at least in part because of the potential economic payoff.
But Jordanian expectations of economic benefits resulting from reconciliation with Israel raise the larger question of whether the United States will be willing — or able — to fund peace in the Middle East.
One point on which all analysts agree is that times have changed significantly since Israel and Egypt signed a peace treaty in 1979 — and egan to receive what has amounted to annual peace dividend checks of $3 billion and $2.1 billion, respectively.
Coinciding with the White House ceremony on Monday, Clinton administration officials began discussions with Capitol Hill leaders on a proposal to forgive $200 million in Jordanian debt immediately, according to sources close to the negotiations.
The administration will ask House and Senate conferees to include the money when they reconcile differences in the foreign aid bill which has passed both chambers of Congress.
The proposal would be the first step in what White House officials hope will be a broader package.
But even if consensus emerges on Capitol Hill to forgive Jordan’s debt, many analysts say budget restrictions could prevent a quick fix for Jordan’s mounting debt.
JORDAN OWES SOME $6.6 BILLION
Jordan’s debt to the United States accounts for only a fraction of its $6.6 billion in outstanding loans, primarily from European nations. Debt payments amount to almost 30 percent of Jordan’s total annual budget.
In addition to going to Congress, Clinton has pledged to ask other debtor nations to restructure and forgive much of Jordan’s debt.
Clinton originally left his offer to Hussein vague, according to White House officials. Clinton had told Hussein that he would have to take significant strides toward peace with Israel, and perhaps even sign a full peace treaty, in order to get Congress on board for debt relief.
Members of Congress themselves have echoed a similar position.
Many lawmakers have said they want to see, at the minimum, a pledge for full normalization of relations between Israel and Jordan before considering debt forgiveness.
But some on Capitol Hill want Jordan to go further — disavowing the Arab boycott of Israel, beefing up sanctions against Iraq and agreeing never to harbor terrorists.
Those who oppose debt relief until a peace treaty is signed say Clinton’s pledge amounts to a “typical administration ploy,” according to one senior Capitol Hill staffer.
“You make the promise and then shove it down Congress’ throat and blame Congress for the failure of the entire peace process if it doesn’t go along,” the staffer said, echoing the sentiment express by many on Capitol Hill.
In addition to circulating a preliminary proposal to forgive $200 million of Jordan’s debt, Clinton has taken other steps on the debt issue.
The Office of Management and Budget is preparing for the White House, at Clinton’s request, an exact accounting of Jordan’s debt.
CLINTON MAY ASK FOR JORDANIAN MILITARY AID
Jordanian officials estimate their country’s debt to the United States at $900 million rather than the $700 million the State Department lists.
According to the Congressional Budget Office, the discrepancy comes from technical calculations that depend on when interest and principal of the loans would be paid.
Before Congress could vote to forgive Jordan’s debt, lawmakers would have to cut spending or raise taxes to offset the bill for debt relief.
In 1992, Congress and the then-Bush White House agreed to offset any new spending by cuts in other programs or new taxes. In order to forgive Jordan’s debt, therefore, the appropriations committees in the House of Representatives and the Senate must find savings or raise taxes to pay off the loans.
Clinton is also expected to ask Congress for a handsome package of military aid that would update the Jordanian army and could conceivably provide high-technology U.S. aircraft.
Many in Congress and in the Jewish community are waiting for the excitement from this week’s visit to settle before they weigh in on debt forgiveness and military aid.
Capitol Hill staffers warn not to expect the so-called pro-Israel members of Congress to carry the ball on money to Jordan.
“We just finished the push for Israel’s $3 billion and Egypt’s $2.1 billion. This effort is going to have to come from members like Obey and Leahy,” a senior Senator’s aide said.
U.S. Rep. David Obey (D-Wisc.) serves as the chairman of the Foreign Operations Appropriations Committee. Sen. Patrick Leahy (D-Vt.) chairs the Senate committee where any hearings on debt forgiveness would begin.
Both Obey and Leahy refused to comment on any possible package for Jordan until after the committees meet to debate the possibility.
Their aides say hearings could start as early as next month but caution not to expect results until after the fiscal year ends Sept. 30.
The American Israel Public Affairs Committee, which supports some form of aid to Jordan, is in the process of formulating its own policy as well as strategy on this issue. AIPAC staffers have begun consulting with members of Congress to assess the mood on the Hill before proceeding.
Most other Jewish organizations have not yet determined how active they will be on the aid-to-Jordan issue.
The Archive of the Jewish Telegraphic Agency includes articles published from 1923 to 2008. Archive stories reflect the journalistic standards and practices of the time they were published.
