News Analysis: Foreign Aid and Wye Package Get Trapped in U.S. Budget Battles

Israel’s backers in Washington have long sought to ensure that foreign aid to the Jewish state remains above the partisan fray.

This year, however, that has not happened.

With Congress and the White House battling over the budget, Israel’s nearly $3 billion in annual aid as well as funds to help Israel and the Palestinians implement last year’s Wye River accord have been caught in the political wrangling.

A $12.6 billion foreign aid bill narrowly passed both houses of Congress last week, but President Clinton will veto the bill because it falls $2 billion short of his request and does not include funding for Wye, a Clinton administration official said.

Nonetheless, the annual aid for Israel — as well as nearly $2 billion for Egypt, $225 million for Jordan and $75 million intended for the Palestinians – – is expected to ultimately find its way to the Middle East.

Less certain, however, is when and how an additional $1.3 billion — which represents the first two installments of a proposed $1.9 billion, three-year package in Wye aid the administration is seeking — will be funded.

After the signing of the Wye accord last October, Clinton asked Congress to provide Israel, Jordan and the Palestinians with special funds to help implement the deal, which, among other things, called on Israel to undertake a further withdrawal from the West Bank in three phases in exchange for an aggressive Palestinian effort to root out terrorism.

At the time, congressional Republicans raised questions about how to pay for the package. Those questions became moot after implementation of the agreement was halted by then-Israeli Prime Minister Benjamin Netanyahu.

But now, with the agreement moving forward after Israeli Prime Minister Ehud Barak and Palestinian Authority Chairman Yasser Arafat reached a new understanding in Egypt last month, funding for Wye has become an issue once again.

In a sign of the political showdown over spending priorities, all of the Jewish Democratic lawmakers in both the House and the Senate — in an unprecedented move — voted against the foreign aid bill.

Nearly all of the 21 Jewish Democrats met late last month at the request of Rep. Henry Waxman (D-Calif.), the senior Jewish Democrat in the House, and decided as a group to vote against the bill.

The Jewish lawmakers, who have routinely been the driving force in advocating for passage of the foreign aid bill, say they voted against the measure because it did not provide funding for Wye and because it shortchanged assistance programs in Africa and Latin America.

Despite their opposition, the bill passed by a vote of 214-211 in the House on Oct. 5 and by a 51-49 vote in the Senate the next day.

The only two Jewish lawmakers to vote for the bill were Sen. Arlen Specter (R- Pa.) and Rep. Benjamin Gilman (R-N.Y.), the two Jewish Republicans in Congress.

Lewis Roth, a spokesman for Americans for Peace Now, a group that has actively lobbied for the Wye aid, said it was important for the Jewish lawmakers to take such a stance.

“Jewish lawmakers in Congress recognize that U.S. policy vis-a-vis Israel does not take place in a vacuum,” Roth said.

“If Israel is going to exist in a stable environment then it is very important for the United States to be engaging as much as possible throughout the region and the world.”

An administration official, speaking on condition of anonymity, agreed.

“A bill that is dominated by the Middle East is not a good idea,” the official said, expressing a view echoed by Jewish lawmakers and activists who say such a bill becomes an easier target for cuts.

But Matthew Brooks, executive director of the Republican Jewish Coalition, criticized Democrats for holding “Israel’s aid hostage for their own political objectives.”

He said the razor-thin vote was a “tremendous defeat for foreign aid in general.”

Democrats, however, did not seem concerned about being attacked for voting down a foreign aid bill that included assistance to Israel.

“The pro-Israel vote was a `no’ vote,” said Amos Hochstein, a top aide to Rep. Sam Gejdenson (D-Conn.), the ranking Democrat on the House International Relations Committee.

Republicans have also accused Democrats — who overwhelmingly supported the foreign aid bill when it first passed Congress during the summer — of voting against this legislation as part of a larger effort to scuttle passage of the various spending bills required to fund the government. After passing the House and Senate, the foreign aid bill then went to a conference committee to iron out differences between the two houses. The new measure was what was voted on last week.

By defeating these measures, the Republicans charge, they are trying to force congressional Republicans to provide more funding for the president’s initiatives.

Republicans have also said the president did not specifically ask Congress to include money for Wye in the foreign aid bill.

The administration official acknowledged that the White House did not specify that Wye be included in the foreign aid bill, but he said the measure was a “tailor-made vehicle and they chose not to use it.”

A top aide to Rep. Sonny Callahan (R-Ala.), chairman of the House Appropriations Foreign Operations Subcommittee, said Republicans would be more open to looking at ways to fund Wye and other of the administration’s priorities if he would sign the foreign aid bill.

“Goodwill begets goodwill,” Jo Bonner, Callahan’s chief of staff, said, adding that the Republicans were constrained by tight budget caps imposed as part of the 1997 balanced budget agreement.

Meanwhile, the partisan fight over spending priorities put the American Israel Public Affairs Committee in an awkward position concerning the vote, observers said.

The pro-Israel lobby usually leads the way in urging members to back the annual foreign aid bill. Although the group said it supports the bill because it includes Israel’s aid, Capitol Hill aides and others said AIPAC did not aggressively lobby for it because the Wye funding — which it has been strongly lobbying for — was not included.

Realpolitik also appeared to play a role in the lobby’s effort to steer clear of the partisan battle. AIPAC nominally supported the bill in an effort not to alienate Republicans who were looking for its backing to pass the bill.

On the other hand, it did not want to push hard for a measure that AIPAC officials knew had no support among Democrats, specifically the Jewish Democrats who led the way in trying to kill the measure.

“How can they lobby for a bill that all the Jews are against?” said one Democratic aide.

Those closely following the budget process say the White House and both parties in Congress want to fund Wye, but the question comes down to how to pay for it.

“The prospects for Wye aid are good,” said one pro-Israel activist who asked to remain anonymous. “The issue is to find the appropriate vehicle.”

After the president vetoes the bill, it will go back to House and Senate negotiators who could work with the White House to revamp the bill and send it back to the president.

What is more likely, observers said, is that the foreign aid bill and possibly the Wye aid could be wrapped up in a catch-all spending bill, known as an omnibus bill, for fiscal year 2000.

“Serious observers of the congressional budget process understand that the push for the Wye money is only just beginning,” said Kenneth Bricker, an AIPAC spokesman.

As they await the outcome of the budget battle, the Israelis, who are hesitant to talk about the partisan fighting, are concerned there could be a delay in receiving the aid.

Each year, Israel normally receives its nearly $3 billion in economic and military aid in a lump sum payment on Oct. 30. The provision, known as “early disbursal, allows Israel to accrue interest on the money.

“Israel has started to implement Wye, specifically territorial movements that require the movement of forces and bases and all of the involved expenses,” said Mark Regev, a spokesman for the Israeli Embassy in Washington.

“We are already doing our part and we hope other parties would do the same.”