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Jewish Groups Angry at President for Rejecting Compromise on Loans

March 19, 1992
See Original Daily Bulletin From This Date

Despite President Bush’s refusal to accept a Senate compromise, American Jewish groups are not giving up the fight to win U.S. guarantees for $10 billion in loans Israel wants to help resettle immigrants.

While the Jewish groups concede they have lost the battle to have loan guarantees legislation enacted by a March 31 congressional deadline, they are still hoping to win the U.S. assistance eventually.

“The request will be made again — maybe in June or in September,” Shoshana Cardin, chairman of the Conference of Presidents of Major American Jewish Organizations, said at a news conference Wednesday.

“I don’t think we should look at this as the end game.”

Cardin was clearly angry at President Bush’s decision Tuesday not to back a compromise plan on loan guarantees legislation proposed by Sens. Patrick Leahy (D-Vt.) and Robert Kasten (R-Wis.).

In Washington, Leahy seemed similarly upset.

“There seems no recognition in the White House that a negotiation requires compromise by all parties, not by just one side,” he said in a speech Wednesday on the Senate floor.

“What was asked of us was not compromise, but capitulation,” he said.

Under the terms of his proposal, up to $10 billion in guarantees would have been authorized over five years. After the first year, the White House would determine how much Israel needed, and would release the guarantees accordingly.

The president would further have the right to suspend the guarantees if he deemed Israeli settlement activity “inappropriate.”

And between $350 million and $400 million worth of guarantees would have been deducted from the first year’s authorization, to reflect the cost of current housing construction in the administered territories.


Six months ago, these conditions would have been anathema to most Jewish groups, who insisted that the loan guarantees are needed for humanitarian purposes and should not be linked at all to politics.

But this week, Jewish organizations were angry that Bush had not agreed to these terms.

State Department spokeswoman Margaret Tutwiler justified Bush’s threat to veto the Leahy compromise, saying it did not press Israel enough to adhere to the U.S. government’s longstanding opposition to settlements in the territories.

“The Congress has asked the administration to issue loan guarantees first, then ask questions later, and that is simply not acceptable,” explained Tutwiler.

In light of the veto threat, Leahy urged his colleagues not to submit any last-minute bills or amendments authorizing the loan guarantees, saying a veto “would be a calamity for U.S. Israeli relations, already rocked hard enough.”

In New York, Cardin said that the White House decision not to compromise threatened to harm more than ties with the Jewish state.

“It is bad for the cause of Mideast peace, bad for our friend and ally Israel, and bad for the American economy,” she said.

“We believe that this rejection of Israel’s request will undermine the peace process and encourage further intransigence among the Arab parties to the negotiations,” she said.

“We are concerned that Israel will be pressured, and be seen as subject to pressure, in future efforts to bring about peace.”


Cardin also suggested that Bush had misled the American Jewish community about his willingness to support humanitarian assistance for the resettlement of up to a million immigrants from the former Soviet Union.

She recalled that the president had denied last July that the administration would link the loan guarantees to the Middle East peace process. She also said that after a meeting with Bush last fall, the conference was left with the impression that he would “move to seek a compromise.”

Malcolm Hoenlein, the conference’s executive director, said that Israel had made a fair effort to reach a compromise with the Bush administration, which has insisted that Israel freeze all settlement activity in the administered territories as a condition for receiving the U.S. guarantees.

Hoenlein pointed out that Israel had accepted the idea of deducting money from the amount of loans guaranteed to offset any funds spent in the territories, despite its longstanding belief that the two issues should not be connected.

But even so, he said, the administration would not agree to the compromise.

William Rapfogel of the Union of Orthodox Jewish Congregations of America said he was “extremely disappointed” at Bush’s refusal to back the Senate proposal.

He accused the administration of continuing to “move the goal posts” by placing new conditions on Israel.

Rapfogel, who is executive director of the Orthodox Union’s Institute for Public Affairs, said the Senate compromise Bush rejected is something he “would have jumped at in September.”

By accepting it, he would have been able to “declare a victory” in getting Israel to agree to conditions relating to its settlement activity.

(JTA correspondent Howard Rosenberg in Washington contributed to this report.)

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