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U.S. Wants to Back Loan Package, White House Official Tells Njcrac

February 18, 1992
See Original Daily Bulletin From This Date

The White House wants to support loan guarantees for immigrant absorption in Israel, a high-level Bush administration official told a national gathering of Jewish community leaders here this week.

But the Israeli government must consider the loans important enough to accede to U.S. conditions, Richard Haass, a senior director on the National Security Council, said in an address Sunday to the annual plenum of the National Jewish Community Relations Advisory Council.

Haass, who also ranks as a special assistant to President Bush, did not spell out what those conditions were.

But the administration is understood to have demanded a phased-in freeze on construction of homes in the Jewish settlements of the administered territories.

The U.S. guarantees are needed to help Israel borrow $10 billion from private banks over the next five years. The money would be used to help absorb up to 1 million immigrants from the former Soviet Union and Ethiopia.

Without the U.S. guarantees, Israel would be charged a higher interest rate and be subject to less favorable repayment terms.

Israel’s ambassador to Washington, Zalman Shoval, told the NJCRAC delegates at the same session that he is confident “a formula can be worked out” with the United States to obtain the guarantees.

He acknowledged that “Israel, being on the receiving end, will have to go more than half way” toward meeting U.S. concerns.

Haass seemed to want to make sure the American Jewish community would place blame on the Likud government in Jerusalem for any failure to reach an agreement on the loans.


But Sen. Bob Packwood (R-Ore.) said that if the Bush administration and Israel cannot agree on conditions for the guarantees, Congress is prepared to pass a bill introduced last fall that would issue the guarantees without any political strings attached.

“I believe it could be moved,” he told the Jewish Telegraphic Agency. “And if vetoed, we could override.”

But, he added, “the leaders of the Jewish community, both here and abroad, are trying to weigh if the victory is worth the price.” That cost would be the Bush administration’s wrath at suffering a first-ever veto override.

“There could be lots of ways to take out their anger” at the Jewish community, said the senator.

Haass, in his remarks, insisted that the U.S. Israeli relationship “is better than it sound.”

But in a tacit admission that the partnership has long since passed the honeymoon stage, he reminded the NJCRAC delegates that “the mark of a good relationship is not that you agree; it is that you learn how to disagree.”

When America recently supported a U.N. Security Council resolution condemning Israel for the planned deportation of 12 Palestinians, that in fact illustrated “agreeing to disagree” in action, he said.

“This is a case where no surprises were sprung. The U.S. and Israel talked about it at extremely high levels weeks before. Each side was straightforward and very honest about their positions,” he said.

Regarding the loan guarantees, Haass said the administration believes that while resettling immigrants is a humanitarian effort, achieving peace “is also a humanitarian goal.”

In fact, he said, peace is what the new immigrants need to create “the kind of life they really deserve.”

Arguing that there is “a sense of urgency” to the peace process, the NSC official called on “all parties to avoid creating obstacles.”

Longstanding American policy describes the Israeli settlements as “obstacles to peace.”


During a question-and-answer period, Michael Pelavin of Flint, Mich, a past chair of NJCRAC, asked Haass to convey to the administration that “all of us in the room agree on the need for loan guarantees.”

Responded Haass: “I hope you hear the message I had. We want to make things happen, but in a way consistent with our goals. We will not be seen as fair if we don’t stand up for principles we believe in,” he said.

But Shoval argued on the contrary that American demands regarding settlements are not evenhanded and are, in fact, harmful to the peace process. They convince the Arab countries that concessions can be extracted from Israel without having to produce a quid pro quo, he said.

He acknowledged that settlements are a topic of debate among Jews in both Israel and the United States. But he said the debate in Israel is only a matter of where the settlements should be built.

“Some are for settlements only on the Jordan Valley or around Jerusalem, and others are for putting settlements everywhere, or especially on the hilltops,” he said.

“Did you ever hear from those opposing settlements whether they differentiate between settlements here or there, including Jerusalem?”

According to reports of Shoval’s recent discussions with Secretary of State James Baker, the U.S. proposal on the settlements would allow Israel to complete construction of at least 6,000 housing units in the administered territories. That is roughly the amount built during the last four years of Israel’s Labor-Likud unity government, which fell in March 1990.


Shoval said Israel could never agree to a ban on Jewish construction in the territories, calling it “a form of apartheid.”

He equated it with the “abhorrent” proposal to expel Israeli Arabs from the country. That policy, known as “transfer,” is the banner of the Moledet party, which pulled out of the Likud-led government last month.

Shoval said the urgency of the loan guarantees — and of the aliyah from the republics of the former Soviet Union — is “very great.”

“You will understand why we can’t say about the reports we have had,” he said, presumably referring to documentation of anti-Semitic threats in the successor states to the Soviet Union.

“We will be very sorry if one day we will say, Jews did not come to Israel when they could because, among other things, Israel did not get the help it needed,” the ambassador said.

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