Israel: Background and U.S. Relations

Introduction

Despite Labor's setbacks, its warnings regarding the demographic challenge that high Arab birth rates could eventually present to continued Israeli political control over Palestinians gained traction among many Israelis, under the rubric of maintaining both a Jewish and a democratic state. In this context, Prime Minister Ariel Sharon, a longtime champion of the Israeli right and the settlement movement, split from Likud and established Kadima as a more centrist alternative in 2005. He was succeeded as Kadima's leader, first by Ehud Olmert, then by Tzipi Livni. Elections in February 2009 were a divided affair, with the Livni-led Kadima winning the most Knesset seats, but Binyamin Netanyahu's Likud leading the coalition because of an overall advantage for right-of-center parties. Netanyahu, who also was prime minister from 1996 to 1999, has subsequently led two additional coalitions following elections in January 2013 and March 2015.²

Demographic developments may partly explain why Israel's current Jewish population appears to be, as one analyst has written, "more nationalistic, religiously conservative, and hawkish on foreign policy and security affairs than that of even a generation ago."³ Distinct groups, such as Haredim ("ultra-Orthodox" Jews) from communities that predated Zionist immigration, and Russian-speaking Israelis who emigrated from the former Soviet Union in the 1990s,⁴ have increased their numbers and influence in Israeli society.

These trends' likely long-term effects on Israel's internal cohesion and its ties with the United States and other international actors are unclear. The near-universal military experience of its Jewish citizens and the continued mobilization of much of its population⁵ differentiate Israel from current generations in North America and Europe, as do a number of other factors such as Israel's geographic location and unique historical experience. Yet, Israeli leaders and significant segments of Israeli civil society regularly emphasize ongoing commitments to political, economic, and cultural connections and shared values with the United States and broader Western world.

Israel faces considerable estrangement between its Jewish and Arab citizens. Arabs comprise around 20% of the population, and Islamist movements are popular in some Arab Israeli communities.

Israel is a parliamentary democracy in which the prime minister is head of government and the president is a largely ceremonial head of state. The unicameral parliament (the Knesset) elects a president for a seven-year term. The current president, Reuven Rivlin, took office in July 2014.⁶ Israel does not have a written constitution. Instead, Basic Laws lay down the rules of government and enumerate fundamental rights. Israel has an independent judiciary, with a system of magistrates' courts and district courts headed by a Supreme Court.

The political spectrum is highly fragmented, with small parties exercising disproportionate power due to the relatively low vote threshold for entry into the Knesset (3.25%), and larger parties needing small party support to form and maintain coalition governments. Since Israel's founding, the average lifespan of an Israeli government has been about 23 months. In recent years, however, the Knesset has somewhat tightened the conditions for bringing down a government.

In Israeli Knesset elections held on March 17, 2015, Prime Minister Binyamin Netanyahu's Likud party finished with a six-seat advantage over the center-left Zionist Union (a joint list of the Labor and Ha'tnua parties), which was particularly striking because Likud had trailed by four seats in final pre-election polls. Many commentators attribute Likud's win at least partly to statements by Netanyahu in the final days of the campaign to persuade right-leaning voters to choose Likud over smaller parties in order to prevent Zionist Union from taking power.¹¹ Netanyahu appeared to renounce¹² his previously expressed willingness to accept the creation of a Palestinian state,¹³ before claiming shortly after the election that he still supports a "two-state solution" in principle but not under current realities.¹⁴

(Configuration by party)

Source: Economist.

Many observers speculate that Netanyahu will try to expand his governing majority by appealing to Yitzhak Herzog of the Zionist Union or Yair Lapid of Yesh Atid to join the coalition, and possibly forcing Ha'bayit Ha'Yehudi to the opposition. Netanyahu has kept open the position of foreign minister, perhaps anticipating international pressure on his government to show greater flexibility on issues relating to the Palestinians. In the words of one journalist:

Herzog would be an ideal foreign minister for Bibi, helping him show to the world the government's moderate face. Lapid, who is also a moderate, though less committed to the peace process than Herzog, could also suit Netanyahu as the government's centrist fig leaf.¹⁹

Israel has an advanced industrial, market economy in which the government plays a substantial role. Despite limited natural resources, the agricultural and industrial sectors are well developed. The engine of the economy is an advanced high-tech sector, including aviation, communications, computer-aided design and manufactures, medical electronics, and fiber optics. Israel still benefits from loans, contributions, and capital investments from the Jewish diaspora, but its economic strength has lessened its dependence on external financing.

As negotiations between Iran and the "P5+1" nations (United States, United Kingdom, France, China, Russia, and Germany) intensified in early 2015, Netanyahu gave a controversial speech before a joint meeting of Congress on March 3³⁷ arguing against the generally expected parameters of a deal by saying that the P5+1 could obtain a "better deal" on a number of counts.³⁸

Nevertheless, there are signals that Israeli officials are preparing to come to terms with a deal and to shift their focus toward insisting on its implementation and enforcement, as some former senior Israeli security officials have advised.³⁹ An unnamed Netanyahu senior advisor has been quoted as saying, "We have little choice now but to try and make sure that the Iranians at least adhere to this deal, as weak as it is."⁴⁰ Although some Israeli defense officials hint that a unilateral military strike against Iranian nuclear facilities remains an option to prevent Iran from acquiring a nuclear weapon, most analysts assert that such an option is less viable and likely than in the past.⁴¹

In early April, the P5+1 and Iran announced agreement on a political framework for a deal they seek to finalize by the end of June.⁴² Netanyahu stated that his cabinet was united in strong opposition to the framework, and he demanded that any final agreement must include clear Iranian recognition of Israel's right to exist.⁴³ Questions publicly released by Israel's government in early April regarding the political framework focused on possible gaps between the P5+1 and Iran on several topics.⁴⁴

In an April 4 interview, President Obama expressed understanding regarding Israelis' deep suspicions regarding Iranian intentions, while insisting that the framework accord takes Israel's interests into account.⁴⁵ Apparently seeking to assuage Israeli concerns, Obama in the same interview stated his commitment to Israel's "qualitative military edge" (QME) and deterrence capabilities, and his willingness to make additional commitments to Israel's security.⁴⁶ This might become more complicated in light of the possibility that sanctions relief for Iran could conceivably increase material support for the Lebanese Shiite group Hezbollah and other Iranian allies,⁴⁷ as well as Russia's announcement in mid-April 2015 that it intends to fulfill its agreement to provide Iran an upgraded anti-aircraft capability (the S-300 system) after having suspended performance for a number of years.

Netanyahu may see his efforts as instrumental in giving Israel a voice in a negotiating process in which it does not directly participate.⁴⁸ Some reports indicate that the Obama Administration has limited its consultations with Israel regarding the ongoing negotiations.⁴⁹ The Iran Nuclear Agreement Review Act of 2015 (P.L. 114-17), enacted on May 22, 2015, gives Congress the power to review any final agreement, and would delay any further sanctions relief for Iran until after the review period ends.

Israel and the United States have reportedly begun preliminary consultations on an aid and arms sales package to assuage Israeli concerns regarding a potential Iranian nuclear deal and address "qualitative military edge" requirements regarding newly-considered U.S. arms sales to Gulf Arab states (see "Preserving Israel's Qualitative Military Edge (QME)" below). Official negotiations may not take place until after a deal is finalized, at least partly due to an apparent Israeli desire not to be seen as giving tacit consent to a nuclear pact. Initial reports indicate that a package may include early supply of F-35 (Lightning II) next-generation fighter aircraft that Israel is purchasing, sales of refueling planes, and funding for Iron Dome and Arrow III missile defense batteries.⁵⁰

The Syrian civil war has increasingly become a security challenge for Israel. In April 2015, Israeli Defense Minister Moshe Ya'alon enunciated the following "red lines" regarding Syria:

We will not allow the transfer of quality weaponry to terror organizations, primarily Hezbollah, and we will know how to reach them and those that send them at any time and any place. We will not allow Iran or Hezbollah to establish terror infrastructure at our border with Syria, and we will know how to put our hand on anyone who threatens Israeli citizens, whether [the threats] are along our border or far beyond it.⁵²

Israel became militarily involved to a limited extent starting in early 2013. This involvement began with some strikes to retaliate against instances of artillery fire on its positions in the Golan Heights.⁵³ Subsequently, Israel has allegedly conducted a number of airstrikes to prevent the transfer of sophisticated missiles or anti-aircraft weapons from the Asad regime to Hezbollah.⁵⁴ Rebels, including many affiliated with Islamist groups such as the Nusra Front (also known as Jabhat al Nusra), Al Qaeda's Syrian affiliate, have wrested control of much of the territory in the Golan area from the Syrian government.

Israel's position became more complicated in January 2015 when it launched a deadly airstrike against Hezbollah fighters in Syria who may have posed a threat to Israel's military in the Golan, triggering a cycle of retaliatory fire between Israel and Hezbollah in Lebanon.⁵⁵ As speculation persists regarding the potential for another Israel-Hezbollah war, each successive incident poses a challenge to maintaining deterrence while avoiding significant escalation.⁵⁶ Israel's military is publicizing Hezbollah's weapons buildup and its alleged use of Lebanese civilian areas as strongholds,⁵⁷ probably in hopes of increasing the credibility of its threat to massively retaliate against a Hezbollah attack, and of rousing key international actors to work toward preventing or delaying conflict.⁵⁸

Israel seems to view the threat from Iran via Hezbollah in Lebanon and Syria as more acute than that from Sunni Islamists, underscoring an apparent divergence—at least in part—between U.S. and Israeli perceptions.⁵⁹ Nevertheless, the inroads made by the Islamic State into Syria and Iraq have raised Israeli security concerns regarding the creation of possible "safe havens" for international terrorists seeking to target Israelis or Jews. According to French authorities, the French-Algerian suspect in the May 2014 shooting deaths of an Israeli couple and two other people at the Jewish Museum of Belgium (in Brussels) had spent over a year in Syria and had links with "radical Islamists."⁶⁰ Although the suspects in the January 2015 Paris kosher deli and February 2015 Copenhagen synagogue killings had not been based in the Middle East, they reportedly drew inspiration from the Islamic State.

Another concern is that the Islamic State might ultimately seek to undermine order and monarchical rule in Jordan. Jordan has thus far weathered the unrest the Arab world has faced since 2011, but the situation in Syria and Iraq continues to present its leaders with challenges in maintaining internal stability and accommodating the needs of hundreds of thousands of refugees.

Israeli leaders, who had expressed concern about Egypt's future after Hosni Mubarak's removal in 2011 led to the election of Muslim Brotherhood figure Muhammad Morsi in 2012, have been very supportive of and cooperative with General-turned-President Abdel Fattah al Sisi following his July 2013 military-backed ouster of Morsi. Since then, Egyptian forces have reportedly been active in countering heightened militant activity in Sinai and along its border with the Gaza Strip, and in targeting Sinai-Gaza smuggling tunnels. Largely in response to deadly terrorist attacks in Sinai against Egyptian security personnel claimed to have been carried out by the Sinai Province of the Islamic State (SP, formerly known as Ansar Beit al Maqdis),⁶² Egypt's military has created and expanded a territorial buffer zone between Sinai and Gaza since late 2014.⁶³ More broadly over the past two years, significant deployments of manpower and weaponry, which have reportedly been approved by and coordinated with Israel pursuant to key provisions in the two countries' 1979 peace treaty, seem to have been part of larger Egyptian military efforts to counter militant Islamist and tribal groups in Sinai, perhaps including Palestinian militants.⁶⁴ Israel has actively sought continued U.S. and international support for Egypt since the July 2013 leadership change, and Egypt continues to play a key role in political mediation involving Israel, Hamas, and other Palestinian militants.

Major Israel-Hamas Conflicts Since 2008

Fatalities: More than 2,100 Palestinians, 71 Israelis (five civilians), and one foreign worker

Israel continues to face a rocket threat from the Gaza Strip/Sinai Peninsula (via Hamas and other militant groups) and Lebanon (via Hezbollah) that has expanded in geographical range in the past few years.⁶⁵ There has been little or no lasting progress in arresting the rocket threat or in negotiating an easing of Israel's perimeter of control in and around Gaza, though the replenishment of Palestinian militants' stocks from outside sources following the summer 2014 conflict has reportedly been slowed by Egypt's large-scale destruction of smuggling tunnels. Meanwhile, Israel continues to deploy and develop programs to defend against a wide variety of rockets and missiles.

The conflict that took place in Israel and Gaza over approximately 50 days in July and August 2014 was known by Israel's military as Operation Protective Edge/Mighty Cliff. The conflict ended with an Egyptian-mediated cease-fire on August 26. Under the terms of the cease-fire, Israel, Hamas, and the PA reportedly contemplated negotiating or working through mediators toward arrangements regarding security, commerce, and post-conflict reconstruction, though to date the status quo in and around Gaza has not significantly changed. Israel seeks assurances that Hamas cannot divert materials for reconstruction toward a reconstitution of the military infrastructure—including a network of tunnels both within Gaza and leading to Israel—it used during the summer conflict, while Hamas appears unwilling to cede meaningful control over security in Gaza to the PA. As Israel has eased a few aspects of the restrictions it maintains on the flow of people and goods into and out of Gaza, a number of media reports speculate that Israel and Hamas may be indirectly negotiating via Qatari officials toward a long-term ceasefire.⁶⁶

Both the House and Senate versions of the National Defense Authorization Act for 2016 (H.R. 1735 and S. 1376) include Armed Services Committees-approved language that would authorize the President to use U.S. funds to help Israel research, develop, establish, and maintain an anti-tunneling system if the executive branch and Israel formalize planned joint efforts—including cost-sharing and other key details—in a memorandum of understanding.

The summer 2014 conflict was the third major conflict between Israel and Hamas (along with other Palestinian militants) since the end of 2008, with previous conflicts occurring in December 2008-January 2009 and November 2012. Each arguably has featured mutual tests of military capability, domestic political cohesion, and deterrence in times of political change. Each of the three conflicts has also featured heated debate over respective culpability and the targeting or reckless endangerment of civilians.

Prospects of a negotiated settlement of the Israeli-Palestinian conflict in the foreseeable future seem dim. The most recent U.S.-backed round of peace talks ended unsuccessfully in April 2014 after differences between the parties on long-standing core issues of Israeli-Palestinian dispute were exacerbated by the parties' respective actions during the negotiating process.⁶⁷ Neither Israeli leaders, nor Palestinian leaders of the Fatah and Hamas factions that are preoccupied with maintaining their domestic credibility and respective aspects of control in the West Bank and the Gaza Strip, appear disposed to make substantive compromises. See "Peace Process Diplomacy" below for information and analysis on recent developments regarding the peace process.

Ongoing tensions appear to reflect risks inherent in periodically recurring incidents of violence and vandalism involving Israelis (including West Bank settlers) in close proximity to Palestinians. Israeli authorities face difficulty in the daily task of restraining and protecting Israelis from such potentially inflammatory encounters.⁶⁸ A number of "lone wolf" Palestinian attacks targeting Israelis have taken place in Jerusalem since late 2014⁶⁹ amid larger questions regarding the culpability of Israeli and Palestinian officials, private individuals, and communities in contributing to various incidents and the overall atmosphere in which the attacks occur.

In the absence of a return to Israeli-PLO negotiations, Israeli leaders could face domestic pressure to devise other possible ways to reduce their country's interactions with and responsibilities for West Bank Palestinians without compromising national security.⁷⁰ The resumption of Palestinian international initiatives after the breakdown of talks in the spring of 2014 (discussed below) may be intended at least partly to improve the Palestinians' position by encouraging U.S. and international political and economic pressure on Israel. Perhaps to some extent in anticipation that this pressure could increase, political figures from the Israeli left and center, as well as some commentators, continue to stress what they characterize as an urgent need for Israel to resolve its disputes with the Palestinians.

Some observers assert that Israeli leaders face a dilemma between democracy and demography,⁷¹ expressing concern that a "one-state reality" may be coalescing and becoming more entrenched absent a two-state solution. Past prime ministers, including Yitzhak Rabin and Ehud Olmert, claimed that coming to an arrangement with the Palestinians on the West Bank and Gaza would be necessary in order to avoid the situation of Jews ruling as a numerical minority over a numerical majority of Arabs in historic Palestine. The concerns they enunciated focus on the challenges of trying to maintain both democracy and Jewish primacy. Some demographers have disputed the data underlying these concerns.⁷²

During the July 2013-April 2014 negotiations, Netanyahu periodically made public reference to demographic concerns to explain his reasons for pursuing diplomacy. After the negotiations collapsed, Netanyahu appeared to consider the arguments some prominent Israelis were making⁷³ about the possibility of "unilateral disengagement" from the West Bank.⁷⁴ However, upon the outbreak of conflict in July 2014 with Hamas and other Palestinian militants in Gaza, Netanyahu said that "there cannot be a situation, under any agreement, in which we relinquish security control of the territory west of the River Jordan." ⁷⁵

Since then, Netanyahu's statements on the Palestinian issue appear to challenge the Palestinians and Arab states to change their approaches before Israel will consider making concessions. In his September 2014 speech before the U.N. General Assembly, he stated that a "broader rapprochement between Israel and the Arab world," perhaps facilitated by common concerns regarding "a nuclear-armed Iran and militant Islamist movements gaining ground in the Sunni world," may help facilitate an Israeli-Palestinian peace based on "mutual recognition and enduring security arrangements, rock solid security arrangements on the ground." Additionally, though Netanyahu's remarks before and after the March 2015 elections have fueled debate and uncertainty over whether he still supports or ever supported a "two-state solution," they have consistently indicated that Israel would only be willing to contemplate such a solution if the Abbas-led Palestinians recognize Israel as a Jewish state and curtail Hamas's role in governance. Although there have been some manifestations of Israeli-Arab common cause regarding Iran, Netanyahu's expectations appear to run counter to longtime Arab policies and popular sentiment rejecting formal recognition of Israel absent a number of steps addressing Palestinian territorial and political demands.

Other Israeli leaders have articulated possible alternative approaches. Naftali Bennett of Likud's coalition partner Ha'bayit Ha'Yehudi, who may be a rival to Netanyahu for future leadership of the political right and perhaps the country, openly calls for Israel to annex a majority of the West Bank's territory to ensure Israel's security, though he states that neither annexation or creation of a Palestinian state is likely in the near future.⁷⁶ Yitzhak Herzog of the Zionist Union, who leads Israel's opposition, expresses traditional Israeli center-left interests in engaging in a peace process to avoid a "one-state reality" and to maintain good relations with the United States and international community. However, he and others who support his approach have not clearly revealed how their positions on core issues of dispute might differ from Netanyahu's.⁷⁷

Israel and many of its supporters, along with the international media, frequently raise the possibility that Israel could become more "isolated" internationally.⁷⁸ Israel's willingness to show flexibility regarding its security practices, negotiating demands, or diplomatic tactics may depend on whether its leaders believe that changes in their policies can change attitudes toward them. Some Israelis argue or imply that efforts to isolate them are led by implacable enemies determined to spread anti-Israel and anti-Semitic attitudes, and thus bear little or no relationship to Israel's policies.⁷⁹ Other Israelis assert a more direct relationship between Israeli policies, such as the construction of Jewish communities or "settlements" (the term used most commonly internationally) in the West Bank and East Jerusalem, and international attitudes toward Israel. This latter set routinely laments what they characterize as uncompromising approaches by their leaders toward charged issues like the Israeli-Palestinian conflict.⁸⁰

Initiatives by Palestinian leaders in international fora have the potential to mobilize international sentiment in opposition to Israeli objectives. As Israeli-Palestinian peace talks faltered in early 2014, PLO Chairman Mahmoud Abbas renewed his focus on such initiatives, which he had earlier pursued in 2011 and 2012 (see "Peace Process Diplomacy" below). In April 2014, with the most recent round of U.S.-mediated Israeli-Palestinian negotiations on the verge of collapse, Abbas and the PLO sought to accede to a number of international treaties and conventions. This contributed to ensuring the talks' discontinuation. On December 30, 2014, a Palestinian-backed, U.S.-opposed U.N. Security Council draft resolution regarding some contentious Israeli-Palestinian issues garnered only eight of the required nine votes for adoption.⁸¹

Shortly after that, the Palestinians submitted letters of accession to additional international treaties and conventions, including the Rome Statute of the International Criminal Court (ICC).⁸² On January 16, 2015, the ICC Prosecutor announced a preliminary examination into the "situation in Palestine" to determine "whether there is a reasonable basis to proceed with an investigation" against Israelis, Palestinians, or others.⁸³ The announcement triggered vigorous Israeli opposition in response.⁸⁴ Palestinian leaders publicly anticipate providing information to the ICC on alleged Israeli crimes regarding both the summer 2014 Israel-Gaza conflict and settlement activity in the West Bank.

The international fallout for Israel over the summer 2014 conflict included allegations that Israel used disproportionate force in Gaza. The U.N. Human Rights Council (UNHRC) voted in July to establish a commission to investigate all possible violations of international humanitarian and human rights law in Gaza and the West Bank since June 13, 2014.⁸⁵ On July 29, 2014, the Senate passed S.Res. 526, which stated that the Senate

condemns the United Nations Human Rights Council's resolution on July 23, 2014, which calls for yet another prejudged investigation of Israel while making no mention of Hamas's continued assault against Israel, and also calls for an investigation into potential human rights violations by Israel in the current Gaza conflict without mentioning Hamas's assault against innocent civilians and its use of civilian shields.

Israel's government is not cooperating with the UNHRC-appointed commission,⁸⁶ whose report is expected to be released in June 2015.⁸⁷ However, Israel did cooperate with a board of inquiry established by U.N. Secretary-General Ban Ki-moon to investigate how various U.N. Relief and Works Agency for Palestine Refugees in the Near East (UNRWA) sites in Gaza may have been damaged by Israel militarily and used illicitly by Palestinian militants to store weapons. The board of inquiry submitted its report to Secretary-General Ban in February 2015, and on April 27, 2015, the Secretary-General's office transmitted a summary of the report to the U.N. Security Council. In an accompanying cover letter, Ban deplored that "at least 44 Palestinians were killed as a result of Israeli actions and at least 227 injured at United Nations premises being used as emergency shelters."⁸⁸ Ban also stated that it was unacceptable that Palestinian militant groups used some empty United Nations schools to "store their weaponry and, in two cases, probably to fire from," and that he was determined to ensure that no such incident recurs.

A "BDS" (boycott, divestment, and sanctions) movement against Israel—ostensibly linked to its treatment of Palestinians—has gained support among civil society organizations in a range of countries.⁸⁹ Some divestment from and boycotts of Israel or Israeli goods have resulted. For example, the American Studies Association, a scholarly organization devoted to the interdisciplinary study of American culture and history, voted for an academic boycott of Israeli institutions in December 2013, amplifying the controversy surrounding the issue with lawmakers and with U.S. higher education institutions and student councils.⁹⁰ Some who oppose BDS measures against companies in Israel because of concerns that the movement's demands could endanger Israel's identity as a Jewish state nevertheless support efforts to divest from Israeli companies doing business in West Bank settlements.⁹¹ Additionally, some European countries' pension funds and companies have withdrawn investments or canceled contracts owing to concerns regarding connections with settlement activity.⁹² An unsuccessful May 2015 Palestinian effort to suspend Israel from FIFA (soccer's global governing body) for alleged improper Israeli treatment of Palestinian athletes has led some Israelis to voice concern about possible future efforts to ban Israel from international sporting events and conferences.⁹³

Political Overview

Past statements indicate that the European Union (EU) may be willing to provide financial incentives and even an upgrade in ties to both Israel and the Palestinians in the event of a successful peace agreement.⁹⁷ Concerns about radicalization and acts of terror committed by European Muslims may intensify the sense of urgency among European leaders to address the Israeli-Palestinian conflict, the resolution of which many Europeans view as critical to mitigating Muslim grievances. France and possibly other European countries reportedly seek to propose a U.N. Security Council draft resolution setting forth basic parameters for Israeli-Palestinian peace negotiations, but uncertainty surrounds both the potential terms of the draft resolution and U.S. openness to it.

Possible Impact on Israel-Europe Economic Cooperation

In late April 2015, both the Senate Finance Committee and the House Ways and Means Committee unanimously approved amendments to the versions of the Bipartisan Congressional Trade Priorities and Accountability Act of 2015 (S. 995 and H.R. 1890) that they later respectively reported favorably for full Senate and House consideration. This bill would provide trade promotion authority to the President facilitating his ability to negotiate the major potential trade agreements known as the Trans Pacific Partnership (TPP) and Transatlantic Trade and Investment Partnership (T-TIP). The amendments added a trade negotiating objective for T-TIP (the agreement designed to facilitate trade between the United States and the EU) discouraging politically motivated economic actions "intended to penalize or otherwise limit commercial relations specifically with Israel or persons doing business in Israel or in Israeli-controlled territories." Public debate regarding the amendments has focused on whether EU measures or potential measures differentiating commerce with Israeli settlements from commerce with Israel constitute or promote BDS-related activities, and on the advisability of congressional initiatives that may either legitimize or delegitimize Israeli control in areas Israel occupied militarily in its 1967 war with various Arab countries.¹⁰⁹ The same amendment language is in the version of the bill (H.R. 1314) that was passed by the Senate on May 22, 2015, and is subject to consideration by the House.

Turkey

On May 14, 1948, the United States became the first country to extend de facto recognition to the state of Israel. Over the years, despite occasional policy differences, the United States and Israel have maintained close bilateral ties based on common democratic values, religious affinities, and security interests. Relations have evolved through legislation; memoranda of understanding; economic, scientific, and military agreements; and trade. Congress provides military assistance to Israel and has enacted other legislation in explicit support of its security. Many analysts view these forms of support as pillars of a regional security order—largely based on varying types and levels of U.S. arms sales to Israel and Arab countries—that have discouraged the outbreak of major Arab-Israeli interstate conflict for more than 40 years.¹¹⁵

Israeli officials closely monitor U.S. actions and consult with U.S. counterparts in apparent efforts to gauge and influence the nature and scope of future U.S. engagement on and commitment to regional issues that implicate Israel's security. In consequence of possible Israeli concerns about these issues and about potential changes in levels of U.S. interest and influence in the region, Israeli leaders and their supporters may actively try to persuade U.S. decision makers both that

• Israel's security and the broader stability of the region continue to be critically important for U.S. interests; and
• Israel has substantial and multifaceted worth as a U.S. ally beyond temporary geopolitical considerations and shared ideals and values.¹¹⁶

These efforts would seek to perpetuate and bolster the already strong popular and official U.S. commitment to Israel's security, in light of the following quotation from an unnamed former American Israel Public Affairs Committee (AIPAC) official: "[T]he U.S. has its own foreign policy, and, while it is extremely friendly to Israel, it will only go so far."¹¹⁷

Israel-sponsored efforts to emphasize its importance to the United States also may aim to minimize possible demands by U.S. policymakers for Israel to compensate the United States for bearing certain military, political, or economic costs as a result of supporting Israel amid regional challenges.¹¹⁸ Expectations among some U.S. officials could include greater Israeli deference to and coordination with the United States on regional diplomacy and military action. This could fuel or intensify U.S.-Israel disagreement over the type and level of support that the United States might provide to address threats Israel perceives, or how Israel might continue its traditional prerogative of "defending itself, by itself" while also receiving external assistance.

Aligning U.S. and Israeli policies has presented challenges on some key matters of concern. Many reports indicate that President Obama and Prime Minister Netanyahu have differed on a number of issues, especially relating to Iran's nuclear program and to the Palestinians, since they both took office in 2009. Some instances have occurred in which officials from the two countries have criticized policies or actions by their bilateral counterparts. Mutual criticism in the past year-plus has surfaced in association with the unsuccessful end of the latest round of Israeli-Palestinian talks in April 2014, the Israel-Gaza conflict in the summer of 2014 (including U.S. attempts to broker a cease-fire), announcements by Israel related to Jewish settlements or communities in the West Bank and East Jerusalem,¹¹⁹ Netanyahu's actions and comments in relation to Iran and the Palestinians during the March 2015 Israeli electoral campaign, and the political framework for a P5+1-Iran nuclear agreement that emerged in early April.

Observers debate how deep-seated and long-lasting various U.S.-Israel differences might be, and whether U.S. policy questions regarding support for Israel might increasingly be contested along partisan lines.¹²⁰ Israeli leaders appear to have some concerns about the U.S. commitment to regional issues implicating Israel's security, but at the same time overall bilateral cooperation has continued and even increased by many measures on a number of issues such as defense, trade, and energy.

Shortly after Netanyahu's March 2015 electoral victory, President Obama spoke of the countries' "deep and abiding partnership" in a congratulatory call. However, in a subsequent media interview, Obama said he had also indicated to Netanyahu in their call that Netanyahu's election day comment that Arab Israelis were going to the polls "in droves"—an apparent attempt to get greater turnout from his base of Jewish Israeli voters—was "contrary to what is the best of Israel's traditions" of democracy, equality, and fairness.¹²¹ Netanyahu later publicly apologized for the comment. In the same interview, Obama seemed unconvinced by Netanyahu's post-election insistence that his pre-election remarks had not fundamentally changed his stance on a two-state solution:

We take him at his word when he said that it [the creation of a Palestinian state] wouldn't happen during his prime ministership, and so that's why we've got to evaluate what other options are available to make sure that we don't see a chaotic situation in the region.¹²²

Following the March election, reports cited unnamed Administration officials as indicating that the United States might consider departing from its usual willingness to veto U.N. Security Council draft resolutions objectionable to Israel were a new resolution on Israeli-Palestinian negotiating parameters to come to a vote.¹²³ These reports have triggered public debate over the issue, with some Members of Congress encouraging continued U.S. support for Israel in international fora, reparation of any damage to the bilateral relationship, and a more private approach to expressing differences of opinion.¹²⁴ Deputy Secretary of State Tony Blinken appeared to deny the reports' validity in March 19, 2015, testimony before the House Foreign Affairs Committee.¹²⁵ In an April 15, 2015, hearing before the House Appropriations Subcommittee on State, Foreign Operations, and Related Programs, Ranking Member Nita Lowey asked Permanent Representative to the United Nations Samantha Power, "Is it still the position of the administration to veto one-sided anti-Israel resolutions at the U.N.?" Without giving an unequivocal answer, Power referred to her "no" vote on the December 2014 draft resolution discussed above (see "International Political and Legal Initiatives"), along with other U.S. actions at the United Nations in support of Israel. Then she said that "we will look to see what will advance Israel's security and what will advance peace in the region. And stand, again, consistently for Israel's legitimacy and security."¹²⁶ In late April, Under Secretary of State for Political Affairs Wendy Sherman said, "If the new Israeli government is seen as stepping back from its commitment to a two-state solution ... that makes our job in the international arena a lot tougher."¹²⁷

Strong bilateral relations have fueled and reinforced significant U.S.-Israel cooperation on defense, including military aid, arms sales, joint exercises, and information sharing. It has also included periodic U.S.-Israel governmental and industrial cooperation in developing military technology.

U.S. military aid has helped transform Israel's armed forces into one of the most technologically sophisticated militaries in the world. This aid for Israel has been designed to maintain Israel's "qualitative military edge" (QME) over neighboring militaries, since Israel must rely on better equipment and training to compensate for a manpower deficit in any potential regional conflict. U.S. military aid, a portion of which may be spent on procurement from Israeli defense companies, also has helped Israel build a domestic defense industry, and Israel in turn ranks as one of the top 10 exporters of arms worldwide.

On November 30, 1981, the United States and Israel signed a memorandum of understanding (MOU) establishing a framework for consultation and cooperation to enhance the national security of both countries. In 1983, the two sides formed a Joint Political Military Group (JPMG) to implement provisions of the MOU. Joint air and sea military exercises began in 1984, and the United States has constructed facilities to stockpile military equipment in Israel. In 1987, Israel was designated a "major non-NATO ally" by the Reagan Administration, and in 1996, under the terms of Section 517 of the Foreign Assistance Act of 1961, as amended, Congress codified this status, affording Israel preferential treatment in bidding for U.S. defense contracts and expanding its access to weapons systems at lower prices. In 2001, an annual interagency strategic dialogue, including representatives of diplomatic, defense, and intelligence establishments, was created to discuss long-term issues. This dialogue was halted in 2003 over bilateral tensions related to Israeli arms sales to China (see "Israeli Arms Sales to Other Countries" below), but resumed in 2005.

On May 6, 1986, Israel and the United States signed an MOU—the contents of which are classified—for Israeli participation in the Strategic Defense Initiative (SDI/"Star Wars"), under which U.S.-Israel co-development of the Arrow ballistic missile defense system has proceeded, as discussed below. In 1998, another U.S.-Israel MOU referred to growing regional threats from ballistic missiles. This MOU said that "In the event of such a threat, the United States Government would consult promptly with the Government of Israel with respect to what support, diplomatic or otherwise, or assistance, it can lend to Israel."

As of mid-2015, with the United States offering to sell Arab Gulf states more and perhaps more advanced weapons in response to regional concerns about a possible international agreement on Iran's nuclear program, reports indicate that Israel has not voiced objections. This may be because the Administration is reportedly not offering the Gulf states certain high-performance items that Israel has purchased or plans to purchase, such as F-35 aircraft or GBU-28 bunker buster munitions.¹³⁵ Moreover, Israeli officials may calculate that U.S. sales to Gulf states work to their advantage by effectively requiring that Israel receive more advanced equipment as a result because of QME requirements.¹³⁶ It is unclear whether possible coordination between Arab militaries in places such as Syria, Yemen, or Libya might change Israeli threat perceptions over time. In February 2015, the members of the Senate Armed Services Committee sent letters to the Secretaries of Defense and State acknowledging the U.S. commitment to Israel's QME while urging them to expeditiously address Jordanian requests for arms and equipment related to coalition efforts against the Islamic State organization.¹³⁷

Absent legislative clarification, the legality of future U.S. arms sales to various Arab aid recipients, partners, or allies—including Egypt, Saudi Arabia, Jordan, Lebanon, and Iraq—could become increasingly subject to challenge both by Israeli officials feeling heightened sensitivity to regional threats and by sympathetic U.S. policymakers.

(historical $ in millions)

Year

Total

Military Grant

Economic Grant

Immig. Grant

ASHA

All other

1949-1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

—

—

2009

—

—

2010

—

—

2011

—

—

2012

—

—

2013

2.793.2

—

—

2014

—

—

2015

—

—

2016 Request

—

—

Total

76,723.4

30,897.0

1,708.2

162.075

14,991.9

Fiscal Year

Arrow II

Arrow III (High Altitude)

David's Sling (Short-Range)

Iron Dome

Total

FY2006

122.866

—

10.000

—

132.866

FY2007

117.494

—

20.400

—

137.894

FY2008

98.572

20.000

37.000

—

155.572

FY2009

74.342

30.000

72.895

—

177.237

FY2010

72.306

50.036

80.092

—

202.434

FY2011

66.427

58.966

84.722

205.000

415.115

FY2012

58.955

66.220

110.525

305.700

40.800

74.700

137.500

194.000

479.736

FY2014

44.363

74.707

149.712

460.309

729.091

FY2015

56.201

74.707

137.934

350.972

619.814

11.000

55.100

36.700

55.000

157.800

For historical background on these issues, see CRS Report RL34074, The Palestinians: Background and U.S. Relations, by [author name scrubbed].

Overview

The internationally mandated land-for-peace framework that has undergirded U.S. policy since the June 1967 Arab-Israeli war presupposes broad Arab acceptance of any final-status Israeli-Palestinian agreement, and, more fundamentally, Arab acceptance of Israel. Israelis insist that their security needs must be met for them to be willing to relinquish West Bank land in a negotiated two-state solution with the Palestinians. However, in light of Arab political change since 2011, Israeli leaders appear to have become concerned that they might be less able to count on future positive ties even with states such as Egypt and Jordan, given uncertainty regarding the mid- to long-term stability of their regimes.¹⁵⁰ This assessment has likely led Israel to perceive greater risks in a potential land-for-peace deal, perhaps due to a calculation that continued possession of territory may be a more reliable guarantor of security than an agreement with one or more Arab entities.

The United States, together with the other members of the international Quartet (the European Union, the United Nations Secretary-General's office, and Russia), continues to advocate for Israeli-Palestinian talks aimed at a peace deal under the framework initially established by the Oslo agreements of the 1990s. During the first two years of President Obama's and Prime Minister Netanyahu's time in office, attempts by the United States to get Israel to freeze settlement construction beyond the 1949-1967 armistice line (known as the "Green Line") were only partially successful (see "Settlements" below) and did not lead to a meaningful resumption of negotiations.¹⁵²

During the next two years, PLO Chairman Mahmoud Abbas opted to pursue initiatives outside of the negotiating process at the United Nations and U.N.-related agencies. These initiatives were aimed at increasing the international legitimacy of Palestinian claims of statehood in the West Bank and Gaza. On November 29, 2012, the U.N. General Assembly (UNGA) adopted Resolution 67/19, changing the permanent observer status of the PLO (recognized as "Palestine" within the U.N. system) from an "entity" to a "nonmember state."¹⁵³ This took place a year after the PLO gained admission in November 2011 to the U.N. Educational, Scientific and Cultural Organization (UNESCO).¹⁵⁴ As discussed above, Abbas has resumed international initiatives—including some relating to the ICC (see "International Political and Legal Initiatives " above)—following a round of U.S.-brokered Israeli-Palestinian negotiations that began in July 2013 and unraveled in the spring of 2014. These initiatives may be intended at least partly to improve the Palestinians' negotiating position by placing political and economic pressure on Israel.

Outstanding Issues

Media reports from the 2013-2014 negotiations and their demise indicated that substantive differences divided Israelis and Palestinians on core issues of dispute. Abbas was reportedly unwilling to explicitly recognize Israel as "the nation-state of the Jewish people" because of the potential repercussions for Palestinian refugees' claim to a right of return and for Israeli Arabs' rights.¹⁵⁵ Other Arab foreign ministers reportedly informed Secretary of State John Kerry that they would "not accept Israel as a Jewish state nor compromise on Palestinian sovereignty in Jerusalem."¹⁵⁶ Prime Minister Netanyahu repeatedly raised the issue of Jewish refugees from predominantly Muslim Middle Eastern countries.¹⁵⁷

Additionally, despite efforts in 2013 by Kerry and a team of U.S. experts headed by retired Marine General John R. Allen to bridge the divide between the two sides on security arrangements in the Jordan Valley border area of the West Bank, reports asserted that neither side embraced the proposals. The PLO has rejected an indefinite Israeli military presence within what they assert would be sovereign Palestinian territory,¹⁵⁸ while Israel communicated unwillingness to phase out its presence¹⁵⁹—largely owing to recent historical instances in which Israeli military withdrawal from southern Lebanon (2000) and the Gaza Strip (2005) led to the entrenchment of adversarial Islamist militants armed with rockets that have hit Israeli population centers and remain capable of doing so.

Contention has persisted between the parties over possible land swaps and mutual allegations of incitement and provocation.¹⁶⁰ During the March 2015 Israeli election campaign, a document was apparently leaked to the media purporting to show a willingness by Netanyahu in late 2013 to engage in land swaps based on pre-1967 armistice lines, and to be flexible on other issues (such as Palestinian refugees and Jerusalem).¹⁶¹ It is unclear whether the document reflected Netanyahu's positions of that time.¹⁶² In May 2015, Netanyahu's proposal to negotiate the boundaries of settlement blocs to eventually be annexed by Israel was quickly rebuffed by the PLO. The proposal may have been at least partly motivated by an Israeli desire to project good faith efforts toward diplomacy and to legitimize construction activities within settlement blocs in a way that might ease the international—and particularly European—political and economic pressure Israel faces.¹⁶³

The Path Ahead

A number of questions surround the future of the Israeli-Palestinian peace process, including

• How will recent conflict, diplomatic confrontation, and ongoing tensions among Israelis and Palestinians affect prospects for future negotiations and a two-state solution?
• Can the PA government formed in June 2014 via consensus between Fatah and Hamas last,¹⁶⁴ and if it does, can it help the PLO become a more credible representative of its Palestinian constituency with Israel and other international actors?
• Will the United States put forward parameters or a framework on core issues of conflict meant to advance the process, and if so, when? How will the United States address unilateral efforts by Israelis and Palestinians, as well as efforts by international actors or organizations, to affect political and security-related outcomes?

France is reportedly preparing a U.N. Security Council (UNSC) draft resolution that it would supposedly submit for a vote in September 2015. The success of such a resolution would be dependent on U.S. acquiescence (see "Recent Differences Among Leaders and on Key Issues" above), among other factors. The projected timing appears to be largely based on a calculation expressed by a former Obama Administration official that "for the next few months at least, while trying to sell Congress on a nuclear deal with Iran that Israel vigorously opposes, the administration is unlikely to open a second front in New York [through acquiescence to or support for a UNSC resolution on Israeli-Palestinian issues]."¹⁶⁵ A French draft resolution apparently calls for¹⁶⁶

• negotiation of a permanent Israeli-Palestinian agreement within 18 months that embodies the principle of "two states for two nations";
• pre-1967 armistice lines as reference points for border negotiations;
• a system guaranteeing the security of both Israel and the Palestinians while providing for a negotiated, phased withdrawal of Israeli forces from a future Palestinian state;
• a "balanced and realistic" solution regarding Palestinian refugees; and
• Jerusalem as the capital of both states.

It is unclear whether the United States would countenance a resolution that does not explicitly characterize Israel as a Jewish state or call upon the Palestinians to do so.

Another former U.S. official signals that Administration officials may have relatively modest expectations for the near future, focused on getting Israel to agree to a package of incremental steps—such as limits on Jewish settlement construction and increased Palestinian economic access to West Bank land—that preserve the "viability of future two-state negotiations."¹⁶⁷ In the meantime, U.S. efforts to prevent or mitigate crises could depend largely on continued Israel-PA West Bank security cooperation¹⁶⁸ and the PA's ability to continue paying its employees' salaries.

In a May 2015 interview, President Obama emphasized the importance of "rebuilding trust" while expressing skepticism that an overarching deal can be reached in the next year, based on his observations regarding the makeup of the Netanyahu government and the challenges that Abbas faces.¹⁶⁹ Obama said that if progress takes place with post-conflict recovery in Gaza and Palestinian economic development, he believes that "the logic of a two-state solution will reassert itself."¹⁷⁰

Israel annexed East Jerusalem (which includes the walled Old City, with its Temple Mount/Haram al Sharif ["Mount/Haram"] and Western Wall, and most of the surrounding "historic basin") and some of its immediate West Bank vicinity in 1967—shortly after occupying these areas militarily in the June 1967 Arab-Israeli war. In doing so, Israel joined these newly occupied areas,¹⁷¹ which featured a predominantly Arab population, to the predominantly Jewish western part of the city it had controlled since 1948. Israel proclaimed this entire area to be Israel's eternal, undivided capital.¹⁷² Polls indicate that a large majority of Israelis believe that a united Jerusalem is their capital and support Jewish residential construction of neighborhoods (the Israeli term) or settlements (the general internationally used term) within that part of Jerusalem that is east of the Green Line and within the Israeli-drawn municipal borders. Israel's annexation of areas beyond the Green Line is generally not internationally recognized.

Note: All locations and lines are approximate.

Note: All locations and lines are approximate.

• 1. influence over key voting blocs in Israel's coalition-based parliamentary system (although they do not all share the same ideology or interests, settlers constitute about 6% of the Israeli population);
• 2. renegade actions to foment public protest and even violence; and
• 3. what they represent for some symbolically, emotionally, and even spiritually as guardians of the last frontier for a country whose founding and initial survival depended on pioneering spirit in the face of adversity.

It is unclear whether a future arrangement creating a Palestinian state might compel the tens of thousands of Jewish settlers who would likely live within the new state's borders to relocate inside Israel, or whether these settlers might have the option to remain, perhaps as "resident aliens." According to one former U.S. official, "Security arrangements for Israelis who voluntarily choose to live in a Palestinian state rather than move back to Israel would be immensely complicated, and in many eyes impossible. But the same can be said about any plan that would force tens of thousands of them [to] leave their homes."¹⁹⁹

Various Israeli governments' periodic announcements of new plans for settlement construction, possible consideration of legalizing some settlement outposts, approval of subsidies and loans for some settlers, and repeated insistence that outside actors will not dictate Israeli policy on this subject appears to demonstrate the governments' sensitivity to these domestic concerns. The Israeli anti-settlement advocacy group Peace Now reported in February 2015 that there was a nearly 40% increase in construction starts on residential units in West Bank settlements during the 16-month period (June 2013-September 2014) following the previous 15-month period (March 2012-May 2013), and that 26% of these starts took place in areas east of the route of the separation barrier.²⁰⁰ Observers debate the extent to which Israeli settlement construction under Netanyahu is changing or seeks to change demographic realities in areas of presumed importance for border and peace negotiations—including on and around the margins of settlement blocs that Israel insists on keeping under any final-status agreement.²⁰¹

Some Israelis caution that the demand to provide security to settlers and their infrastructure and transportation links to Israel could perpetuate Israeli military control in the West Bank even if other rationales for maintaining such control eventually recede. Protecting settlers is made more difficult and manpower-intensive by some settlers' altercations with Palestinian West Bank residents and willingness to defy Israeli military authorities. The government complied in 2012 with rulings by Israel's Supreme Court requiring it to dismantle two outposts. It sought to placate settler opposition to dismantlement by relocating the displaced outpost residents within the boundaries of settlements permitted under Israeli law.²⁰²

Arms sales, information sharing, and co-development of technology between the United States and Israel raises questions about what Israel might do with capabilities or information it acquires. The sale of U.S. defense articles or services to Israel and all other foreign countries is authorized subject to the provisions of the Arms Export Control Act (AECA) (see §40A of P.L. 90-629, as amended)²⁰³ and the regulations promulgated to implement it. Section 3 of the AECA stipulates that in order to remain eligible to purchase U.S. defense articles, training, and services, foreign governments must agree not to use purchased items and/or training for purposes other than those permitted by the act, or to transfer them to third-party countries (except under certain specifically enunciated conditions), without the prior consent of the President.

The most prominent espionage case is that of Jonathan Pollard, who pled guilty in 1986 with his then wife Anne to selling classified documents to Israel. Israel granted Pollard—who is serving a life sentence in U.S. federal prison—citizenship in 1996 and, in 1998, acknowledged that Pollard had been its agent. Prime Minister Netanyahu and several of his predecessors have unsuccessfully petitioned various Presidents to pardon Pollard.²¹⁵ In April 2014, some reports indicated that the United States might be willing to release Pollard as part of an arrangement to extend or restart Israeli-Palestinian talks. The prospect of Pollard's release under these circumstances generated mixed reactions from Members of Congress, including opposition from the chairs of both intelligence committees, among strong views on the case within U.S. government circles and society at large.²¹⁶

Consensus among media and expert reports is that Israel possesses an arsenal of 80 to 200 nuclear weapons.²¹⁸ The United States has countenanced Israel's nuclear ambiguity since 1969, when Israeli Prime Minister Golda Meir and U.S. President Richard Nixon reportedly reached an accord whereby both sides agreed never to acknowledge Israel's nuclear arsenal in public.²¹⁹

Israel's ambiguous nuclear status is viewed by some members of the international community as an obstacle to advancing nonproliferation objectives. The 1995 Nonproliferation Treaty (NPT) Review Conference adopted a resolution that called for "all States in the Middle East to take practical steps" toward establishing "an effectively verifiable Middle East zone free of weapons of mass destruction, nuclear, chemical and biological, and their delivery systems." The Obama Administration has stated its support for the goal of a nuclear-weapon-free zone in the Middle East. Israel is not an NPT state, nor has it ratified the Chemical Weapons Convention (CWC), though it signed the CWC in 1993.

Recent events concerning Iran and Syria have re-focused international attention on Israel's presumed but undeclared nuclear and chemical weapons arsenals.²²⁰ It is unclear how Israeli leaders might feel compelled to change the country's proclaimed status or actual posture if they perceive either threats from Iran and/or other regional states to Israel's presumed regional nuclear exclusivity, or growing international pressure on the nonproliferation front.

Perhaps because the Iranian nuclear issue has given Israel a greater sense of common cause with Arab states, Israeli officials reportedly met in 2013 and 2014 with officials from Arab states for consultations regarding a regional nuclear-weapon-free zone. The consultations reportedly deadlocked over whether Arab-Israeli peace or disarmament should take precedence.²²¹ Israel participated as an observer in the April-May 2015 NPT review conference—the first time it has done so. At the conference, an Egyptian-sponsored draft statement proposing an early 2016 U.N. conference on a weapons of mass destruction (WMD)-free zone in the Middle East was reportedly blocked by the United States, the United Kingdom, and Canada largely due to Israel's objections that the statement did not appear to contemplate having such a conference address the WMD issue in the context of broader security concerns.²²²

Selected groups actively interested in Israel and the peace process are noted below with links to their websites for information on their policy positions.

COALITION

OPPOSITION

In 2010, the U.S. Geological Survey estimated that there are considerable undiscovered oil and gas resources that may be technically recoverable in the Levant Basin, an area that encompasses coastal areas of Israel, Syria, Lebanon, Gaza, and Egypt and adjacent offshore waters.²²⁸ Natural gas production from Israel's first major offshore field, Tamar, began flowing in March 2013, ushering in a new era of Israel as an energy producer and possibly an exporter. With a second, larger offshore natural gas field, Leviathan,²²⁹ still under development, Israel is facing questions of how best to utilize its natural gas resources, while other regional countries explore for resources in their jurisdictions.

Source: U.S. Department of State, Bureau of Intelligence and Research, Office of the Geographer, Geographic Information Unit.

Notes: Boundaries and locations are approximate and not necessarily authoritative.

It is too early to know the rate of natural gas recovery from all the new fields or if additional discoveries will be made, but Israel's energy consumption mix appears to be moving toward more natural gas. Israel has approximately 44 years-worth of natural gas reserves at its current consumption rate. In 2013, Israel produced 4.55 billion cubic meters (bcm) of natural gas, the country's highest amount ever, and more than triple the previous year. However, Israel still had to import 0.55 bcm of natural gas to meet its consumption of 5.10 bcm (approximately 180.1 billion cubic feet, or bcf).²³⁰ According to the website of Noble Energy,²³¹ the U.S.-based company that has conducted exploration and production (E&P) operations on behalf of the consortiums controlling both Leviathan and Tamar, assuming that Leviathan commences production in late 2017 or early 2018, "total deliverability is anticipated to be more than 3.5 Bcf per day (2 Bcf/d from Tamar and 1.6 Bcf/d from Leviathan)."

2013 vs. 2012

Source: BP Statistical Review of World Energy, 2014.

Notes: The percentage figures in parentheses represent changes between 2012 and 2013 figures. The percentage figures outside parentheses represent the 2013 figures. In 2013, Israel's total primary energy consumption was 24.2 million tonnes of oil equivalent (mtoe), compared with 24.8 mtoe in 2012.

2005–2013 (in billion cubic meters)

Source: Cedigaz, Statistical Database, accessed on February 23, 2015.

Note: Production plus imports equals consumption, given that Israel does not presently export natural gas.

If the resource estimates are correct, the new fields would give Israel the resources to become an exporter. Future export options include sending natural gas by pipeline and/or producing liquefied natural gas (LNG) that can be exported more broadly by ship. However, a number of factors raise questions about the viability of large-scale exports: growing domestic demand (possibly driven by new uses for natural gas), the expense of liquefying natural gas for transport, competitive projects in other countries, and various domestic and international political factors.

An antitrust dispute has disrupted plans for production of the Leviathan field. Israel's Antitrust Authority, an independent regulatory body, announced in December 2014 that a consent decree for the development of Leviathan would not be approved—despite previous indications that it would—because of concerns regarding monopolistic effects on Israel's energy market. Apparently concerned about possible adverse effects for Israel's economy and for export deals involving some of Israel's neighbors if development of Leviathan is delayed (see discussion of these deals or potential deals below), Israel's government established a committee headed by National Economic Council chairman Eugene Kandel in hopes of resolving the dispute. In May 2015, the committee reportedly proposed a multifaceted solution under which Delek (an Israel-based partner of Noble Energy) and Noble would retain their ownership of Leviathan, while Delek would divest from Tamar and Noble would dilute its Tamar holdings from 36% to 25%. The Antitrust Authority reportedly opposes this proposal, but under Israeli law, the economy minister could bypass the authority's objections by granting an exemption for national security reasons.²³² In late May, the head of the authority, David Gilo, announced his imminent resignation. Subsequently, Prime Minister Netanyahu was quoted as saying the following during a cabinet meeting:

We'll act on the basis of thoughtful consideration that balances competition with affordability, while extracting the gas from the sea floor. There is a blueprint for action that is a result of strenuous work done by various experts in the field. There was no consensus, and regrettably the anti-trust commissioner dissented, but we are going forward. I won't let any consideration, pressure or populist moves prevent the flow of gas to the State of Israel.²³³

Israeli officials routinely express optimism that the economic promise of Israel's energy resources can attract the industrial help it needs to be realized, and this optimism may prove justified. However, given that Israel does not have a significant offshore E&P sector, it relies on the expertise of international companies. The obstacles posed by antitrust deliberations, along with other apparent energy industry concerns about Israel's regulatory regime pertaining to domestic consumption requirements²³⁴ and possible price ceilings could create difficulties for future development.²³⁵ In May 2014, Woodside Petroleum, an Australia-based company with specialized expertise in LNG, opted not to join the venture to develop the Leviathan field.²³⁶

Possible Israeli Export Destinations and Regional Security and Political Implications

According to Noble Energy's CEO, the emergence of regional markets accessible by pipeline "has pushed the need for LNG into a later phase of development versus our earlier plans."²³⁷

There are a number of possible export destinations for Israeli natural gas via pipeline. However, questions exist regarding Israel's ability to create and sustain energy ties with Arab and other Muslim-majority neighbors whose relations with Israel are marked by ongoing or intermittent political disputes and/or sensitivities based on strong, long-standing anti-Israel public sentiment. It is unclear to what extent political difficulties with neighbors might be mitigated by the potential material benefits of energy cooperation or by other considerations, and how satisfactory logistical and transportation frameworks and security measures might be implemented. Israeli officials may be seeking a resolution to the ongoing antitrust dispute that would maintain a prominent role for Noble Energy in projects linked with export deals involving Arab countries. This may be partly due to Israel's dependence on international E&P expertise, and partly due to calculations that a U.S.-based company's involvement might make the deals less vulnerable to anti-Israel populism.

In addition to these overarching issues, the most-discussed potential export destinations each come with specific political considerations, as described below:²³⁸

Israel-Lebanon Maritime Boundary Disagreement and Its Implications²⁵⁴

In addition to the overarching regional political and security issues discussed above that may affect prospects for producing and exporting natural gas,²⁵⁵ another complication to energy development activities in the Eastern Mediterranean is Israel's disagreement with Lebanon over how to demarcate the maritime boundary between the two countries. This disagreement also has hampered Lebanon's efforts to develop potential offshore energy resources.

In seeking to help Israel and Lebanon resolve their differences on this question, the United States appears to be interested in facilitating a more hospitable commercial environment for all parties involved (including U.S. energy companies), and in preventing the dispute from exacerbating long-standing animosities between the two countries. It is unclear to what extent U.S. diplomacy on this issue can facilitate changes in the current Israeli and Lebanese stances.

For more information, see CRS Report R42816, Lebanon: Background and U.S. Policy, by [author name scrubbed].

Author Contact Information

Footnotes

CRS Report RL34074, The Palestinians: Background and U.S. Relations, by [author name scrubbed].

For a figure showing the various strains in Israeli politics over time, see a table in "The evolution of Israeli politics," economist.com, March 15, 2015.

Haim Malka, Crossroads: The Future of the U.S.-Israel Strategic Partnership, Washington, DC: Center for Strategic and International Studies, 2011, p. 19.

Most of these Russian-speaking emigrants are Ashkenazi and tend to be secular, but are generally more sympathetic with right-leaning parties than with the old Ashkenazi elite. Now that post-Soviet emigration flows have largely ended, growth in the Russian-speaking population of Israel has slowed and the overall demographic trend may now be one of decline or approaching decline.

Military service remains compulsory for most Jewish Israeli young men and women, and most Jewish Israeli men remain on reserve duty until the age of 40 (for soldiers) or 45 (for officers).

For a profile of Rivlin, see "Profile: Israel's President-elect Reuven Rivlin," BBC News, June 10, 2014.

Much of the information for this textbox comes from Israel's Ministry of Foreign Affairs website, "Elections in Israel–February 2009," February 10, 2009. See also "A beginner's guide to Israel's elections," Ynetnews, February 5, 2015; Ruth Levush, "FALQs: Israel's Upcoming 2015 General Elections," Law Library of Congress, March 2, 2015.

For additional details on Israel's campaign finance laws, see Ruth Levush, "Campaign Finance: Israel," Law Library of Congress, July 25, 2012.

The law was reportedly intended to counter Israeli military officers' cultivation of civilian political connections and influence in anticipation of their possible career transitions.

According to one media report, "Under Israeli law, war must be approved by the full cabinet. But the security cabinet, whose secrecy is better enforced, can green-light more limited military 'missions'. Making that distinction depends on whether Israel's intelligence chiefs anticipate an escalation into protracted conflict." Dan Williams, "Netanyahu's new security cabinet may hesitate on any Iran war," Reuters, March 19, 2013. Historically, Israeli prime ministers (including Netanyahu) have appeared to prefer convening the smaller forum for consultative purposes when convening the larger one is not legally required. See, e.g., Eli Lake, "Meet the Israeli 'Octet' That Would Decide an Iran Attack," Daily Beast, March 9, 2012. For a primer on and historical overview of Israel's national security decision making process by a former Israeli security official, see Charles D. Freilich, Zion's Dilemmas: How Israel Makes National Security Policy, Ithaca, New York: Cornell University, 2012. For a more concise version of the same subject matter, see Charles D. Freilich, "National Security Decision-Making in Israel: Improving the Process," Middle East Journal, vol. 67, no. 2, spring 2013.

Toby Greene, "Opinion: How Netanyahu did it again," Jewish News Online (UK), March 18, 2015.

See subtitled Hebrew-language video interview clip originally from Israel's NRG news outlet at http://www.nytimes.com/video/world/middleeast/100000003575164/netanyahu-rules-out-palestinian-state.html.

In June 2009, Netanyahu gave a speech at Bar-Ilan University near Tel Aviv that contemplated the possibility of a demilitarized Palestinian state if the Palestinians recognized Israel as the state of the Jewish people and if Israel's security needs were guaranteed (http://www.pmo.gov.il/English/MediaCenter/Speeches/Pages/speechbarilan140609.aspx).

Jodi Rudoren and Michael D. Shear, "Israeli Leader Backs Off Stand on 2-State Option," New York Times, March 20, 2015.

However, the coalition might prove more durable than some observers assert, partly owing to a 2014 bill that increases the difficulty for governments in Israel to be toppled by a no-confidence vote. Neri Zilber, "Benjamin Netanyahu's Grade A Pork-Barrel Politics," foreignpolicy.com, May 26, 2015.

In addition to becoming finance minister, Kahlon heads the Israel Land Authority (transferred from the housing ministry) and the Planning Administration (transferred from the interior ministry), and his party also controls the housing and environment ministries and the Knesset's welfare committee.

J.J. Goldberg, "Bibi's Nightmare: Unruly Coalition Might Fall—or Worse, Survive," Jewish Daily Forward, May 7, 2015.

Shas also leads the religious affairs ministry, and UTJ leads the Knesset's finance and interior committees.

Nathan Guttman, "7 Things About Benjamin Netanyahu's New Cabinet," Jewish Daily Forward, May 7, 2015.

Much of the information in this textbox comes from Allyn Fisher-Ilan, "FACTBOX-Legislative plans under Netanyahu's coalition government," Reuters, May 8, 2015.

Guttman, op. cit.

Shaked, a secular politician who began her career as a software engineer, once worked with Naftali Bennett on Netanyahu's staff (during Netanyahu's time as opposition leader) from 2006-2008, and later worked with Bennett to establish the right-leaning Israeli social movement My Israel. She joined the Bennett-led Ha'bayit Ha'Yehudi list for the 2013 national elections, and has gained notoriety for her outspoken nationalistic views. For more on Shaked and her views, see Jodi Rudoren, "A Fast Riser on Israel's Far Right Learns to Shrug Off Her Critics," New York Times, May 16, 2015; Open Source Center Media Note, "Israel: Profiles of Jewish Home MKs Naftali Bennett, Uri Ari'el, Ayelet Shaqed," LIL2015051261896016, May 12, 2015.

Jonathan Lis, "Netanyahu assumes veto power over potential Knesset legislation," haaretz.com, May 31, 2015.

"Netanyahu's new majority: Wafer thin," Economist, May 9, 2015; Zilber, op. cit.

IMF World Economic Outlook database, April 2015.

Ibid.

Economist Intelligence Unit, Country Report: Israel, generated May 27, 2015.

"How Netanyahu Went from Idealism to Pragmatism on Economic Policy," Knowledge@Wharton Blog, October 10, 2012.

OECD, In It Together: Why Less Inequality Benefits All, 2015, p. 20.

OECD, Economic Policy Reforms 2015: Going for Growth, pp. 223-226.

William Booth, "With Golan fence, Israel closer to surrounding itself with barriers," Washington Post, June 6, 2013; Sharona Schwartz, "Does a Border Fence Work? Check Out the Dramatic Change After Israel Put One Up," The Blaze, November 11, 2013. A proposed fence at Israel's border with Jordan is in the planning and budgeting stages, but given other military and domestic priorities, may take years to complete. Attila Somfalvi, "Can Israel afford Netanyahu's plan for massive border fence with Jordan?," Ynetnews, June 30, 2014; Yossi Melman, "A shared threat," Jerusalem Report, April 6, 2015.

Israel is not a party to the Nuclear Nonproliferation Treaty (NPT) and maintains a policy of "nuclear opacity" or amimut. A consensus among media and analysts' reports is that Israel possesses an arsenal of 80 to 200 nuclear weapons. See, e.g., Timothy McDonnell, "Nuclear pursuits: Non-P-5 nuclear-armed states, 2013," Bulletin of the Atomic Scientists, vol. 69(1), 2013.

Israeli Prime Minister's website, transcript of Netanyahu's remarks at the Jewish Federations of North America's General Assembly, November 11, 2014.

For background information on Iran and its nuclear program, see CRS Report RL32048, Iran, Gulf Security, and U.S. Policy, by [author name scrubbed]; CRS Report R43333, Iran Nuclear Agreement, by [author name scrubbed] and [author name scrubbed]; and archived CRS Report R42443, Israel: Possible Military Strike Against Iran's Nuclear Facilities, coordinated by [author name scrubbed].

A nuclear weapons capability below the threshold of actual weapons production would entail an ability to combine, in a short period of time, fissile material with a nuclear warhead and an appropriate delivery vehicle.

See transcript of testimony from Natan Sachs of the Brookings Institution from the hearing before the House Foreign Affairs Committee on July 16, 2014, at http://docs.house.gov/meetings/FA/FA00/20140716/102496/HHRG-113-FA00-Transcript-20140716.pdf.

Netanyahu was invited to speak by Speaker of the House John Boehner, sparking debate over the propriety of both their actions vis-à-vis the White House given the contentiousness of the issue and that Israel was to hold national elections on March 17. Vice President Joe Biden, who would otherwise be entitled to attend the speech in his capacity as President of the Senate, was out of the country when the speech was given. Reportedly, 57 voting Members of Congress, including eight Senators, did not attend the speech.

Israeli Prime Minister's website, Transcript of Netanyahu's speech before a joint meeting of Congress, March 3, 2015.

Ben Caspit (translated from Hebrew), "Yadlin says Iran deal isn't a bad agreement," Al-Monitor Israel Pulse, April 3, 2015; Efraim Halevy, "Obama was right, Iran capitulated," Ynetnews, April 6, 2015.

"Israel and Iran: A Tough Deal to Swallow," Economist, April 8, 2015.

According to the Economist, "Many military chiefs, including the chief of staff, Lieutenant General Gadi Eizenkot, have serious misgivings; the efficacy of such an attack on dispersed underground nuclear plants is doubtful, and Israel can scarcely afford the diplomatic crisis such a brazen challenge to the international consensus would cause." "Israel and Iran: A Tough Deal to Swallow," op. cit.

For more information, see CRS Report R43333, Iran Nuclear Agreement, by [author name scrubbed] and [author name scrubbed].

In an April 30 speech, Vice President Biden defended the de-linking of the nuclear issue from other issues in the P5+1-Iran negotiations by drawing the following historical analogy, "Just like arms control talks with the Soviet Union—another regime we fundamentally disagreed with, whose rhetoric and actions were repugnant and unacceptable, whose proxies we forcibly countered around the world—we negotiated to reduce the nuclear threat to prevent nuclear war." Transcript of address by Vice President Biden at the Washington Institute for Near East Policy's Soref Symposium Gala Dinner, April 30, 2015. 

Questions available at https://docs.google.com/file/d/0B4WmUpzDwUW2Zk5oWHJJT2hHcFpZSm9jcEtrNHAxcWR1SkJZ/edit?pli=1.

Thomas L. Friedman, "Iran and the Obama Doctrine," New York Times, April 5, 2015.

Ibid. In addition, to reportedly address legal requirements to maintain Israel's QME, newly-considered U.S. arms sales to Gulf Arab states will apparently not include certain high-performance items that Israel has purchased or plans to purchase, such as F-35 aircraft or GBU-28 bunker-busting munitions. John Hudson, "Israel: Go Ahead and Give the Gulfies Guns," foreignpolicy.com, May 13, 2015.

In an April 6 interview, President Obama said, "I've been very forceful in saying that our differences with Iran don't change if we make sure that they don't have a nuclear weapon—they're still going to be financing Hezbollah, they're still supporting Assad dropping barrel bombs on children, they are still sending arms to the Houthis in Yemen that have helped destabilize the country. There are obvious differences in how we are approaching fighting ISIL in Iraq, despite the fact that there's a common enemy there." "Transcript: President Obama's Full NPR Interview On Iran Nuclear Deal," April 7, 2015.

It is possible, though not certain, that Netanyahu's outspoken criticism of parameters announced in early November 2013—along with French objections—contributed to a toughening of an interim P5+1-Iran agreement reached then with regard to limiting activities connected with Iran's heavy water reactor at Arak. "Israeli PM urges France to resist pressure, hold to conditions on Iran's uranium and plutonium progress," theisraelproject.org, November 2013.

Matthew Lee, "US withholding details of Iran nuke talks from Israel," Associated Press, February 18, 2015.

The sources for this paragraph are Amos Harel, "Washington, Jerusalem discussing massive compensation for Iranian nuclear deal," haaretz.com, May 20, 2015; and Leslie Susser, "The Challenge: Getting the US Back in Israel's Corner," Jerusalem Report, May 18, 2015. On May 19, 2015, the Defense Security Cooperation Agency published a notification of a proposed U.S. sale to Israel of $1.879 billion worth of munitions and associated parts. Amid speculation that the timing of the sale might connect it either to Iran nuclear negotiations or to the replenishment of Israel's stocks following the July-August 2014 Israel-Gaza conflict, an Israeli defense ministry source reportedly denied that the proposed sale is related to nuclear talks or any "conflict in the Gulf region." Avi Lewis, "Pentagon approves massive $1.9 billion arms sale to Israel," Times of Israel, May 20, 2015.

For background information on Syria and Iraq, see CRS Report RL33487, Armed Conflict in Syria: Overview and U.S. Response, coordinated by [author name scrubbed]; CRS Report RS21968, Iraq: Politics and Governance, by [author name scrubbed] and [author name scrubbed]; and CRS Report R43612, The "Islamic State" Crisis and U.S. Policy, by [author name scrubbed] et al.

Barbara Opall-Rome, "Israel's Northern Border Poses Challenges," Defense News, May 3, 2015.

Israeli officials have expressed concern about spillover threats to the Golan Heights border area. For basic information on the U.N. Disengagement Observer Force (UNDOF) that has monitored this area since the Israel-Syria cease-fire in 1974, but now operates from within Israeli-controlled territory after facing multiple attacks in the area beyond Israeli-controlled territory that it had once patrolled, see http://www.un.org/en/peacekeeping/missions/undof/facts.shtml.

Amos Harel and Gili Cohen, "Israel attacked Syrian base in Latakia, Lebanese media reports," haaretz.com, January 27, 2014; Tom Vanden Brook, "Officials: Israeli airstrike inside Syria," USA Today, October 31, 2013; Liz Sly and Susan Haidamous, "Hezbollah warns Israel of retaliation for attack," Washington Post, February 26, 2014.

The initial Israeli strike killed six Hezbollah fighters and an Iranian general traveling with them. Hezbollah retaliatory fire from Lebanon killed two Israeli soldiers, and the Israeli return fire inadvertently killed a U.N. peacekeeper (from Spain) in Lebanon.

Opall-Rome, op. cit.

Isabel Kershner, "Israel Says Hezbollah Military Sites Put Lebanese Civilians at Risk," New York Times, May 13, 2015.

Amos Harel, "Israel's secret weapon in the war against Hezbollah: The New York Times," haaretz.com, May 16, 2015.

Yaroslav Trofimov, "Middle East Crossroads: Syria War Pulls the U.S. and Israel Apart," Wall Street Journal, March 13, 2015. Since the outbreak of conflict in Syria in 2011, Israeli officials have demonstrated ambivalence as to the outcomes they desire in Syria and the possibility of U.S.-led intervention. Though Israel welcomed the late 2013 Russian proposal for the Asad regime to give up its chemical weapons under international auspices, some Israeli analysts have asserted that lack of significant military action in support of President Obama's "red line" on chemical weapons contributed to uncertainty regarding the regional credibility and influence of the United States and its allies or partners.

"Brussels Jewish Museum killings: Suspect 'admitted attack,'" BBC News, June 1, 2014.

For background information on Egypt, see CRS Report RL33003, Egypt: Background and U.S. Relations, by [author name scrubbed].

CRS Insight IN10199, The Islamic State in Egypt: Implications for U.S.-Egyptian Relations, by [author name scrubbed].

Avi Isaacharoff, "Egypt to expand Gaza buffer zone to up to 2 kilometers," Times of Israel, January 6, 2015.

Sinai-based attacks across the border into Israeli territory in 2011 and 2012 highlighted the threat posed by various terrorist groups, including those with links to Palestinian Islamists and global jihadists. Yossi Melman, "The Sinai Imbroglio," Jerusalem Report, August 12, 2013. Additional border incursions have subsequently occurred, and rockets have periodically been fired from Sinai into Israel. Melman, "A shared threat," op. cit.

For information on Hezbollah's capabilities, see CRS Report R42816, Lebanon: Background and U.S. Policy, by [author name scrubbed]; "Hizbullah," Jane's World Insurgency and Terrorism, May 8, 2015; Isabel Kershner, "Israel Says Hezbollah Military Sites Put Lebanese Civilians at Risk," New York Times, May 13, 2015; Yaakov Lappin, "'Iran is placing guided warheads on Hezbollah rockets,'" jpost.com, March 31, 2015; Yossi Yehoshua, "A ticking bomb awaits Israel on its northern border," Ynetnews, April 26, 2015. For information on Palestinian militants' capabilities in Gaza, see CRS Report RL34074, The Palestinians: Background and U.S. Relations, by [author name scrubbed].

Ben Caspit (translated from Hebrew), "Israel eases Gaza blockade, hopes for Hamas stability," Al-Monitor Israel Pulse, April 30, 2015.

Ben Birnbaum and Amir Tibon, "The Explosive, Inside Story of How John Kerry Built an Israel-Palestine Peace Plan—and Watched It Crumble," New Republic, July 20, 2014; Edward Isaac-Dovere, "How the Obama peace process went 'poof,'" Politico, April 13, 2014; Nathan Thrall, "Faith-Based Diplomacy," Matter, September 18, 2014.

U.N. Office for the Coordination of Humanitarian Affairs occupied Palestinian territory (UN-OCHA opt), Humanitarian Bulletin, April 2015, Annex: Monthly Indicator Tables, "Conflict-related casualties and violence."

Nir Hasson, "Two Israeli police officers lightly wounded in suspected East Jerusalem terror attack," haaretz.com, May 20, 2015.

Netanyahu has pledged that any peace deal involving possible military withdrawals would be subject to a popular referendum. Additionally, in March 2014, the Knesset unanimously voted to create a new quasi-constitutional Basic Law requiring a popular referendum to approve any peace plan that would relinquish control over East Jerusalem or the Golan Heights.

Akiva Eldar, "Israel's New Politics and the Fate of Palestine," The National Interest, July/August 2012; Peter Beinart, The Crisis of Zionism, New York: Times Books, 2012.

Considerable public debate in Israel takes place regarding Jewish-Arab demographics in Israel-West Bank-Gaza Strip; their potential domestic, regional, and international implications; and possible Israeli options. See, e.g., Leslie Susser, "The Right Touts a One-State Solution," Jerusalem Report, July 29, 2013; PowerPoint presentation dated October 9, 2014, from former Israeli diplomat Yoram Ettinger, available at http://www.theettingerreport.com/Demographic-Scare/From-Demographic-Fatalism-to-Demographic-Optim-(2).aspx.

See, e.g., Gili Cohen, "Top Israeli think tank: If talks fail, Israel should withdraw from 85% of West Bank," haaretz.com, January 28, 2014; Raphael Ahren, "If peace talks fail: Michael Oren's Plan B," Times of Israel, February 26, 2014. This option first gained popularity under late Prime Minister Ariel Sharon in the mid-2000s, and was the basis for Israel's 2005 withdrawal from the Gaza Strip, but was sidetracked after Sharon's debilitating stroke in 2006 and a number of subsequent security-related and political developments.

Amy Teibel, "Netanyahu Wants Separation from Palestinians, Official Says," Bloomberg, June 6, 2014. During his time as opposition leader in the mid-2000s, Netanyahu had strenuously objected to the idea and supported popular views blaming threats from the Gaza Strip and southern Lebanon on previous Israeli military withdrawals.

David Horovitz, "Netanyahu finally speaks his mind," Times of Israel, July 13, 2014.

"'A Palestinian state in the heart of Israel is crazy,'" Washington Post, May 31, 2015. See also Naftali Bennett, "For Israel, Two-State Is No Solution," New York Times, November 6, 2014. Bennett supports the annexation of areas of the West Bank under current Israeli security and administrative control—known as "Area C" in reference to a 1995 Israel-PLO agreement and comprising approximately 60% of the West Bank's territory. "Bennett calls to annex 60 percent of West Bank," Times of Israel, April 27, 2014. See map in CRS Report RL34074, The Palestinians: Background and U.S. Relations, by [author name scrubbed].

See, e.g., Henry Siegman, "Obama's Slim Chance for Mideast Peace," New York Times, May 20, 2015.

"Us and them," Economist, August 2, 2014.

See, e.g., Jodi Rudoren, "Netanyahu Calls International Criticism an Effort to 'Delegitimize Israel," New York Times, June 1, 2015.

Ibid.

U.N. Press Release: "Resolution in Security Council to Impose 12-Month Deadline on Negotiated Solution to Israeli-Palestinian Conflict Unable to Secure Nine Votes Needed for Adoption," December 30, 2014. Among other issues, the draft resolution would have affirmed "the urgent need" to attain a negotiated two-state solution within 12 months, and would have "decided" that the solution was to be based on a number of parameters, including "a full and phased withdrawal of the Israeli occupying forces, which will end the occupation that began in 1967 over an agreed transition period in a reasonable timeframe, not to exceed the end of 2017." See the text of the draft resolution at http://unispal.un.org/unispal.nsf/5ba47a5c6cef541b802563e000493b8c/a12252711015996d85257dbf00536b1c?OpenDocument.

See CRS Report RL34074, The Palestinians: Background and U.S. Relations, by [author name scrubbed].

ICC Press Release, "The Prosecutor of the International Criminal Court, Fatou Bensouda, opens a preliminary examination of the situation in Palestine," January 16, 2015.

Joel Greenberg, "Netanyahu blasts international court over preliminary probe of war crimes claims," McClatchyDC, January 17, 2015.

It is unclear how the investigation and its findings will be similar to or differ from the UNHRC-mandated investigations undertaken following the December 2008-January 2009 Israel-Gaza conflict, known as the "Goldstone Report" and available at http://www2.ohchr.org/english/bodies/hrcouncil/docs/12session/A-HRC-12-48.pdf.

Israel's military has opened a number of criminal investigations into incidents during the conflict in which Palestinian civilians were killed, possibly facilitating potential Israeli efforts to respond to the work of the UNHRC-appointed commission and to forestall potential ICC prosecution. Jeffrey Heller and Dan Williams, "Israel's military opens eight new probes into its Gaza war conduct," Reuters, December 7, 2014; Amos Harel and Gili Cohen, "Top IDF attorney: I will never call IDF the most moral army in the world," haaretz.com, April 9, 2015. William Schabas, the Canadian law professor who was initially selected to head the commission, resigned his place in February 2015 after Israel provided evidence that he had previously done paid work for the PLO. U.S. jurist Mary McGowan Davis was named to replace Schabas. "Schabas resigns as head of U.S. Gaza inquiry panel," JTA, February 3, 2015.

"Israel, US boycott UN human rights inquiry on Gaza, West Bank," Deutsche Welle, March 23, 2015.

Text of the summary and cover letter available at http://domino.un.org/UNISPAL.nsf/22f431edb91c6f548525678a0051be1d/554e1cc298b3bfef85257e44005abd18.

See the original July 2005 "call" for BDS from various Palestinian civil society groups at http://www.bdsmovement.net/call. See also Sean F. McMahon, "The Boycott, Divestment, Sanctions Campaign: Contradictions and Challenges," Race & Class, vol. 55, issue 4, July-September 2014; Marc Tracy, "With All the Boycott Israel Talk, What Is BDS?," newrepublic.com, February 2, 2014;

See, e.g., Jennifer Medina and Tamar Lewin, "Views on Israel Drive a Wedge in Campus Life," New York Times, May 10, 2015; David Makovsky and Raquel Saxe, "BDS's Useless Politics of Confrontation," Times of Israel, May 22, 2015.

See, e.g., Rudoren, "Netanyahu Calls International Criticism an Effort to 'Delegitimize Israel," op. cit.; Peter Beinart, "To Save Israel, Boycott the Settlements," New York Times, March 18, 2012.

Madison Marriage and John Reed, "US pension funds to divest from Israel boycotters," ft.com, May 31, 2015.

Rudoren, "Netanyahu Calls International Criticism an Effort to 'Delegitimize Israel,'" op. cit.

H.R. 4009 (The Protect Academic Freedom Act) from the 113^th Congress would have prohibited institutions of higher education from receiving federal funds if they participate in boycotts of Israeli institutions or scholars.

Marriage and Reed, op. cit.; Sean Savage, "Tennessee General Assembly Becomes First State Legislature to Condemn BDS," JNS.org, April 21, 2015.

Leslie Susser, "European Arm-Twisting," Jerusalem Report, November 17, 2014.

Raphael Ahren, "EU Offers 'Unprecedented' Aid to Israelis, Palestinians for Peace Deal," Times of Israel, December 16, 2013; "Us and them," op. cit.

The United States and Israel both urged the EU to maintain its sanctions against Hamas. In addition to having listed Hamas's military wing on its common terrorist list since 2001, the EU has listed its political wing since 2003. In addition, the EU common terrorist list includes two charities that are believed to be related to Hamas: the U.S.-based Holy Land Foundation for Relief and Development; and Al-Aqsa, e.V. (or the Al-Aqsa Foundation), located throughout Europe.

Adrian Croft, "EU to appeal ruling that Hamas should be off terror list," Reuters, January 19, 2015.

Jim Yardley, "Europe's Anti-Semitism Comes Out of the Shadows," New York Times, September 23, 2014.

Bernard Avishai, "Sorry, Bibi. Europe's Jews won't be rushing to Israel anytime soon," Washington Post, February 22, 2015.

"Fear of a new darkness," Economist, February 21, 2015.

"A campaign that is gathering weight," Economist, February 8, 2014. See footnote 223 for information on Israel-EU trade as a percentage of Israel's total trade volume.

Andrew Rettman, "EU states promote settler boycott amid Israel crisis," EUObserver, July 4, 2014.

Susser, "European Arm-Twisting," op. cit.

Prepared testimony of David Pollock, Washington Institute for Near East Policy, "Threats to Israel: Terrorist Funding and Trade Boycotts," House Committee on Foreign Affairs, Subcommittee on Terrorism, Trade, and Nonproliferation, March 5, 2014.

Andrew Rettman, "Mogherini makes light of leaked EU paper on Israel sanctions," EUObserver, November 18, 2014.

Barak Ravid, "European FMs urge policy chief: Label West Bank settlement products," haaretz.com, April 16, 2015.

Sarah Saadoun, "Don't protect Israeli settlement trade," The Hill, May 15, 2015; Melissa Apter, "Home Run for Cardin," Baltimore Jewish Times, April 30, 2015.

Summary of conversation between Netanyahu and Erdogan from Israeli Prime Minister's Office website, March 22, 2013. The May 2010 Gaza flotilla incident involved the boarding in international waters by Israeli commandos of a ship that was commissioned by a Turkish Islamist nongovernmental organization to carry goods to the Israeli-blockaded Gaza Strip. Under disputed circumstances, the commandos reportedly killed nine Turks and an American of Turkish ancestry and injured several others. To normalize relations, Turkey demanded that Israel apologize for its role in the incident, provide agreeable compensation to the victims' families, and lift its closure regime on the movement of goods and people in and out of Gaza. In addition to Netanyahu's apology to Erdogan, negotiations have been conducted regarding compensation, and Turkish officials previously indicated that they might interpret Israel's allowance of Turkish humanitarian aid shipments to Gaza as a lifting of the closure regime.

See transcript of House Foreign Affairs Committee joint subcommittee hearing, September 9, 2014, at http://docs.house.gov/meetings/FA/FA13/20140909/102629/HHRG-113-FA13-Transcript-20140909.pdf.

David Ignatius, "Turkey blows Israel's cover for Iranian spy ring," Washington Post, October 16, 2013.

Ora Coren, "Israeli trade with Turkey on track to reach record," haaretz.com, July 4, 2014.

"The 'Missed Opportunity' in Israeli-Turkish Trade Relations," Knowledge@Wharton Blog, September 9, 2014. Since the outbreak of conflict in Syria, Turkey has relied on Israel's port in Haifa to help re-route trade traffic that had previously traversed Syrian territory. Lior El-Hai, "Israel has become bridge between Turkey, Jordan," Ynetnews, April 25, 2013.

Malka, op. cit., pp. 93-94.

See, e.g., Michael Eisenstadt, "Resetting the U.S.-Israel Alliance," War on the Rocks, February 5, 2015. But see Richard Klass, "Is Israel Becoming a Strategic Liability," War on the Rocks, January 28, 2015.

Bruck, op. cit.

According to a 2011 report, some U.S. military officers and analysts, including "senior Pentagon officials, generals and independent defense strategists," weigh the "direct military benefits the United States receives from its partnership with Israel … against the geopolitical costs the relationship imposes on Washington in its dealings with the broader Arab and Muslim world; some suggest a net negative outcome for Washington in the equation." Nathan Guttman, "Israel Is Strategic Asset After All," Jewish Daily Forward, November 18, 2011.

See, e.g., Uriel Heilman, "Why the U.S. and Israel are not getting along," JTA, September 2, 2014.

In a February 2015 interview, National Security Advisor Susan Rice said that the scheduling of Netanyahu's March 3 congressional address injected the U.S.-Israel relationship with "a degree of partisanship, which is not only unfortunate, I think it's destructive of the fabric of the relationship." In the same interview, however, Rice also said that Israel is the closest U.S. ally in the region and that the Administration wants the bilateral relationship to be "unquestionably strong, immutable, regardless of political seasons in either country and regardless of which party is in control in either country." Transcript of remarks by National Security Advisor Rice on PBS: The Charlie Rose Show, February 24, 2015.

Sam Stein, "Obama Details His Disappointment With Netanyahu In First Post-Election Comments," Huffington Post, March 21, 2015.

Ibid.

Helene Cooper and Michael D. Shear, "White House Ties May Be Past Mending," New York Times, March 19, 2015.

Stewart Ain, "Congressional Push To Get U.S., Israel To 'Dial It Down,'" New York Jewish Week, April 1, 2015.

Transcript available at http://www.cq.com/doc/congressionaltranscripts-4646226?0.

Transcript available at http://www.cq.com/doc/congressionaltranscripts-4663248?5.

Transcript of remarks by Under Secretary Sherman at the Religious Action Center of Reform Judaism Biennial Leadership Policy Conference, Arlington, VA, April 27, 2015.

The Jewish Virtual Library maintains a page that contains hyperlinked documents, speeches, and reports under the heading "U.S.-Israel Relations: Strategic & Military Cooperation," available at http://www.jewishvirtuallibrary.org/jsource/US-Israel/strattoc.html.

For information on the War Reserves Stock Allies-Israel (WRSA-I) program, under which the United States maintains munitions stockpiles for its own use and for Israel's use in some situations with U.S. permission, see CRS Report RL33222, U.S. Foreign Aid to Israel, by [author name scrubbed].

For information on the STA licensing exception, see Export Control Reform Initiative Factsheet #4: License Exception "Strategic Trade Authorization" (STA). Available at http://new.export.gov/cms_files/ECR%20Factsheet%204%20-%20STA_Latest_eg_main_047475.pdf. Israel, along with seven other countries, currently has a more limited form of the STA licensing exception.

For more information, see CRS Report RL32221, Visa Waiver Program, by [author name scrubbed].

§36(h) of the Arms Export Control Act, which contains the "qualitative military edge" requirement, was added by §201(d) of the Naval Vessel Transfer Act of 2008 (P.L. 110-429). The act defines QME as "the ability to counter and defeat any credible conventional military threat from any individual state or possible coalition of states or from nonstate actors, while sustaining minimal damages and casualties, through the use of superior military means, possessed in sufficient quantity, including weapons, command, control, communication, intelligence, surveillance, and reconnaissance capabilities that in their technical characteristics are superior in capability to those of such other individual or possible coalition of states or nonstate actors." The details of official U.S. assessments of QME are generally classified.

Barbara Opall-Rome, "Israeli Brass Decry U.S. Arms Sales to Arab States," Defense News, January 23, 2012. According to this article, the U.S. side of the working group is led by the Under Secretary of Defense for Policy and Assistant Secretary of State for Political-Military Affairs, while the Israeli side is led by the Defense Ministry's policy chief and the Israel Defense Forces director of planning.

Eli Lake (citing Duty by Robert Gates), "In Gates Book, Details of Israel's Hard Bargaining Over Saudi Arms," Daily Beast, January 10, 2014. Gates recounted that he told Prime Minister Netanyahu and then Defense Minister Ehud Barak that they should welcome the sale to Saudi Arabia because of a common Israeli-Saudi interest in countering Iran, and that if the Saudis did not purchase U.S. arms, they might purchase arms from countries (such as France or Russia) that would not include Israel's QME in their calculations. A former senior Pentagon official was cited as saying that Israel's concerns were based on "worries about what might happen if the House of Saud lost power to a more radical regime." Ibid.

John Hudson, "Israel: Go Ahead and Give the Gulfies Guns," foreignpolicy.com, May 13, 2015.

See, e.g., Dov Zakheim, "Summit to Nowhere," foreignpolicy.com, May 15, 2015.

Text of letters available at http://www.armed-services.senate.gov/press-releases/senate-armed-services-committee-members-call-for-urgent-support-to-jordan-in-fight-against-isil. See also Julian Pecquet, "Congress may re-examine special arms deals with Israel," Al-Monitor Congress Pulse, February 5, 2015.

The United States and Israel do, however, have a Mutual Defense Assistance Agreement (TIAS 2675, dated July 23, 1952) in effect regarding the provision of U.S. military equipment to Israel (see "End-Use Monitoring"), and have entered into a range of stand-alone agreements, memoranda of understanding, and other arrangements varying in their formality.

President Obama, in a February 5, 2012, NBC interview, said while responding to questions regarding a possible Israeli military strike against Iranian nuclear facilities: "I will say that we have closer military and intelligence consultation between our two countries than we ever have. And my number one priority continues to be the security of the United States, but also the security of Israel." In a March 2006 speech against the backdrop of Iran's hostile rhetoric toward Israel and pursuit of a nuclear program, President George W. Bush said, "I made it clear, I'll make it clear again, that we will use military might to protect our ally Israel." Seymour M. Hersh, "The Iran Plans," New Yorker, April 17, 2006.

Additionally, in response to Iraqi Scud missile attacks on Israel during the 1991 Gulf War, both the House (H.Con.Res. 41) and Senate (S.Con.Res. 4) unanimously passed January 1991 resolutions "reaffirming America's continued commitment" to provide Israel with the means to maintain its freedom and security.

Richard N. Rosecrance and Chuck Freilich, "Confronting Iran: A US Security Guarantee for Israel?" bitterlemons-international.org, July 6, 2006. See also Chuck Freilich, Speaking About the Unspeakable: U.S.-Israeli Dialogue on Iran's Nuclear Program, Washington Institute for Near East Policy, PolicyFocus #77, December 2007; Malka, op. cit., pp. 84-89.

One Israeli report states figures indicating that approximately 16% (10.2 billion shekels, roughly equal to $2.56 billion) of Israel's total 2014 defense expenditures, which includes expenditures on all security forces (i.e., military, Mossad, Israel Security Agency or Shin Bet) were purchases in foreign currency, funded mainly by U.S. aid. The report stated that Israeli defense consumption for 2014 was about 5.7% of GDP, and that local consumption (defense expenditures not counting foreign currency expenditures) equaled about 4.6% of GDP. Shmuel Even, "The Debate over Israel's Defense Budget," Strategic Assessment, March-April 2015.

"Israel announces purchase of 14 more F-35 fighter jets," Associated Press, February 22, 2015.

Luis Martinez, "U.S. Has Sold Ammunition to Israel Since Start of Gaza Conflict," ABC News, July 30, 2014. WRSA-I stockpiles located in Israel are in excess to U.S. military requirements, and an unnamed U.S. defense official was cited as saying that "the requested ammunition was approaching the end of its shelf life at the stockpile and would have needed to be restocked anyway." Israel supposedly requested the sale on July 20, days after it began its ground operations in Gaza, but the sale was reportedly not requested on an emergency basis, as was a sale from the U.S. stockpile during Israel's 2006 conflict with Hezbollah. See also David Schenker, "Best Friends Don't Have to Ask," Politico, August 14, 2014, claiming that the late July purchase was for "training rather than operational purposes."

Adam Entous, "Gaza Crisis: Israel Outflanks the White House on Strategy," Wall Street Journal, August 14, 2014. According to one report, the Hellfire missile transfer later resumed. "U.S. resumes transfer of Hellfire missiles to Israel after summer holdup," JNS.org, September 30, 2014.

Reports based on Israeli military sources indicate that Iron Dome has had a high rate of success in intercepting short-range rockets fired from Gaza. It is unknown if the United States or another third party has independently verified Israeli claims, and analysts have debated the claims' validity. For analyses of Iron Dome, see Peter Dombrowski, et al., "Demystifying Iron Dome," National Interest, July-August 2013; Mark Stout, "Israel's Iron Maginot Line System," War on the Rocks, August 4, 2014; Inbal Orpaz et al., "Meet Israel's home-front hero: Iron Dome," haaretz.com, July 18, 2014; David Axe, "Israel's Iron Dome is more like an iron sieve," blogs.reuters.com, July 25, 2014. Although Iron Dome is costly in comparison with the Gaza-based rockets it has intercepted, analysts debate whether the system's cost-effectiveness is better measured by armament attrition or by comparing the system's costs with estimates of damage that would likely occur in its absence. See, e.g., Philip Giraldi, "Is Iron Dome the Maginot Line?" theamericanconservative.com, December 3, 2012; Matthew Fargo, "Iron Dome–A Watershed for Missile Defense?" csis.org/blog, December 3, 2012. For more information, see CRS Report RL33222, U.S. Foreign Aid to Israel, by [author name scrubbed].

Text of letter from Secretary Hagel to Senate Majority Leader Harry Reid available at http://www.scribd.com/doc/234880111/Hagel-to-Reid-Iron-Dome.

"Hackers Plundered Israeli Defense Firms that Built 'Iron Dome' Missile Defense System," KrebsonSecurity, July 28, 2014.

Samuel Gibbs, "Chinese hackers steal Israel's Iron Dome missile data," theguardian.com, July 29, 2014; "Companies Behind Israel's Iron Dome Hacked by China: Report," Reuters, July 29, 2014.

Egypt and Jordan have been routinely held out as examples showing that even if making peace with Israel was unpopular with the countries' populations, their autocratic or monarchical leaders could normalize and maintain relations with Israel without significantly losing their capacity or legitimacy to rule. Israeli concerns may have been mitigated somewhat after the July 2013 ouster of Mohammed Morsi as Egypt's president, but even given Israel's generally positive relations with President Abdel Fattah al Sisi, Israel's leaders may remain more sensitive than before 2011 to the possibility of regional political change.

The Arab Peace Initiative offers a comprehensive Arab peace with Israel if Israel were to withdraw fully from the territories it occupied in 1967, agree to the establishment of a Palestinian state with a capital in East Jerusalem, and provide for the "[a]chievement of a just solution to the Palestinian Refugee problem in accordance with UN General Assembly Resolution 194." The initiative was proposed by Saudi Arabia, adopted by the 22-member Arab League (which includes the PLO), and later accepted by the 56-member Organization of the Islamic Conference (now the Organization of Islamic Cooperation) at its 2005 Mecca summit. The text of the initiative is available at http://www.bitterlemons.org/docs/summit.html.

Netanyahu accepted the idea of a two-state solution in principle, but insisted that any Palestinian state would need to be demilitarized and remain subject to indefinite Israeli control of its airspace, the electromagnetic spectrum used for telecommunications, and the Jordan Valley. President Obama's May 2011 speeches calling for renewed Israeli-Palestinian negotiations focused on the issues of borders and security parameters. Netanyahu complained that Obama's proposal to use the Green Line as the reference point for border negotiations did not properly take into account historical Israeli security concerns regarding defensibility of territory.

138 member states voted in favor of Resolution 67/19, nine voted against (including the United States and Israel), and 41 abstained. The PLO has had permanent observer status at the United Nations since 1974. "Palestine" maintains many of the capacities it had as an observer entity—including participation in General Assembly debates and the ability to co-sponsor draft resolutions and decisions related to proceedings on Palestinian and Middle East issues. However, it is not a member of the United Nations, and does not have the right to vote or to call for a vote in the General Assembly. For more information on this resolution and various Palestinian international initiatives, see CRS Report RL34074, The Palestinians: Background and U.S. Relations, by [author name scrubbed]; CRS Report R43614, Membership in the United Nations and Its Specialized Agencies, by [author name scrubbed] and [author name scrubbed]; and CRS Report R42999, The United Nations Educational, Scientific, and Cultural Organization (UNESCO), by [author name scrubbed] and [author name scrubbed].

However, the PLO's fall 2011 application to obtain membership in the United Nations has not cleared the U.N. Security Council's membership committee. U.N. Security Council, "Report of the Committee on the Admission of New Members concerning the application of Palestine for admission to membership in the United Nations," S/2011/705, November 11, 2011.

Israel's insistence on this explicit recognition has reportedly gained in emphasis over time, and Palestinian officials claim that the demand is a "new addition" to negotiations that was not included at the time the Oslo process began in the 1990s. See, e.g., Dan Perry, "Israeli demand sparks 'Jewish state' debate," Associated Press, February 21, 2014; Jodi Rudoren, "Sticking Point in Peace Talks: Recognition of a Jewish State," New York Times, January 1, 2014. In May 8, 2014, remarks, then U.S. Special Envoy for Israeli-Palestinian Negotiations Martin Indyk said that Israeli insistence on recognition of Israel as the nation-state of the Jewish people was introduced into an Israeli-Palestinian negotiating context by Tzipi Livni when she was Israeli foreign minister during the 2007-2008 Annapolis process. The Pursuit of Middle East Peace: A Status Report, Ambassador Martin Indyk, Washington Institute for Near East Policy, May 8, 2014.

Elhanan Miller, "Arab ministers back Abbas in rejecting 'Jewish' Israel," Times of Israel, January 13, 2014. The United States sometimes seeks regional Arab support on certain positions that are domestically unpopular with Palestinians, probably in order to create political space for PLO leaders to more seriously consider accepting these positions or to apply pressure on them to do so. In April 2013, representatives of the Arab League agreed that land swaps could be an element of a conflict-ending agreement between Israel and the PLO. For information on the Arab Peace Initiative, see footnote 151.

See, e.g., "Don't forget what we lost, too," Economist, February 15, 2014. In the 112^th Congress, Representative Jerrold Nadler sponsored H.R. 6242 ("To direct the President to submit to Congress a report on actions the executive branch has taken relating to the resolution of the issue of Jewish refugees from Arab countries."). The bill garnered 10 co-sponsors.

In a January 2014 interview for a conference held by Israel's Institute for National Security Studies, Abbas said that he could accept a "transitional period" (presumably applying to Jordan Valley security) of no more than three years for Israel to gradually withdraw, at which point a third party—Abbas proposed NATO—could take Israel's place as a security guarantor. Footage with English translation available at http://www.youtube.com/watch?v=Cx9tY8JU1kQ&list=PLCapdZwzDpNlwSoHcbkXL9sMVbQcQMaQ-.

Shimon Shiffer, "Ya'alon: Kerry should win his Nobel and leave us alone," Ynetnews, January 14, 2014. Israeli Defense Minister Ya'alon reportedly responded to proposals by the Kerry-Allen team as follows: "You presented us with a plan that is based on sophisticated technology, on satellites, sensors, war rooms with television screens—without a presence of our troops on the ground. And I ask you—how will technology respond when a Salafist or Islamic Jihad cell tries to commit a terror attack against Israeli targets? ... Which satellites will handle the rocket industry developing today ... that will be fired at Tel Aviv and central Israel?" Josef Federman, "Israeli defense chief comments spark spat with US," Associated Press, January 14, 2014.

William Booth, "Israel says Palestinians push a 'culture of hate' that could undermine talks," Washington Post, January 7, 2014.

Nahum Barnea, "Netanyahu's secret peace offer concessions to Palestinians revealed," Ynetnews, March 6, 2015. Its partial publication may have at least partly motivated Netanyahu's skeptical remarks regarding prospects for a two-state solution near the end of the campaign.

An unnamed senior official in Netanyahu's office was cited as saying that the document leaked reflected American positions, not Netanyahu's. Linda Gradstein, "Netanyahu rules out Palestinian state based out '67 borders with swaps in order to shore up right flank," Media Line, March 9, 2015.

Jack Khoury and Barak Ravid, "Palestinians reject Netanyahu's proposal to discuss settlement borders," haaretz.com, May 26, 2015.

For more information on the consensus PA government, see CRS Report RL34074, The Palestinians: Background and U.S. Relations, by [author name scrubbed].

Philip Gordon, "Netanyahu, not Obama, has the power to make peace," Financial Times, May 7, 2015.

Barak Ravid, citing French daily Le Figaro, in "Report: French UN resolution sets 18-month deadline for Israeli-Palestinian deal," haaretz.com, May 20, 2015.

David Makovsky, "Netanyahu Loses Leverage in Forming New Government," Washington Institute for Near East Policy, PolicyWatch 2421, May 8, 2015.

See, e.g., Neri Zilber, "What Will Happen If the Palestinians Really End Security Cooperation?," The Tower, April 2015; Ghaith al Omari, "Preserving Israeli-Palestinian Security Cooperation," Washington Institute for Near East Policy, April 10, 2015.

Nadia Bilbassy, "Full transcript of President Obama's TV interview with Al Arabiya," Al Arabiya, May 17, 2015.

Ibid. In a separate May interview, Obama emphasized the importance of "reinvigorating Gaza's connection with the West Bank and reestablishing [the Palestinians'] strong commercial links with Israel and the global economy." "Obama: We are prepared to use all elements of our power to secure our interests in the Middle East," Asharq Al-Awsat Online, May 13, 2015.

Jordan had occupied these areas militarily since 1948, and unilaterally annexed them and the entire West Bank in 1950. It only ceded its claims in 1988—to the PLO.

In 1980, under the first Likud Party government, the Israeli Knesset passed the Basic Law: Jerusalem—Capital of Israel, which declares "Jerusalem, complete and united, is the capital of Israel." See http://www.mfa.gov.il for the complete text of the Basic Law. Israel had first declared Jerusalem to be its capital in 1950.

Wendy Pullan, et al., The Struggle for Jerusalem's Holy Places, Routledge: New York, 2013, p. 15; Ir Amim and Keshev, Dangerous Liaison: The Dynamics of the Rise of the Temple Movements and Their Implications, March 1, 2013, pp. 12-15.

Jeremy Sharon, "Chief Rabbis reimpose ban on Jews visiting Temple Mount," jpost.com, December 2, 2013.

Pullan, op. cit., p. 37.

See, e.g., Nathan Thrall, "Rage in Jerusalem," London Review of Books, December 4, 2014 (initially published online November 21, 2014).

See, e.g., "Undivided and eternal unhappiness," Economist, November 8, 2014

Herb Keinon, "Poll: 3 in 4 Israeli Jews oppose a Palestinian state if it means dividing Jerusalem," jpost.com, October 20, 2014.

Gil Ronen, "PM Calms Jordan: No Change in Temple Mount 'Status-Quo,'" Arutz Sheva, October 22, 2014.

For information on the legal status of Palestinian residents of East Jerusalem, see http://www.btselem.org/jerusalem/legal_status.

"Murder in the synagogue," Economist, November 22, 2014.

The DC Circuit's July 2013 opinion is available at http://www.cadc.uscourts.gov/internet/opinions.nsf/C8DC59BCC7D10E6D85257BB10051786D/$file/07-5347-1447974.pdf. For more information, see CRS Report R43773, Zivotofsky v. Kerry: The Jerusalem Passport Case, by [author name scrubbed].

Figures downloadable from Peace Now website at http://peacenow.org.il/eng/content/settlements-and-outposts. For information on the planning and permitting process for settlement construction, see http://peacenow.org.il/eng/content/planningprocess.

CIA World Factbook estimates as of July 2014.

Jodi Rudoren and Jeremy Ashkenas, "Netanyahu and the Settlements," nytimes.com, March 12, 2015.

For more information on the history of the settlements and their impact on Israeli society, see Idith Zertal and Akiva Eldar, Lords of the Land: The War for Israel's Settlements in the Occupied Territories, 1967-2007, New York: Nation Books, 2007; Gershom Gorenberg, The Accidental Empire: Israel and the Birth of the Settlements, 1967-1977, New York: Times Books, 2006.

The most-cited international law pertaining to Israeli settlements is the Fourth Geneva Convention, Part III, Section III, Article 49 Relative to the Protection of Civilian Persons in Time of War, August 12, 1949, which states in its last sentence, "The Occupying Power shall not deport or transfer parts of its own civilian population into the territory it occupies." Israel insists that the West Bank does not fall under the international law definition of "occupied territory," but is rather "disputed territory" because the previous occupying power (Jordan) did not have an internationally recognized claim to it, and given the demise of the Ottoman Empire at the end of World War I and the end of the British Mandate in 1948, Israel claims that no international actor has superior legal claim to it.

"Israel's West Bank housing policy by numbers," Agence France Presse, May 10, 2015, quoting Rabbis for Human Rights.

In a July 2004 International Court of Justice advisory opinion, the barrier's construction was deemed illegal by the International Court of Justice. The text of the opinion is available at http://www.icj-cij.org/docket/index.php?pr=71&code=mwp&p1=3&p2=4&p3=6.

Daniel Kurtzer, "Do Settlements Matter? An American Perspective," Middle East Policy, vol. 16, issue 3, fall 2009.

Nicholas Rostow, "Are the Settlements Illegal?" The American Interest, March/April 2010.

Aaron David Miller, "The Inside Story of U.S. Meddling in Israel's Elections," Daily Beast, December 4, 2014.

For more information on this issue, see CRS Report RL33222, U.S. Foreign Aid to Israel, by [author name scrubbed].

U.S. and Israeli leaders publicly differed on whether Obama's expectations of Israel contradicted statements that the George W. Bush Administration had made. Some Israeli officials and former Bush Administration officials said that the United States and Israel had reached an unwritten understanding that "Israel could add homes in settlements it expected to keep [once a final resolution with the Palestinians was reached], as long as the construction was dictated by market demand, not subsidies." Glenn Kessler and Howard Schneider, "U.S. Presses Israel to End Expansion," Washington Post, May 24, 2009. This article quotes former Bush Administration deputy national security advisor Elliott Abrams as saying that the United States and Israel reached "something of an understanding." The accounts of former Bush Administration officials diverge in their characterization of U.S.-Israel talks on the subject, but the Obama Administration has insisted that if understandings ever existed, it is not bound by them. Ethan Bronner, "Israelis Say Bush Agreed to West Bank Growth," New York Times, June 3, 2009.

"United States vetoes Security Council resolution on Israeli settlements," UN News Centre, February 18, 2011.

White House Press Briefing, December 5, 2014.

Text of letter available at http://meadows.house.gov/media-center/press-releases/meadows-authors-letter-to-president-demanding-answers-on-israel.

This report relied on unnamed "senior Israeli officials" as sources, and said that a "few American officials" later approached did not deny that a meeting had taken place. Barak Ravid, "U.S. mulls harsher action against settlement construction," haaretz.com, December 4, 2014. Possible steps reportedly discussed apparently included the United States potentially refraining from "vetoing condemnatory resolutions against the settlements in the UN Security Council," or potentially issuing "clearer instructions to American officials about the ban on cooperating with the settlements or funding activity in them." Ibid. When asked about the reports at the December 5 White House press briefing, White House Press Secretary Josh Earnest refused to discuss internal deliberations while stating that Israel is a "close and strategic partner" of the United States, that the two countries have "strong and unshakable bonds," and that the United States maintains an "exceedingly strong commitment" to Israel's security.

Elliott Abrams and Uri Sadot, "Settling Settlements," foreignaffairs.com, April 16, 2015.

Report available at http://peacenow.org.il/eng/sites/default/files/ConstructionReport2014Eng_0.pdf. The report documents 3,100 construction starts from June 2013 to September 2014, and 2,243 starts from March 2012 to May 2013 (a 38% increase from one period to the next). The reporting periods are determined by the intervals of time that lapse between Peace Now's receipt of new sets of aerial photos depicting construction.

See, e.g., Rudoren and Ashkenas, op. cit., quoting Hagit Ofran of Peace Now; Abrams and Sadot, op. cit.

Joel Greenberg, "Israeli settlers evacuated from West Bank outpost following court order," Washington Post, September 2, 2012.

22 U.S.C. §2785.

Other customers for Israeli arms include Germany, Spain, France, Canada, Australia, Turkey, Singapore, Brazil, Italy, the Netherlands, Poland, Finland, Azerbaijan, and Romania. Israel is also reportedly seeking to expand arms exports to Latin America.

Office of Naval Intelligence, Worldwide Challenges to Naval Strike Warfare, 1996. The 1997 edition of this report said that the design for China's J-10 fighter (also known as the F-10—the designation used in the report) "had been undertaken with substantial direct assistance, primarily from Israel and Russia, and with indirect assistance through access to U.S. technologies." ONI, Worldwide Challenges to Naval Strike Warfare, 1997. See also Robert Hewson, "Chinese J-10 'benefited from the Lavi project,'" Jane's Defence Weekly, May 16, 2008; Duncan L. Clarke and Robert J. Johnston, "U.S. Dual-Use Exports to China, Chinese Behavior, and the Israel Factor: Effective Controls?" Asian Survey, Vol. 39, No. 2, March-April 1999. The Lavi fighter (roughly comparable to the U.S. F-16) was developed in Israel during the 1980s with approximately $1.5 billion in U.S. assistance, but did not get past the prototype stage. In 2000, a planned Israeli sale to China of the Phalcon airborne radar system was canceled under U.S. pressure.

"U.S. Israel Agree to Consult on Future Israeli Weapons Sales - Nations Affirm Joint Commitment to Address Global Security Challenges," U.S. State Department Press Release, August 17, 2005.

Barbara Opall-Rome, "Israel Replaces Export Control Chief After Tech Transfer to China," DefenseNews, January 3, 2014.

Yaakov Lappin, "Report finds failings in defense export supervision," Jerusalem Post, July 18, 2013.

Vivek Raghuvanshi, "India, Israel to Build Missile Defense System," Defense News, February 26, 2015. India faces potential missile threats from Pakistan and China.

"India Chooses Israel Over US for $525M Missile Deal, Sources Say," Agence France Presse, October 26, 2014.

Sean McCormack, U.S. Department of State Spokesman, Daily Press Briefing, Washington, DC, January 29, 2007. The Consolidated Appropriations Act, 2008 (P.L. 110-161) significantly restricted the export of U.S.-manufactured cluster munitions. Restrictions on cluster munitions exports have been carried forward to apply to appropriations in subsequent years as well. Since 2008, Israel has been acquiring domestically manufactured cluster munitions.

Some Palestinian groups and other Arab and international governments, along with at least one Member of Congress, have characterized Israeli military operations against Palestinians (such as Israel's 2008-2009 Operation Cast Lead, which was directed against Hamas in the Gaza Strip) as acts of aggression. During the 111^th Congress, the Senate and the House overwhelmingly passed resolutions during the week of January 5, 2009 in connection with Operation Cast Lead that supported Israel's right to defend itself (S.Res. 10 and H.Res. 34). Representative Dennis Kucinich, however, submitted a letter to then Secretary of State Condoleezza Rice arguing that "Israel's most recent attacks neither further internal security nor do they constitute 'legitimate' acts of self-defense." Office of Representative Dennis J. Kucinich, "Press Release: Israel May Be in Violation of Arms Export Control Act," January 6, 2009.

Jeff Stein, "Israel Won't Stop Spying on the U.S.," Newsweek, May 6, 2014; Calev Ben-David, "Israel Visa Flap With U.S. Stirs Up Spy Charges, Profiling Claim," Bloomberg, May 8, 2014.

The second case is that of Department of Defense analyst Lawrence Franklin, who pled guilty in 2006 to disclosing classified information to an Israeli diplomat and to two lobbyists from the American Israel Public Affairs Committee (AIPAC). The third case is that of Ben-Ami Kadish, who had worked at the U.S. Army's Armament Research, Development, and Engineering Center in Dover, New Jersey. Kadish pled guilty in 2009 to one count of conspiracy to act as an unregistered agent of Israel.

Tom Cohen, "27 years later, Jonathan Pollard case remains a diplomatic thorn," cnn.com, April 1, 2014.

For information on Israel's nuclear activities, see CRS Report R40439, Nuclear Weapons R&D Organizations in Nine Nations, coordinated by [author name scrubbed].

See footnote 32.

Eli Lake, "Secret U.S.-Israel Nuclear Accord in Jeopardy," Washington Times, May 6, 2009.

Barak Ravid, "Israel opts to stay vague on chemical arms policy in wake of Syria disarmament," haaretz.com, October 31, 2013.

Dan Williams, "Eyeing Arab ties, Israel to observe nuclear pact meeting," Reuters, April 26, 2015.

"U.S. blocks NPT conference statement over Israeli objections," haaretz.com, May 23, 2015.

According to the European Commission's Directorate General for Trade, for 2013 the countries of the European Union accounted for 30.9% of Israel's total trade volume, while the United States accounted for 18.6%. Document available at http://trade.ec.europa.eu/doclib/docs/2006/september/tradoc_113402.pdf.

Statistics on Israel's status relative to other U.S. trading partners compiled by the U.S. International Trade Commission, available at http://dataweb.usitc.gov/SCRIPTS/cy_m3_run.asp.

Statistics compiled by Foreign Trade Division, U.S. Census Bureau, available at http://www.census.gov/foreign-trade/balance/c5081.html.

CRS Report RL33222, U.S. Foreign Aid to Israel, by [author name scrubbed].

This appendix was co-authored with [author name scrubbed], Specialist in Energy Policy.

USGS, Assessment of Undiscovered Oil and Gas Resources of the Levant Basin Province, Eastern Mediterranean, March 2010.

The Leviathan field, located off Israel's northern coast, has an estimated resource base of 21.9 trillion cubic feet (tcf) of natural gas. Tamar holds approximately 10 tcf. Both fields were discovered by U.S.-based company Noble Energy. See Noble Energy's "Eastern Mediterranean" portal at http://www.nobleenergyinc.com/operations/international/eastern-mediterranean-128.html.

Cedigaz, Statistical Database, accessed on February 23, 2015. The imported amount was from Trinidad and Tobago, redirected cargos from Spain, and Nigeria. The imports arrived via a temporary floating regasification import terminal.

Hedy Cohen, "Regulators present Israel gas compromise to Delek, Noble," Globes, May 12, 2015.

Avi Bar-Eli and Zvi Zrahiya, "Kahlon drops natural gas hot potato, citing conflict of interest," haaretz.com, May 27, 2015.

In June 2013, Israel's government announced that it planned to dedicate 60% of gas produced in Israel to domestic consumption, leaving 40% for exports

"Israel's top court gives government 15 days to respond to appeal against gas exports," Platts, June 25, 2013, online.

John Reed, "Woodside backs out of $2.7 bn Israel gas project," Financial Times, May 21, 2014.

James Paton, "Woodside Scraps $2.6 Billion Israeli Gas Deal as Talks Fail," Bloomberg, May 21, 2014. Noble Energy and its Israeli partners in the Leviathan consortium have explored the possibility of building a liquefaction facility—possibly in Cyprus—to prepare Cypriot gas and Israeli gas piped to the facility for export to Europe and/or Asia in a cost effective way. It remains too early to determine the feasibility of such a project, although a recent downgrade to the gas reserves in Cyprus's offshore Aphrodite field may have decreased the viability or attractiveness of a liquefaction facility. In late June 2013, Cyprus and the Leviathan consortium signed a memorandum of understanding to build natural gas facilities for both domestic consumption and export. Although developments in early 2014 suggested that talks had not progressed on the initial understanding, they are ongoing while a joint venture between Eni (Italy) and Kogas (South Korea) is trying to find additional sources of Cypriot gas for possible liquefaction. "Cyprus to start LNG export terminal discussions with Eni/Kogas, Total," Platts, August 25, 2014.

For discussions of these issues, see Michael Hochberg, "Israel's Natural Gas Sector: A Regional Perspective," mei.edu, April 24, 2014; and Simon Henderson, Natural Gas Export Options for Israel and Cyprus, German Marshall Fund of the United States, September 2013.

Tom Pepper, "Partners in Israeli Gas Field Sign Deal with Palestinians," International Oil Daily, January 7, 2014.

A venture led by BG Group (formerly British Gas) discovered the Marine field in 2000. It has an estimated resource base of 1 tcf. Development of Marine could contribute to greater Palestinian economic and political self-sufficiency, perhaps freeing up Israeli energy resources for domestic consumption or export to other places. Simon Henderson, "Natural Gas in the Palestinian Authority: The Potential of the Gaza Marine Offshore Field," German Marshall Fund of the United States, March 2014. Reduced Palestinian dependence on Israel could either heighten or reduce Israeli-Palestinian tensions.

Shoshanna Solomon and Calev Ben-David, "Israel Sees Gas as Key to Transforming Mideast Relations," Bloomberg, October 14, 2014.

"Noble, Partners Sign Jordan Gas Deal," Oil Daily, February 20, 2014.

"Jordan said to suspend talks with Israel over huge gas deal," Times of Israel, January 4, 2015.

According to the U.S. Energy Information Administration, "Jordan is pursuing several pipeline deals, notably with Iraq, to help bolster its energy security. One proposal would send Iraqi oil from the area around Basra to the Jordanian port of Aqaba on the Red Sea. If constructed, the pipeline would initially carry up to [1 Mb/d] of oil, including more than 100,000 [b/d] available for use inside Jordan. The plan also calls for a natural gas pipeline to run along the same route as the oil pipeline, with up to 100 million cubic feet per day (MMcf/d) being allocated to help meet Jordanian demand."

John Reed, "Israel gas supply deals to Egypt and Jordan draw closer," Financial Times, May 21, 2014.

Royal Dutch Shell announced plans in 2015 to acquire BG Group.

Summer Said, "Egypt Would Approve BG's Israel Gas Deal If Local Demand is Met," wsj.com, July 7, 2014.

Ibid.

Whether the deal will involve the use of the pipeline that previously provided gas to Israel from Egypt—and fell prey to sabotage in the Sinai Peninsula on multiple occasions—is unclear, due to denials from the company that owns the pipeline. Sharon Udasin, "Eastern Mediterranean Gas: Egyptian pipeline not part of Tamar partners, Dolphinus gas deal," jpost.com, March 23, 2015.

"Fuelling Unhappiness," Economist, May 24, 2014.

Turkey downgraded its diplomatic relations with Israel in the aftermath of the so-called Gaza flotilla incident of May 2010. For more information, see footnote 110.

Solomon and Ben-David, op. cit.

See CRS Report R41368, Turkey: Background and U.S. Relations, by [author name scrubbed]. See also, e.g., Günther Jileki and Kemal Silay, "'Spawn of Israel': Erdogan's anti-Semitic obsessions," Ha'aretz, May 22, 2014.

This section was co-authored with [author name scrubbed], Specialist in Middle Eastern Affairs.

Tia Goldenberg, "Israel faces geopolitical tangle with natural gas," Daily Star (Lebanon), March 29, 2013.

The armistice line is not the final agreed border between Lebanon and Israel, but coastal points on the line appear likely to be incorporated into any future Lebanon-Israel border agreement.