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Israel: Background and U.S. Relations

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Israel: Background and U.S. Relations

June 1, 2015October 28, 2016 (RL33476) Jump to Main Text of Report

Contents

Summary

Since Israel's founding in 1948, successive U.S. Presidents and many Members of Congress have demonstrated a commitment to Israel's security and to close U.S.-Israel cooperation. Perceptions of shared democratic values and religious affinities have contributed to strong bilateral ties. The question of Israel's security regularly influences U.S. policy considerations regarding the Middle East, and Congress provides active oversight of executive branch dealings with Israel and other actors in the region. Israel is a leading recipient of U.S. foreign aid and a frequent purchaser of major U.S. weapons systems. By law, U.S. arms sales cannot adversely affect Israel's "qualitative military edge" over other countries in its region. The two countries signed a free trade agreement in 1985, and the United States is Israel's largest trading partner.

Israel has many regional security concerns, and aligning U.S. and Israeli policies to address these concerns has presented persistent challenges. In a dangerous and uncertain regional environment, Israel regularly seeks assurance that the United States will bolster its regional security standing and self-defense capabilities. A new U.S.-Israel memorandum of understanding will provide Israel with $38 million in military assistance from FY2019 to FY2028, subject to congressional approval. In addition to concerns over Iran's regional position that have increased despite or because of the 2015 international agreement on Iran's nuclear program, Israel's perceptions of security around its borders have changed since 2011 as several surrounding Arab countries have experienced political upheaval. Israel has shown concern about threats from Hezbollah and other non-state groups in ungoverned or minimally governed areas in Syria, Lebanon, and Egypt's Sinai Peninsula, as well as from Hamas and other Palestinian terrorist groups in the Gaza Strip.

Israel's political impasse with the Palestinians continues. Israel has militarily occupied the West Bank since the 1967 Arab-Israeli war, with the Palestinian Authority exercising limited self-rule in some areas since the mid-1990s. Israeli Prime Minister Binyamin Netanyahu's commitment to a two-state solution could affect U.S. and international diplomatic initiatives. The Palestinians have advanced diplomatic and legal initiatives in various international fora despite U.S. and Israeli concerns about increasing international "isolation" of Israel. Activities facilitated by successive Israeli governments have resulted in approximately 580,000 Israelis living in residential neighborhoods or "settlements" in the West Bank and East Jerusalem. These settlements are of disputed legality under international law. Israel considers all of Jerusalem to be the "eternal, undivided capital of Israel," but Palestinians claim a capital in East Jerusalem and some international actors advocate special political classification for the city or specific Muslim and Christian holy sites. The Gaza Strip presents its own set of complicated challenges. Israel withdrew its permanent military presence and its settlers from the Gaza Strip in 2005, but it still controls most access points.

Israel has a robust economy and a vibrant democracy, though how to incorporate Arab citizens into the state and society remains challenging. Since late 2015, Israeli-Palestinian violence centered in Jerusalem and the West Bank has stoked domestic and international debate about Israel's dedication to the rule of law on matters involving Palestinians, and about the openness of Israel's political sphere and civil society to varying viewpoints. Continuing development of offshore natural gas finds raises the prospect of a more energy-independent future, while economic debates focus largely on cost-of-living and inequality issues. Various leaders vie for public support by interweaving ideology with ethnic, religious, demographic, socioeconomic, and national security considerations. Netanyahu's current governing coalition includes various right-of-center and religious parties.

Israel: Background and U.S. Relations
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Introduction

U.S.-Israel defense, diplomatic, and economic cooperation has been close for decades. U.S. policymakers often consider Israel's security as they make policy choices in the regionMiddle East. Israel has relied on U.S. support for its defense posture, despite reported private and sometimes public disagreements between U.S. and Israeli officials on how to respond to and prioritize various security challenges. Congress provides active oversight of the executive branch's dealings with Israel. Some Members of Congress have criticized actions by the Obama Administration and previous U.S. Administrations for being insufficiently supportive of Israel, and occasionally have authorized and appropriated funding for programs benefitting Israel at a level exceeding that requested by the executive branch. Other Members oppose what they describe as U.S. support of Israel without sufficient scrutiny of Israel's actions.

U.S. approaches to a number of challenges in the Middle East have implications for Israel. For years, Israeli leaders have described Iran and its reported pursuit of a nuclear weapons capability as an imminent threat to Israeli security. Consequently, they have sought increasingly stringent measures from the international community intended to ensure that Iran's nuclear program is exclusively for peaceful purposes. Within this context, Israeli leaders have repeatedly hinted that absent a clear resolution of Iran's nuclear activity to their satisfaction, they may order the Israeli military to strike Iranian nuclear facilities.

Many Israeli officials also are concerned with the rise of Islamist political movements and threats posed by terrorist groups emanating from ongoing regional political turmoil. Israel has clashed with the Obama Administration over policy on Iran, which continues to be a top Israeli security concern. Israel has sought for years to stop Iran from pursuing a nuclear weapons capability. Prime Minister Netanyahu opposed the July 2015 international agreement on Iran's nuclear program (formally the "Joint Comprehensive Plan of Action," or JCPOA), but has acknowledged the need to adjust to a post-deal reality. The Obama Administration has attempted to reassure Israel that the United States remains committed to Israel's security. In September 2016, the two countries reached a new memorandum of understanding on security assistance that commits the United States to providing $38 billion in new aid over the 10 years from FY2019 to FY2028 (see "New Aid MOU" below). Israel has few means of influencing political outcomes in Egypt, Syria, Iraq, Lebanon, or Jordan, but internal developments in those states may also significantly affect Israeli security. Israel also remains threatened by rocket fire from Hamas and other terrorist groups in the Gaza Strip.

Additionally, since late 2015, several attacks by individual Palestinians (including a few by Arab citizens of Israel) have taken place against Jews in Israel, Jerusalem, and the West Bank. These attacks are related to the ongoing Israeli-Palestinian conflict. Political disputes continue over key issues including security parameters, Israel-West Bank borders, Jewish settlements, Palestinian refugees, and the status of Jerusalem. Hamas and other terrorist groups reportedly seek to use the tensions to spark wider conflict. Within and outside of Israel, observers vigorously debate whether Israeli officials and citizens will be able to curb either Palestinian attacks or the international criticism Israel faces regarding the various measures of control it exercises over Palestinians' lives. This debate proceeds in parallel with a larger debate about the future of Israel's democracy and its political and economic relations with the United States, Europe, and the rest of the world.

Continued failure by Israelis and Palestinians to make progress toward a negotiated solution could have a number of regional and global implications. Palestinian leaders support initiatives to advance theirsignificantly affect Israeli security. Instability in Egypt's Sinai Peninsula has already been used by militant groups—probably including Palestinian cells advocating global jihadism—for attacks on Israeli targets. At the same time, many large and small Israeli population centers remain threatened by rocket fire from Hamas and other terrorist groups in Gaza, as demonstrated by an Israel-Gaza conflict in the summer of 2014.

Israel's disputes continue with the Palestine Liberation Organization (PLO) over the terms of a potential peace agreement on "final-status issues" including security parameters, borders, Jewish settlements, Palestinian refugees, and the status of Jerusalem. Partly as a result of active U.S. efforts, Israel and the PLO started a new round of direct negotiations in the summer of 2013, but this round ended unsuccessfully in April 2014. In June 2014, the leading PLO faction Fatah formed a new Palestinian Authority (PA) government pursuant to an agreement with the Sunni Islamist group Hamas (a U.S.-designated terrorist organization) in an attempt to end seven years of divided rule in parts of the West Bank and in Gaza. However, various developments, including Hamas's continued de facto control over Gaza, have raised doubts regarding the viability of unified PA rule and current Israeli, Palestinian, and international approaches toward Gaza.

Failure by Israelis and Palestinians to resume negotiations could have a number of regional and global implications. Palestinian leaders have resumed international initiatives to advance Palestinian statehood claims and appear to be encouraging or taking advantage of international legal and economic pressure on Israel in an effort to improve the Palestinian position vis-à-vis Israel. Israeli actions regarding security arrangements and constructionconstruction (including of Jewish settlements or neighborhoods) and security measures in the West Bank and East Jerusalem could also have implications for final-status issues. Such matters attract significant interest within the United States and among a number of other international actors. Periodic instances of unrest and violence among Israelis and Palestinians have the potential to exacerbate existing disputes.

Figure 1. Israel: Map and Basic Facts

Current U.S. and international efforts to preserve the viability of a negotiated "two-state solution" attract skepticism because of regional turmoil and domestic reluctance among key Israeli and Palestinian leaders and constituencies to contemplate political or territorial concessions. As a result, Western leaders are left wondering if and how they can improve diplomatic prospects. Meanwhile, Israelis debate whether their leaders should participate in international initiatives, advance their own diplomatic proposals, act unilaterally, or manage the "status quo."

Figure 1. Israel: Map and Basic Facts

Sources: Graphic created by CRS. Map boundaries and information generated by [author name scrubbed] using Department of State Boundaries (2011); Esri (2013); the National Geospatial-Intelligence Agency GeoNames Database (2015); DeLorme (2014). Fact information from CIA, The World Factbook; Economist Intelligence Unit; IMF World Outlook Database; Israel Central Bureau of Statistics. All numbers are estimates and as of 2016 unless specified.

Notes: UNDOF: United Nations Disengagement Observer Force. The West Bank is Israeli-administered with current status subject to the 1995 Israeli-Palestinian Interim Agreement; permanent status to be determined through further negotiation. The status of the Gaza Strip is a final status issue to be resolved through negotiations. Israel proclaimed Jerusalem as its capital in 1950, but the United States, like nearly all other countries, retains its embassy in Tel Aviv-Yafo. Boundary representation is not necessarily authoritative.

Country Background

Historical Overview

The start of a quest for a modern Jewish homeland can be traced to the publication of Theodor Herzl's The Jewish State in 1896. Herzl was inspired by the concept of nationalism that had become popular among various European peoples in the 19th century, and was also motivated by his perception of European anti-Semitism. The following year, Herzl described his vision at the first Zionist Congress, which encouraged Jewish settlement in Palestine, the territory that had included the Biblical home of the Jews but was then part of the Ottoman Empire. During World War I, the British government issued the Balfour Declaration in 1917, supporting the "establishment in Palestine of a national home for the Jewish people." Palestine became a British Mandate after the war and British officials simultaneously encouraged the national aspirations of the Arab majority in Palestine for eventual self-determination, insisting that its promises to Jews and Arabs did not conflict. Jews immigrated to Palestine in ever greater numbers during the Mandate period, and tension between Arabs and Jews and between each group and the British increased, leading to periodic clashes. Following World War II, the plight of Jewish survivors of the Holocaust gave the demand for a Jewish home added poignancy and urgency, while Arabs across the Middle East simultaneously demanded self-determination and independence from European colonial powers.

In 1947, the United Nations General Assembly developed a partition plan (Resolution 181) to divide Palestine into Jewish and Arab states, proposing U.N. trusteeship for Jerusalem and some surrounding areas. The leadership of the Jewish Yishuv (or polity) welcomed the plan because of the legitimacy they asserted that it conferred on the Jews' claims in Palestine despite their small numbers, while the Palestinian Arab leadership and the League of Arab States (Arab League) rejected the plan, insisting both that the specific partition proposed and the entire concept of partition were unfair given Palestine's Arab majority. Debate on this question prefigured current debate about whether it is possible to have a state that both provides a secure Jewish homeland and is governed in accordance with democratic values and the principle of self-determination.

After several months of civil conflict between Jews and Arabs, Britain officially ended its Mandate on May 14, 1948, at which point the state of Israel proclaimed its independence and was immediately invaded by Arab armies. During and after the conflict, roughly 700,000 Palestinians were driven or fled from their homes, an occurrence Palestinians call the nakba ("catastrophe").1 Many became internationally designated refugees after ending up either in areas of Mandate-era Palestine controlled by Jordan (the West Bank) or Egypt (the Gaza Strip), or in nearby Arab states. Palestinians remaining in Israel became Israeli citizens.

The conflict ended with armistice agreements between Israel and its neighboring Arab states: Egypt, Jordan, Lebanon, and Syria. The territory controlled by Israel within these 1949-1950 armistice lines is roughly the size of New Jersey. Israel has engaged in further armed conflict with some or all of its neighbors on a number of occasions since then—most notably in 1956, 1967, 1973, and 1982. Since the 1950s, Israel has also dealt with the threat of Palestinian guerrilla or terrorist attacks. In 1979, Israel concluded a peace treaty with Egypt, followed in 1994 by a peace treaty with Jordan, thus making another multi-front war less likely. However, as discussed throughout the report, major security challenges persist from Iran and groups allied with it. Additionally, developments in Arab states and in the ongoing Israeli-Palestinian conflict further complicate Israel's regional position.

Demographic and Political Changes

Israel's demographic profile has evolved in a way that appears to be affecting its political orientation and societal debatesPolitical and Societal Evolution Israeli society and politics have evolved over time. In the first decades following its founding, Israeli society was dominated by secular Ashkenazi (Eastern European) Jews from Eastern Europe who constituted the large majority of 19th- and early 20th-century Zionist immigrants. Many leaders from these immigrant communities sought to build a country dedicated to Western liberal and communitarian values. From 1948 to 1977, the social democratic Mapai/Labor movement led Israeli governing coalitions.

The 1977 electoral victory of Menachem Begin's more nationalistic Likud party helped boost the influence of previously marginalized groups, particularly Mizrahi (Eastern) Jews who had immigrated to Israel from Arab countries and Iran. This electoral result came at a time when questions regarding the future of territories that Israel's military occupied during the 1967 Arab-Israeli War had become increasingly central to political life. Begin and his successor in Likud Yitzhak Shamir helped drive the political agenda over the following 15 years. Although Labor under Yitzhak Rabin later initiated the Oslo peace process with the Palestinians, its political momentum was slowed and reversed after Rabin's assassination in 1995.

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 statemake it difficult for Israel to remain both a Jewish and a democratic state while ruling over the Palestinians gained traction among many Israelis. 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 communitiesThe enduring appeal of Netanyahu and right-of-center parties to Israeli voters in recent years may stem from a number of factors, including:

  • Some Israelis' assertions that Palestinians have rejected peace and that Israeli military withdrawals from southern Lebanon (in 2000) and the Gaza Strip (in 2005) emboldened Hezbollah and Hamas and contributed to subsequent conflict.
  • The influence of distinct religious, ethnic, or ideological groups, such as Russian speakers who emigrated from the former Soviet Union in the 1990s, and citizens aligned with the "national religious" (modern Orthodox) movement. Both groups skew toward the political right and include many of the biggest supporters of settlements.

One commentator has said that Israelis keep returning Netanyahu to office "precisely because he is risk averse: no needless wars, but no ambitious peace plans either."3

Nevertheless, Israeli politics remain informed by complex considerations, with governing majorities only possible via compromise with diverse groups. For example, the two largest growing demographic groups in Israel are ultra-Orthodox Jews (Haredim) and Arab Israelis. The two main Haredi parties in Israel are members of Netanyahu's current ruling coalition, and are generally aligned with the other right-of-center parties on national security issues. However, their support for Netanyahu's government is predicated on promises of state support for traditional Haredi educational and lifestyle choices, which are largely anathema to secular Israeli middle class voters. Many of these voters would prefer that government resources be used to defray Israel's relatively high cost of living.

Arab Israelis, who make up nearly 20% of the population, remain largely estranged from Jewish citizens. Arab citizens generally identify more closely with left-of-center parties. However, the general reluctance of Jewish Israelis to include Arab parties in government increases the difficulty for left-of-center parties in forming a coalition.

Government and Politics

Overview

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 years2014, however, the Knesset has somewhat tightened the conditions for bringing down a government.

Primer on Israeli Electoral Process and Government-Building7

4

Elections to Israel's 120-seat Knesset are direct, secret, and proportional based on a party list system, with the entire country constituting a single electoral district. All Israeli citizens age 18 and older may vote. Turnout in elections since 2001 has ranged between 62% and 72% of registered voters (before that it generally ranged between 77% and 80%). Elections must be held at least every four years, but are often held earlier due to difficulties in holding coalitions together. A Central Elections Committee is responsible for conducting and supervising the elections. The committee includes representatives from parties in the current Knesset and is headed by a Supreme Court justice.

National laws provide parameters for candidate eligibility, general elections, and party primaries—including specific conditions and limitations on campaign contributions and public financing for parties.85 Since 2007, a "cooling-off law" requires that senior Israeli military officers wait at least three years before entering civilian politics.96

Following elections, the task of forming a government is given by Israel's president to the Knesset member he/she believes has the best chance to form a government as prime minister. The would-be prime minister has 28 days to assemble a majority coalition, and the president can extend this period for an additional 14 days. The government and its ministers are installed following a vote of confidence by at least 61 Knesset members. Thereafter, the ministers determine the government's course of action on domestic issues, while military and national security action are directed through a "security cabinet" (formally known as the Ministerial Committee on Defense) consisting of a group of key ministers—some whose membership is set by law, others who are appointed by the prime minister—who number no more than half of all cabinet ministers.10

7

Israeli Government Following March 2015 Elections

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

Figure 2. Israeli Knesset

(Configuration by party)

Source: Economist.

Netanyahu announced the formation of a new government on May 6. The government includes right-leaning and Haredi parties constituting a narrow 61-59 Knesset majority—a coalition potentially susceptible to breakdown given the parties' differing priorities.15 Finance Minister Moshe Kahlon, a former Likud member known for helping to liberalize the mobile phone market as communications minister from 2009-2013, heads Kulanu, a new party that calls for widespread socioeconomic reform to address popular concerns regarding cost-of-living and inequality issues.16 Despite losing four seats from its previous Knesset representation and the housing ministry, Naftali Bennett's Ha'bayit Ha'Yehudi appears to have multiple opportunities to advance the interests of West Bank settlers via its control of the justice, education, and agriculture ministries, as well as the Israeli military's civil administration in the West Bank.17 Haredi parties Shas and United Torah Judaism (UTJ) appear to have elicited promises from Netanyahu to increase welfare payments to their constituencies and not to enforce recent legislation aimed at eliminating longtime exemptions for Haredi youth from military conscription. The two parties also lead the economy and health ministries, respectively, with Shas head Aryeh Deri in government for the first time since his 2000 conviction for taking bribes while interior minister.18 Likud's Moshe Ya'alon remains Israel's defense minister. For descriptions of the parties in the Knesset and their respective leaders, see Appendix B.

Current Government and Major Issues

Israeli Prime Minister Binyamin Netanyahu presides over a coalition government that includes six parties generally characterized as right of center. In May 2016, the Yisrael Beiteinu party joined the government, and its leader Avigdor Lieberman became Israel's defense minister. Lieberman replaced Moshe Ya'alon as defense minister. Ya'alon has since expressed his intent to challenge Netanyahu in the next national elections, which are due no later than 2019.

Table 1. Israeli Security Cabinet Members

Member

Party

Ministerial Position(s)

Previous Knesset Terms

Binyamin Netanyahu

Likud

Prime Minister

Minister of Foreign Affairs

8

Moshe Ya'alon

Avigdor Lieberman

Likud

Yisrael Beiteinu

Minister of Defense

2

5 (resigned Knesset seat in May 2016)

Moshe Kahlon

Kulanu

Minister of Finance

3

Naftali Bennett

Ha'bayit Ha'Yehudi

Minister of Education

1

Ayelet Shaked

Ha'bayit Ha'Yehudi

Minister of Justice

1

Gilad Erdan

Likud

Minister of Public Security

Minister of Strategic Affairs

4

Aryeh Deri

Shas

Minister of Economy

Minister of Information

3

4

Silvan Shalom

Aryeh Deri

Likud

Shas

Minister of Interior

7

3

Yisrael Katz

Likud

Minister of Transportation

Minister of Intelligence and Atomic Energy

6

Yuval Steinitz

Yoav Galant

Likud

Kulanu

Minister of Infrastructure, Energy, and Water

Construction and Housing

5

0

Ze'ev Elkin

Sofa Landver

Likud

Yisrael Beiteinu

Minister of Immigrant Absorption

3

6

The varying interests of the coalition's members and some intra-party rifts—particularly in Netanyahu's Likud party8—contribute to difficulties in building consensus on the following issues:

  • How to address an interrelated set of concerns relating to national security, freedom of expression, competing ideologies, and international influence; and
  • How to promote macroeconomic strength while addressing popular concerns regarding economic inequality and cost of living.

Netanyahu's government has faced considerable challenges in connection with Israeli-Palestinian issues and their international ripple effects. Such challenges take place partly within an environment where Israeli prime ministers confront considerable difficulty in balancing fractious coalitions. Speculation continues regarding the possibility that Netanyahu might seek to strengthen his hand vis-à-vis individual coalition partners by bringing in the center-left Zionist Union (featuring Labor and Ha'tnua), or some portion of its Knesset members.9 Additionally, Netanyahu's position could be imperiled if an ongoing attorney general's corruption probe leads to a formal criminal investigation and possibly an indictment.10

Debates about trends in Israeli society have pitted some right-of-center political leaders—including Netanyahu in some instances—against top Israeli defense and military officials. Some members of the security establishment have criticized what they portray as unjustifiable force by Israeli security personnel, and have discerned signs of "intolerance" and "brutalization" in Israeli society.11 In some cases of alleged misconduct by personnel, right-leaning political figures have countered criticism proffered against them. Such divisions between defense officials and some government leaders was exacerbated in the aftermath of a March 2016 shooting of a wounded, prostrate Palestinian attacker by an Israeli soldier in the West Bank.12 Upon his resignation in May, former defense minister Moshe Ya'alon asserted that manifestations of extremism in Israel and the Likud party are "seeping into the army."13 The previous defense minister, Ehud Barak (who is also a former prime minister) has made similar statements about increasing signs of extremism in Israeli society and politics.14

The Israeli public and international observers vigorously debated two Netanyahu-supported bills in the Knesset that passed in July 2016. One law requires non-governmental organizations (NGOs) receiving more than half their funding from foreign governments to officially declare the funding sources, and appears to disproportionately affect left-leaning organizations.15 In a July 12 daily press briefing, a State Department spokesperson raised concerns about the "chilling effect that this new law could have on NGO activities." The second law amended Israel's Basic Law to allow a Knesset supermajority to expel a Knesset member if the member incites racism or supports violence against the state.16 It appears to be tailored to address concerns among several lawmakers regarding Arab Knesset members.17

Note: Steinitz and Elkin will reportedly rotate within the security cabinet.

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

The New Government's Agenda20

A number of controversial initiatives, some of which were a subject of contention within the previous government, appear to be on the new government's agenda. They include:

  • A bill enshrining Israel as the "nation-state of the Jewish people," which opponents assert would undermine Israel's commitment to democratic principles vis-à-vis its Arab population
  • A bill to restrict foreign donations to non-governmental organizations (NGOs) absent advance Israeli government approval, aimed apparently at cutting "the lifeline of many left wing and civil rights organizations that rely heavily on European funding."21
  • Measures to make it harder for the Supreme Court to overrule legislation, and easier for the Knesset to override any invalidation, along with measures to have lawmakers play a larger role in selecting Israeli judges.
  • An agreement to make proposals for "regularizing" settlement outposts in the West Bank that have not been authorized under Israeli law.

Although the government's narrow majority may complicate its efforts to pass legislation, these initiatives' prospects have been boosted by the naming of Ayelet Shaked of Ha'bayit Ha'Yehudi as justice minister.22 The justice minister heads the ministerial committee on legislation that decides whether and when bills are allowed onto the Knesset floor. However, Netanyahu has reportedly arranged for one of his loyalists on the committee to be empowered to veto legislation that could "embarrass Netanyahu by pitting him against the judicial system or the international community."23

Finance Minister Kahlon, who has indicated opposition to many of these initiatives, has the ability to block them, but observers debate whether his willingness to do so might be tempered by his efforts to obtain coalition support for his socioeconomic reform proposals.24

Economy

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.

Israel's economy appears to be experiencing a moderate slowdown after years of sustained, robust growth. Since 2012, annual growth has hovered between 2.8% and 3.2%, compared to 5.8% in 2010 and 4.2% in 2011.25 The slowdown has taken place largely as a result of economic downturns in Israel's largest export markets in Europe, North America, and Chinais experiencing a period of moderate growth (between 2.5% and 3.2% annually since 2012) following a time of generally more robust growth (averaging 4.5% annually from 2004 to 2011).18 Slower economies in major Israeli trading partners—Europe, North America, and China—may account for the change to some extent. While International Monetary Fund (IMF) growth projections for Israel remain close to 3% over the next five years,2619 the Economist Intelligence Unit projects growth to increase steadily to over 5% duringapproaching 4% over much of that time due to expectations of greater domestic consumption and exports, and anticipated new income from recently discovered offshore natural gas deposits (see Appendix C).27

When Prime Minister Netanyahu was finance minister in the early 2000s, the government attempted to liberalize the economy by controlling government spending, reducing taxes, and privatizing state enterprises. The chronic budget deficit decreased, while the country's international credit rating was raised, enabling a drop in interest rates. However, Netanyahu's critics suggest that cuts in social spending widened income inequality and shrank the Israeli middle class.28 A 2015 Organisation for Economic Cooperation and Development (OECD) report found that Israel has the fifth highest level of income inequality among the 34 OECD member states.29 Another 2015 OECD report cited a modest increase in employment figures among historically poorer Haredi and Arab Israeli population sectors, while recommending that Israel adopt various measures to promote further growth in this area and to bolster industrial competitiveness.30

Israel's Security Concerns

General Threat Perceptions

Prime Minister Netanyahu and his government are occupied with a range of regional security concerns stemming from Iran, turmoil in neighboring Arab states (especially Syria, Iraq, Lebanon, and Egypt), and Israel's decades-long conflict with the Palestinians. Although Israel maintains conventional military superiority relative to its neighbors and the Palestinians, it is unclear how shifts in regional order and evolving asymmetric threats may affect Israel's capabilities to project military strength, deter attack, and defend its population and borders. 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 key regional issues.

Some unconventional threats to Israel are seen to have been reduced because of factors such as heightened security measures vis-à-vis Palestinians; missile defense systems; and reported cyber capabilities. From a physical security standpoint, Israel has proposed and partially constructed a national border fence network of steel barricades (accompanied by watch towers, patrol roads, intelligence centers, and military brigades), which is presumably designed to minimize militant infiltration, illegal immigration, and smuggling from Egypt, Syria, Lebanon, and parts of Jordan.31

U.S. pursuit of diplomacy with Iran appears to exacerbate Israel's anxiety over the extent to which it can rely on its geographically distant superpower partner to actively thwart potential threats Israel faces, and to do so in the manner Israel's government prefers. This concern is attributable in part to the argument some Israelis and others have made that the level and nature of influence the United States has in the Middle East has been reduced, due to a number of political and economic factors. Others counter that substantial U.S. military assets remain deployed in the region, and that continued U.S. commitment to Israel (and other regional allies) has been reiterated by U.S. officials and reinforced through tangible means such as aid, arms sales, and missile defense cooperation. Debate continues among Israelis over the urgency of a political resolution to Israel's disputes with the Palestinians, as well as the potential regional and international consequences—including possibly increased political and economic "isolation"—if no resolution occurs.

Challenges from Iran and Arab Neighbors

Over the 42 years since the last major Arab-Israeli war in 1973offshore natural gas deposits.20 For information on prospective natural gas exports, see CRS Report R44591, Natural Gas Discoveries in the Eastern Mediterranean, by [author name scrubbed].

Although Israel's overall macroeconomic profile and fiscal position appears positive, the country has one of the highest income inequality levels within the 34-country Organisation of Economic Cooperation and Development (OECD).21 This inequality particularly affects Arab Israelis and Israeli Haredim (ultra-Orthodox Jews).22

Israeli Security Challenges

Israeli leaders and numerous other observers publicly identify Iran and two of its non-state allies—Hezbollah in Lebanon23 and Hamas in the Gaza Strip—as particularly significant security threats to Israel. Other threats or potential threats include Palestinian attacks emanating from the West Bank and Jerusalem and concerns about terrorist groups operating near Israel's borders with Syria and Egypt.24 At the same time, at least one Israeli intelligence estimate was reported to assess that recent changes and turmoil in the Middle East may in some ways have improved Israel's strategic posture.25

Strategic and Military Profile For decades, Israel has relied on the following three advantages—all either explicitly or implicitly backed by the United States—to remove or minimize potential threats to its security and existence:

  • Overwhelming regional conventional military superiority;
  • Formally ambiguousUndeclared but universally presumed regional nuclear weapons exclusivity;3226 and
  • De jure or de facto arrangements or relations with the authoritarian leaders of its Arab state neighbors aimed at preventing interstate conflict.
  • According to estimates from IHS Jane's, Israel's military features total active duty manpower across the army, navy, and air force of approximately 180,000, plus 445,000 in reserve—numbers aided by mandatory conscription for most young Jewish Israeli men and women, followed by extended reserve duty. In addition to its highly developed conventional equipment and capabilities, including a number of missile defense platforms, Israel is widely presumed to have an unacknowledged nuclear weapons arsenal that might be deployable via aircraft, submarine, and ground-based missiles.27 Additionally, Israel reportedly has sophisticated cyber defense and warfare capabilities. Its overall annual defense budget is approximately $13.8 billion, constituting about 4.7% of Israel's total gross domestic product (GDP).28

    Although Israel maintains conventional military superiority relative to its neighbors and the Palestinians, it is unclear how shifts in regional order and evolving asymmetric threats may affect Israel's capabilities to project military strength, deter attack, and defend its population and borders. Some unconventional threats to Israel are seen to have been reduced because of factors such as heightened security measures vis-à-vis Palestinians; missile defense systems; and reported cyber capabilities. 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 key regional issues.

    Israel has a robust homeland security system featuring sophisticated early warning practices, a number of significant measures in major public areas such as airports, and reinforced rooms or shelters that are engineered to withstand explosions in most of the country's buildings. Israel has also proposed and partially constructed a national border fence network of steel barricades (accompanied by watch towers, patrol roads, intelligence centers, and military brigades), which is designed to minimize militant infiltration, illegal immigration, and smuggling from Egypt, Syria, Lebanon, and parts of Jordan.29 After the Iran Nuclear Deal

    Israeli politicians and security officials have expressed a range of opinions regarding the JCPOA. Many Israeli leaders and observers indicate concern that the nuclear deal and its implementation is facilitating greater Iranian influence in the Middle East and emboldening Iran and its allies to test Israel's political and military capacities for deterrence. Some leaders, such as Prime Minister Binyamin Netanyahu, asserted at the time that the JCPOA was signed that it also legitimized Iran's aspirations to be a "nuclear threshold" state.30

    Yet, some within Israel's security establishment have identified positive aspects in the JCPOA's time-specific limits or rollbacks on Iran's ability to produce fissile material.31 Lieutenant General Gadi Eizenkot, the Israel Defense Forces chief of staff, said in January 2016, "The deal has actually removed the most serious danger to Israel's existence for the foreseeable future and greatly reduced the threat over the longer term."32 Analysts writing in an Israeli strategic affairs journal asserted in April 2016 that "Israel can undertake not to attack Iran as long as there is no violation of the terms of the JCPOA."33 Iran has continued to develop and test ballistic missiles, leading to some U.S. sanctions,34 while Israeli calls for more concerted international action arguably lack enforcement mechanisms.35

    A number of post-JCPOA developments may affect Israel's "qualitative military edge" (QME) over regional threats, including

    • The prospect of greater Iranian capacity to affect the regional balance of power given its renewed global economic connectivity.36
    • An increase in U.S. arms sales to Arab Gulf states in an effort to reassure them.37
    • Russia's decision to deliver on a long-delayed agreement to provide Iran with an upgraded air defense system known as the S-300.38
    Regional Threats from Hezbollah, Syria, and Sunni Jihadists

    Deterrence between Israel and Iran's ally Hezbollah is based on various military and political factors, and has largely held since a major Israel-Hezbollah conflict in the summer of 2006. A number of regional developments may affect Israel's ability to deter Hezbollah in the future, including dynamics involving Lebanon, Syria, and U.S.-Israel closeness and cooperation.39

    At various times during the conflict in Syria, Israel has reportedly fired on targets in Syria or Lebanon in response to attack or threats of attack, or in attempts to prevent arms transfers to Hezbollah in Lebanon.40 In February 2016, Israeli Prime Minister Netanyahu said:

    We will not agree to the supply of advanced weaponry to Hezbollah from Syria and Lebanon. We will not agree to the creation of a second terror front on the Golan Heights. These are the red lines that we have set and they remain the red lines of the State of Israel.41

    However, Israel's ability to operate in or around Syrian airspace appears to have become more dependent on Russia since it became directly involved in Syria in the fall of 2015. Israel and Russia initially established a joint mechanism for preventing misunderstandings,42 but Russia's reported deployment of advanced S-300 and S-400 air defense systems in Syria could complicate future Israeli efforts to prevent or mitigate the supply of arms to Hezbollah via Syrian territory.43 In July 2016, a Russian drone aircraft reportedly crossed into Israeli airspace by mistake and was fired upon by Israeli Patriot and air-to-air missiles before safely returning to Syria.44 At least one incident in which Syria reportedly fired on Israeli aircraft has driven some speculation about possible unintended consequences of Russia's apparent emboldenment of Syria.45

    Israeli officials have sought to draw attention to Hezbollah's weapons buildup—including reported upgrades to the range and precision of its projectiles—and its alleged use of Lebanese civilian areas as strongholds.46 In highlighting these issues, Israel may be aiming to bolster the credibility of its threat of massive retaliation against a Hezbollah attack, at least partly to spur key international actors to work toward preventing or delaying conflict.47 Observers debate the extent to which Hezbollah's involvement in the Syrian conflict in support of the Asad regime has weakened or strengthened the group, as well as whether Hezbollah's domestic profile and the profusion of international and non-state actors in the region make near-term conflict with Israel more or less likely.48

    Sunni Salafi-jihadist activity in the region since 2014—particularly involving the Islamic State organization (IS, also known as ISIS/ISIL, or by the Arabic acronym Da'esh)—has also deepened Israeli concerns regarding Israel's border security49 and the security of neighboring Jordan. Israel is constructing a security barrier along its border with Jordan that is similar in nature to projects undertaken on its other frontiers.50 Israeli security officials additionally monitor groups and individuals in the neighboring Gaza Strip and (Egypt's) Sinai Peninsula who claim allegiance to or inspiration from Salafi-jihadists,51 and Israeli leaders have taken note of incidents in Europe since 2014 in which extremists have specifically targeted Jews (including Israeli citizens).52 Since late 2015, some IS leaders or associated groups have issued explicit threats against Israel and/or Jews,53 though how that translates to operational capacity and concerted effort to direct or inspire attacks against Israeli targets is less clear.54

    Egypt

    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 since his July 2013 military-backed ouster of Morsi. 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 for which the Sinai Province of the Islamic State (SP, formerly known as Ansar Beit al Maqdis) claimed credit, Egypt's military created a territorial buffer zone between Sinai and Gaza.55

    More broadly, significant Egyptian 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.56 However, SP and other militant groups continue to threaten Israel along with domestic targets and foreign peacekeepers and tourists.57 Israel has actively sought continued U.S. and international support for Egypt since the July 2013 leadership change, and Egypt still plays a role in political mediation between Israel and Palestinians (including Hamas) and among competing Palestinian factions.

    Hamas and
  • De jure or de facto arrangements or relations with the authoritarian leaders of its Arab state neighbors aimed at preventing interstate conflict.

Although, as stated above, Israel's conventional military advantages are clear, the other two advantages listed above face the following strategic challenges:

  • Iranian Nuclear Challenge. Iran's possible achievement of a nuclear weapons capability could worsen security dilemmas. Israeli leaders have asserted that even if Iran does not use, intend to use, or even manufacture a nuclear weapon, its mere capacity to do so will increase its deterrence by raising the potential costs Israel and others would incur by acting against it or its allies (i.e., Hezbollah and various Palestinian militant groups). The resulting intimidation could lead Arab Gulf states to adopt more quiescent or pro-Iranian policies or to pursue nuclear capabilities of their own. In turn, this could open the way for increased Iranian influence and/or nuclear proliferation throughout the region that Prime Minister Netanyahu says would pose a "grave danger" to Israel.33
  • Instability and Terrorism from Ungoverned Spaces. Security vacuums have spread near Israel's borders in Syria, Lebanon, Egypt's Sinai Peninsula, Iraq, and Libya. These areas host or could attract terrorists, weapons traffickers, criminal networks, refugees, and migrants, and thus contribute to trends that appear to threaten Israeli security. Such trends may gain new momentum in light of inroads made by the Islamic State organization (or IS, also known as ISIS or ISIL) in Syria and Iraq and the influence these developments have had elsewhere in the region. The triad of (i) country-specific and region-wide anti-Israel narratives, (ii) political and religious constructs, and (iii) media platforms have the potential to magnify the impact such trends could have in undermining Israeli security.

Israeli planners and decision makers have scrambled to determine how to properly address these potential threats by recalibrating resource allocations, military postures, and regional and international political activities.

Iran34

For years, Israeli leaders have described Iran and its reported pursuit of a nuclear weapons capability35 as an imminent threat, though there are a range of views among Israeli officials and analysts regarding how to address the threat and the potential implications it has for Israel's security and its international relationships.36 Iranian leaders insist that Iran's nuclear program is solely for civilian purposes.

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

Syria, Lebanon, and Iraq51

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.

Egypt61

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.

Rocket Threat from Lebanon and Gaza

Major Israel-Hamas Conflicts Since 2008

December 2008-January 2009: Israeli code name "Operation Cast Lead"

Three-week duration, first meaningful display of Palestinians' Iranian-origin rockets, Israeli air strikes and ground offensive

Political context: Impending leadership transitions in Israel and United States; struggling Israeli-Palestinian peace talks (Annapolis process)

Fatalities: More than 1,100 (possibly more than 1,400) Palestinians; 13 Israelis (three3 civilians)

November 2012: "Operation Pillar of Defense (or Cloud)"

Eight-day duration, Palestinian projectiles of greater range and variety, Israeli airstrikes, prominent role for Iron Dome

Political context: Widespread Arab political change, including rise of Muslim Brotherhood to power in Egypt; three months before Israeli elections

Fatalities: More than 100 Palestinians, six6 Israelis (four4 civilians)

July-August 2014: "Operation Protective Edge/Mighty Cliff"

About 50-day duration, Palestinian projectiles of greater range and variety, Israeli air strikes and ground offensive, extensive Palestinian use of and Israeli countermeasures against tunnels, prominent role for Iron Dome

Political context: Shortly after (1) unsuccessful round of Israeli-Palestinian peace talks, (2) PA consensus government formation and end of Hamas's formal responsibilities for governing Gaza, (3) prominent youth killings

Fatalities: More than 2,100 Palestinians, 71 Israelis (five5 civilians), and one1 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.6558 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 thea summer 2014 conflict haswas 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 2012summer 2014 conflict was the third major conflict between Israel and Hamas (along with other Palestinian militants) since the end of 2008. 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.

The Palestinian Issue and Possible Israeli Options

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

Concerns Regarding International Isolation and Economic Effects

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

International Political and Legal Initiatives

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.

The Boycott, Divestment, and Sanctions (BDS) Movement

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

Some Members of Congress argue that the BDS movement is discriminatory and are seeking legislative options to limit its influence. For example, a bill introduced in February 2015 (H.R. 825, United States-Israel Trade and Commercial Enhancement Act) would, among other things, discourage prospective U.S. trade partners from engaging in "commercial discrimination" against Israel and require executive branch reports on politically motivated instances of BDS acts.94 At least two U.S. states have passed legislative measures or resolutions aimed at countering or criticizing BDS measures.95

Relations with Europe and Other Countries

Political Overview

In recent years, European countries and countries in other regions such as Latin America have become increasingly critical of Israeli actions vis-à-vis the Palestinians. Developments in Europe formally or symbolically providing greater recognition of Palestinian statehood may also be linked to European countries' stated concerns regarding Israel's policies. In the fall of 2014, Sweden became the first Western European country to formally recognize Palestinian statehood, the Vatican followed suit in May 2015, and nonbinding resolutions have been passed in houses of parliament in major Western European countries such as the United Kingdom, France, and Spain calling on those countries' governments to do the same. In December 2014, the European Parliament passed a resolution expressing support in principle for Palestinian statehood. According to one Israeli media report:

For the past several years Europe has been increasingly ambivalent about Israel. On the one hand there is a genuine desire to work with Israel, a useful trading partner with state-of-the-art technology and science; on the other, a predisposition to use economic and diplomatic clout to express displeasure at the continuing occupation. The Europeans don't want to lose Israel; but they do want to press it to end what they see as an illegal, immoral, and destabilizing status quo. After the collapse of the American-led peace process and in the new post-Gaza reality, Europe is looking to strike a more effective balance [between engagement and pressure].96

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.

Israeli leaders have also manifested concern over a December 2014 ruling by the General Court of the EU that Hamas should be removed from the EU's common list of designated terrorist organizations on procedural grounds related to the decision-making process used in adding the group's military wing to the list in 2001.98 The EU External Action Service responded that the ruling was not a political or substantive decision made by EU governments, and that restrictive measures against Hamas will remain in place as it appeals the court's decision. Israel welcomed news of the appeal.99

Various media outlets have questioned whether manifestations of European support for the Palestinian cause and criticism of Israel, which some Jews reportedly describe as blurring "distinctions between being anti-Israel and anti-Jew," are cyclical episodes tied to specific events like the summer 2014 Israel-Gaza conflict or are "undermining the postwar consensus to root out anti-Semitism."100 Following terrorist killings at Jewish sites in Paris and Copenhagen in early 2015 (mentioned above), Prime Minister Netanyahu exhorted European Jews to immigrate to Israel. However, one commentator, in arguing that significant emigration from Europe is unlikely, has asserted that "while European democracies are not without their hatreds, ethnic frictions and sociopaths (human beings live there), it is completely ahistorical to believe they are failing Jews, or any other group, in ways that are reminiscent of the 1930s and '40s."101 Another observer has written that Jews who emigrate from Europe may not be seeking "freedom from violence so much as the ability to live an openly Jewish life in a way that is becoming harder in Europe."102

Possible Impact on Israel-Europe Economic Cooperation

Prospects of reduced EU-Israel economic cooperation fueled statements of concern in early 2014 by then Israeli Finance Minister Yair Lapid, given that the EU is Israel's largest trading partner.103 The EU issued guidelines in July 2013 prohibiting funding to Israeli organizations in West Bank, East Jerusalem, or Golan Heights settlements, and only permitted Israel's inclusion in its Horizon 2020 research and innovation program in late 2013 after Israel agreed that funding would not go to organizations operating in settlements. Following the unsuccessful end of the most recent round of Israeli-Palestinian talks in April 2014, various EU countries cautioned investors about risks involved in doing business with Israeli settlements.104 Additionally, the EU informed Israel that it does not allow the import of certain foods produced in Israeli settlements, apparently due to the European Commission's nonrecognition of Israeli inspection agencies' jurisdiction in the settlements. According to an Israeli media report, if EU guidelines are strictly adhered to, they "could affect Israeli banks and other businesses with branches in the West Bank."105

Nevertheless, some analysts assert that EU member states are divided over how to deal with Israel and unlikely to take measures substantially harming its economy. At a March 5, 2014, congressional hearing, one witness testified that "no European government supports any type of boycott against Israel."106 After an internal EU paper was leaked in late 2014 regarding possible responses to Israeli actions in East Jerusalem, EU foreign policy chief Federica Mogherini said, "There's currently no question of sanctioning anybody. The question is rather how to motivate people to … restart peace talks."107 In April 2015, 16 of 28 foreign ministers of European Union member states signed a letter encouraging Mogherini to implement guidelines dating from 2013 that authorize labeling goods that come from settlements in a way that differentiates them from goods coming from inside Israel.108

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

Israel is likely to need U.S. help in improving or mitigating troubled regional and international relationships, though even with this help, any improvement may be halting and reversible. U.S.-aided efforts by Israel to repair deteriorated relations with Turkey provide an example. During President Barack Obama's March 2013 visit to Israel, Prime Minister Netanyahu apologized via telephone to then Turkish Prime Minister (now President) Recep Tayyip Erdogan for any operational mistakes by Israel during the Gaza flotilla incident of May 2010 "that might have led to the loss of life or injury," and also agreed to conclude an agreement on "compensation/nonliability."110 However, subsequent difficulties in concluding such an agreement have been compounded by a number of developments, including negative statements from Erdogan, his associates, and pro-government Turkish media regarding Israel and Jews more generally on a number of issues; Turkey's reported ties with Hamas;111 and media reports that surfaced in October 2013 alleging that in 2012 Turkey revealed to Iran the names of sources used by Israel's Mossad intelligence agency.112 Despite bilateral political difficulties, Israel-Turkey trade volume has continued to grow,113 but according to the head of the Israel-Turkey Business Council, "the actual increase in trade was quite moderate and could, under other circumstances, have been much greater."114

Key U.S. Policy Issues

Overview

On May 14, 1948, the United States became the first country to extend de factocease-fires ending various rounds of conflict in Gaza have contemplated negotiating arrangements regarding security, commerce, and post-conflict reconstruction, though to date the status quo in and around Gaza has not significantly changed. Hamas appears unwilling to cede meaningful control over security in Gaza to the Palestinian Authority (PA).

Gazans remain largely dependent on international humanitarian aid. In its coordination with various organizations and international actors that ship building materials into Gaza from Israeli-manned checkpoints, 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. In August 2016, Israel arrested and charged two Gazans employed at humanitarian organizations—one at U.S.-based World Vision International, one at the U.N. Development Programme (UNDP)—in separate cases involving the alleged diversion of funds or resources to Hamas.59 The cases are ongoing.

Individual Palestinian Attacks

In the fall of 2015, tensions connected with Jerusalem's Temple Mount/Haram al Sharif contributed to a wave of mostly "lone wolf" attacks by Palestinians against Jewish Israeli security personnel and civilians that intensified for several months and have fluctuated since. More than 30 Israelis and 200 Palestinians had been killed as a result of that violence as of September 2016.60

Israeli authorities have responded with both incentives and punitive measures intended to deter future attacks. The government increased the number of permits for West Bank residents to work in Israel in hopes of reducing the grievances that officials apparently assume are driving the attacks.61 In July 2016, the prime minister's office announced that any amounts transferred by the PA to "terrorists and their families" would be deducted from the monthly tax revenues Israel transfers to the PA,62 though no public announcement of specific deductions has ensued. In August, Defense Minister Lieberman presented what has been called a "carrot and stick" plan, which has generated significant debate regarding its focus on linking rewards or punishments in specific Palestinian West Bank communities to the extent attackers come from those communities.63

While U.S. and international observers have denounced the Palestinian attacks and directed some criticism toward Palestinian Authority (PA) President Mahmoud Abbas and other Palestinian leaders, they have also criticized Israeli leaders for (1) allegedly disproportionate security responses, (2) continued settlement construction in the West Bank and East Jerusalem, and (3) resistance to new initiatives aimed at restarting peace talks. See "Peace Process Diplomacy and International Involvement" below.

Concerns Regarding International Relationships

Israel and many of its supporters, along with the international media, frequently raise the possibility that Israel could become more "isolated" (or, as some Israelis characterize it, "delegitimized") internationally.64 Some Israeli officials and outside observers downplay the concern, pointing to improvements in Israel's relations with a number of countries.65 While widespread consensus across Israel's political spectrum favors countering developments that may lead toward isolation, there is debate over the extent to which changes in Israeli policy on sensitive issues regarding Palestinians can positively affect international attitudes toward Israel. Right-of-center political figures within the government sometimes portray criticisms of Israeli actions as pretexts for more deep-seated prejudice against Israel and/or Jews, while left-of-center figures within the opposition periodically criticize government leaders for steps that may have the potential to undermine existing support for Israel in international fora.66

Since 2011, Palestinian leaders have taken a number of initiatives in international fora to advance the Palestinian national narrative. In many cases these initiatives largely oppose Israeli objectives. A number of these initiatives are discussed later in the report (see "Israeli-Palestinian Issues" below).

For information on international economic measures regarding Israel, see CRS Report R44281, Israel and the Boycott, Divestment, and Sanctions (BDS) Movement, coordinated by [author name scrubbed].

Turkey: Some Improvement in Relations

Israel is likely to need U.S. help in improving or mitigating troubled regional and international relationships, though even with this help, any improvement may be halting and reversible. For example, in 2010, Turkey cut off most modes of cooperation with Israel a year after the May 2010 Gaza flotilla incident.67 Only economic relations and low-level diplomacy endured. Previously (in the 1990s and early 2000s), Turkey and Israel had enjoyed close military ties that fostered cooperation in other areas, including a free trade agreement signed in 2000.68

In late June 2016, Israel and Turkey announced the full restoration of diplomatic relations. Negotiations toward this end had begun in 2013 after President Obama facilitated a phone call apology from Netanyahu to then Turkish Prime Minister (now President) Recep Tayyip Erdogan regarding the 2010 incident. Reportedly, Vice President Joe Biden facilitated the rapprochement in part due to potential mutual benefits anticipated by both sides from the construction of a natural gas pipeline from offshore Israeli fields to Turkey.69 According to media reports, the rapprochement includes Israeli compensation to the families of those killed in the 2010 incident in exchange for an end to legal claims, as well as opportunities for Turkey to use the Israeli port of Ashdod to stage some humanitarian and infrastructure assistance for Palestinian residents of the Gaza Strip. According to one report, "Hamas offices in Istanbul will remain open and Israel will have to make do with Turkey's assurances that they will only be allowed to engage in 'political' activities."70

The restoration of diplomatic relations is unlikely to portend a return to the close Israel-Turkey military or intelligence ties of past decades, though the two countries' intelligence heads reportedly have some rapport.71 Some security cooperation to address common threats or problems—including those emanating from Iran and various terrorist groups—might ultimately stem from the rapprochement.72

Key U.S. Policy Issues Overview On May 14, 1948, the United States became the first country to extend any type of 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 pillarsSuch support is part 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 ofhas avoided 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 possibleGiven 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 bothsome of Israel's leaders and supporters make the case to U.S. decisionmakers 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.

Recent Differences Among Leaders and on Key Issues

73

U.S. officials views on these points could influence 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. It also could influence the extent to which the United States places conditions on the support it provides to Israel.

The long-term effects of Israel's domestic political trends on its internal cohesion and its ties with the United States and broader Western world are unclear.74 A number of factors differentiate Israel from North America and Europe, including its geopolitical threat perceptions, unique historical experience, and its population's relatively higher level of direct military service.75 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 West.

Bilateral Differences and Overall Closeness

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 2009.76 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 at77 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

Security Cooperation128

Perceptions that the United States has become less engaged in addressing problems in the region may exacerbate Israel's anxiety over the extent to which it can rely on its geographically distant superpower partner to actively thwart potential threats Israel faces, and to do so in the manner Israel's government prefers. Some Israelis and others have argued that the level and nature of influence the United States has in the Middle East has been reduced, due to a number of political and economic factors.78 Nevertheless, substantial U.S. military assets remain deployed in the region, and U.S. officials regularly reiterate commitments to Israel (and other regional allies) and reinforce these statements through tangible means such as aid, arms sales, and missile defense cooperation.79 Bilateral Trade Issues The United States is Israel's largest single-country trading partner,80 and—according to data from the U.S. International Trade Commission—Israel is the United States's 23rd-largest trading partner.81 The two countries concluded a Free Trade Agreement (FTA) in 1985, and all customs duties between the two trading partners have since been eliminated. The FTA includes provisions that protect both countries' more sensitive agricultural sub-sectors with nontariff barriers, including import bans, quotas, and fees. Israeli exports to the United States have grown since the FTA became effective. Qualified Industrial Zones (QIZs) in Jordan and Egypt are considered part of the U.S.-Israel free trade area. In 2015, Israel imported approximately $13.5 billion in goods from and exported $24.5 billion in goods to the United States.82 The United States and Israel have launched several programs to stimulate Israeli industrial and scientific research, for which Congress has authorized and appropriated funds on several occasions.83 Security Cooperation84

Background

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 asis one of the top 10 exporters of arms worldwide.85

On November 30, 1981, the United States and Israel signed a memorandum of understanding (MOU)an 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 CountriesSensitive Defense Technology and Intelligence Issues" 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."

Security cooperation extends to cooperation in countering terrorism. The Implementing Recommendations of the 9/11 Commission Act of 2007 (P.L. 110-53, enacted on August 3, 2007) recognizes Israel as a potential research partner for the Department of Homeland Security.

Recent U.S. Legislation

Over the past three years, Congress passed two items of legislation with several provisions encouraging continued and expanded U.S.-Israel cooperation in a number of areas.

The U.S.-Israel Enhanced Security Cooperation Act (P.L. 112-150), which was enacted in July 2012, contains nonbinding "sense of Congress" language focusing largely on several possible avenues of cooperation. These include providing Excess Defense Articles; boosting operational, intelligence, and political-military coordination; expediting specific types of arms sales (such as F-35 fighter aircraft, refueling tankers, and "bunker buster" munitions); and additional aid for U.S.-Israel cooperative missile defense programs.

The U.S.-Israel Strategic Partnership Act (P.L. 113-296) was enacted in December 2014, after having been revised from earlier 2013 House and Senate versions. It designated Israel as a "major strategic partner" of the United States—a designation whose meaning has not been further defined in U.S. law or by the executive branch. The act contains various other provisions encouraging continued and expanded U.S.-Israel cooperation in a number of areas, such as those

  • extending the war reserves stockpile authority129 for Israel until sometime in FY2015;
  • requiring an executive branch report to Congress on the "feasibility and advisability of expanding United States-Israeli cooperation on cyber issues";
  • seeking to have the executive branch give Israel the same Strategic Trade Authorization (STA) licensing exception for certain munitions and dual-use items that 36 other countries currently have;130
  • authorizing cooperative research pilot programs between Israel and the Department of Homeland Security; and
  • amending the Energy Independence and Security Act of 2007 (42 U.S.C. §17337(a)) in a number of ways to facilitate U.S.-Israel energy cooperation, including by adding verbiage stating that "United States-Israel energy cooperation and the development of natural resources by Israel are in the strategic interest of the United States."

P.L. 113-296 further states that Israel should be designated a U.S. visa waiver program country when it satisfies—and as long as it continues to satisfy—the requirements for inclusion.131

The U.S.-Israel Enhanced Security Cooperation Act (P.L. 112-150) of 2012 and U.S.-Israel Strategic Partnership Act (P.L. 113-296) of 2014 encouraged continued and expanded U.S.-Israel cooperation in a number of areas, including defense, homeland security, cyber issues, energy, and trade. The latter act designated Israel as a "major strategic partner" of the United States—a designation whose meaning has not been further defined in U.S. law or by the executive branch.

Preserving Israel's Qualitative Military Edge (QME)

Since the late 1970s, successive Administrations have argued that U.S. arms sales are an important mechanism for addressing the security concerns of Israel and other regional countries. During this period, some Members of Congress have argued that sales of sophisticated weaponry to Arab countries may erode Israel's QME over its neighbors. However, successive Administrations have maintained that Arab countries are too dependent on U.S. training, spare parts, and support to be in a position to use sophisticated U.S.-made arms against the United States, Israel, or any other U.S. ally in a sustained campaign. Arab critics routinely charge that Israeli officials exaggerate the threat they pose. Ironically, theThe threat of a nuclear-armed and/or regionally bolstered Iran, though it has partially aligned Israeli and Sunni Arab interests in deterring a shared rival, may be exacerbating Israeli fears of a deteriorated QME, as Saudi Arabia and other Gulf states dramatically increase defense procurements from U.S. and other foreign suppliers.

In 2008, Congress enacted legislation requiring that any proposed U.S. arms sale to "any country in the Middle East other than Israel" must include a notification to Congress with a "determination that the sale or export of such would not adversely affect Israel's qualitative military edge over military threats to Israel."13286 In parallel with this legal requirement, U.S. and Israeli officials continually signal their shared understanding of the U.S. commitment to maintaining Israel's QME. However, the codified definition focuses on preventing arms sales to potential regional Israeli adversaries based on a calculation of conventional military threats. It is unclear whether calls for revisiting this definition or rethinking its implementation may arise in light of the evolving nature of potential regional threats to Israel's security.

What might constitute a legally defined adverse effect to QME is not clarified in U.S. legislation. After the passage of the 2008 legislation, a bilateral QME working group was created allowing Israel to argue its case against proposed U.S. arms sales in the region.13387 Former Secretary of Defense Robert Gates wrote that, in 2010, the Obama Administration addressed concerns that Israel's leaders had about the possible effect on QME of a large U.S. sale of F-15 aircraft to Saudi Arabia by agreeing to sell Israel additional F-35 aircraft.13488

The U.S.-Israel Strategic Partnership Act (P.L. 113-296) enacted in December 2014 requires more frequent QME assessments and executive-legislative consultations. It also requires that future QME determinations include evaluations of how potential arms sales would change the regional balance and interact with Israeli military capabilities, while also identifying measures Israel may need to take in response to the potential sales, and assurances the United States has made to Israel or has been requested to make by Israel in connection with the potential sales.

As of mid-2015, with the United States offering to sellWith the United States in the process of selling Arab Gulf states more and perhapshigher quantities of more advanced weapons in response to regional concerns about a possible international agreement on Iran's nuclear programIran, reports indicate that Israel has not voiced formal 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.13589 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

90 Nevertheless, Israel did reportedly maintain reservations regarding U.S. combat aircraft sales to Kuwait, Qatar, and Bahrain until the U.S.-Israel aid MOU agreed upon in September 2016 reassured Israel that it will have the necessary means to finance its F-35 purchases.91 It is unclear whether changes in the nature, political positions, or military postures of Arab regimes might change Israeli threat perceptions over time.

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 sympatheticsome U.S. policymakers.

U.S. Security Guarantees?

Although the United States and Israel do not have a mutual defense treaty or agreement that provides formal U.S. security guarantees,13892 successive Administrations have either stated or implied that the United States would help provide for Israel's defense in the context of discussing specific threats, such as from Iran.139 93 Meanwhile, U.S. Administrations and Congress have supported Israel's ability to defend itself by embracing and even codifying the concept of helping maintain Israel's QME over regional threats, as discussed above. Both houses of Congress routinely introduce and pass resolutions supporting Israel's right to defend itself and U.S. efforts to bolster Israel's capacity for self-defense. Some resolutions have included language that could imply support for more active U.S. measures to defend Israel. For example, H.Res. 523 and H.Con.Res. 21, both of which overwhelmingly passed the House (in 2005 and 2007, respectively) and addressed a possible Iranian threat, also both reasserted the "commitment of the United States to defend the right of Israel to exist as a free and democratic state."14094 Additionally, S.Res. 65, which the Senate passed in May 2013, reasserted a U.S. commitment to "ensuring the existence, survival, and security" of Israel and stated that the United States should provide "diplomatic, military, and economic support to the Government of Israel in its defense of its territory, people, and existence" if Israel is "compelled to take military action in legitimate self-defense against Iran's nuclear weapons program."

A former Israeli deputy national security advisor has written about potential benefits and drawbacks for Israel of more formal U.S. security guarantees for Israel, including a possible "nuclear umbrella." A 2006 article that this former official co-authored on a potential Iranian threat said:

Such an arrangement would seem to be a "no-brainer" for Israel. Yet Jerusalem might in fact be quite reluctant to conclude one. This, for three primary reasons, each deeply entrenched in Israel's national security thinking. First, it would fear a loss of freedom of action, due to the contractual requirement to consult on the means of addressing the threat. Second, it would be concerned lest the US demand that Israel divulge and even forego its independent capabilities. And third, it might worry that the US would not live up to its nuclear commitments, much as NATO allies feared during the Cold War.141

Perhaps at least partly due to some of the reasons this former Israeli official outlines, U.S. Administrations and Congress have supported Israel's ability to defend itself by embracing and even codifying the concept of helping maintain Israel's QME over regional threats, as discussed above.

U.S. Aid and Arms Sales to Israel

Specific figures and comprehensive detail regarding various aspects of U.S. aid and arms sales to Israel are discussed in CRS Report RL33222, U.S. Foreign Aid to Israel, by [author name scrubbed]. ThisThat report includes information on conditions that generally allow Israel to use its military aid earlier and more flexibly than other countries.

Aid Israel is the largest cumulative recipient of U.S. foreign assistance since World War II. Since 1976, Israel has generally been the largest annual recipient of U.S. foreign assistance, but has been occasionally supplanted sincewith occasional exceptions after 2004 by Iraq and Afghanistan. Since 1985, the United States has provided approximately $3 billion in grants annually to Israel. In the past, Israel received significant economic assistance, but now almost all U.S. bilateral aid to Israel is in the form of Foreign Military Financing (FMF). U.S. FMF to Israel represents approximately one -half of total FMF and between 15%-20% of Israel's defense budget.14295 The remaining threetwo years of athe current 10-year bilateral memorandum of understandingmilitary aid MOU commit the United States to $3.1 billion annually from FY2016 to FY2018, subject to congressional appropriations. Israel uses approximately 75% of its FMF to purchase arms from the United States, in addition to receiving U.S. Excess Defense Articles (EDA). In February 2015, Israel announced that it had reached agreement with U.S.-based company Lockheed Martin to purchase 14 F-35 (Lightning II) next-generation fighter aircraft, which would add to the 19 it agreed to purchase in 2010. The 2015 agreement reportedly includes an option to purchase an additional 17.143

In late July 2014, during the Israel-Gaza conflict, a reported U.S. sale to Israel of 120 mm tank rounds and 40 mm illumination rounds for grenade launchers from the War Reserves Stock Allies-Israel (WRSA-I) program144 reportedly led Obama Administration officials to temporarily delay at least one arms transfer to Israel—of Hellfire missiles—because of issues apparently related to centralization of U.S. interagency decision making.145

The United States also generally provides some annual American Schools and Hospitals Abroad (ASHA) funding and funding to Israel for migration assistance. Loan guarantees, arguably a form of indirect aid, also remain available to Israel through FY2015 under the U.S.-Israel Enhanced Security Cooperation Act (P.L. 112-150).

for FY2017 and FY2018, subject to congressional appropriations. The United States also generally provides some annual American Schools and Hospitals Abroad (ASHA) funding and funding to Israel for migration assistance.

Table 2. U.S. Bilateral Aid to Israel

(historical $ in millions)

Year

Total

Military Grant

Economic Grant

Immig. Grant

ASHA

All other

1949-1996

68,030.9

29,014.9

23,122.4

868.9

121.4

14,903.3

1997

3,132.1

1,800.0

1,200.0

80.0

2.1

50.0

1998

3,080.0

1,800.0

1,200.0

80.0

1999

3,010.0

1,860.0

1,080.0

70.0

2000

4,131.85

3,120.0

949.1

60.0

2.75

2001

2,876.05

1,975.6

838.2

60.0

2.25

2002

2,850.65

2,040.0

720.0

60.0

2.65

28.0

2003

3,745.15

3,086.4

596.1

59.6

3.05

2004

2,687.25

2,147.3

477.2

49.7

3.15

9.9

2005

2,612.15

2,202.2

357.0

50.0

2.95

2006

2,534.5

2,257.0

237.0

40.0

0.5

2007

2,503.15

2,340.0

120.0

40.0

2.95

0.2

2008

2,423.9

2,380.0

40.0

3.90

2009

2,583.9

2,550.0

30.0

3.90

2010

2,803.8

2,775.0

25.0

3.80

2011

3,029.22

3,000.0

25.0

4.225

2012

3,098.0

3,075.0

20.0

3.00

2013

2.943.2

2.793.2

15.0

2014

3,115.0

3,100.0

15.0

2015

3,110.0

3,100.0

10.0

2016 Request

3,110.0

3,100.0

10.0

2017 Request

3,107.5

3,100.0

7.5

Total

130,518
124,467.57.27

76,723.4

82,616.6

30,897.0

1,708.2

715.7

162.075

14,991.9

Notes: FY2000 military grants include $1.2 billion for the Wye agreement and $1.92 billion in annual military aid. The figure for FY2013 military grant aid was calculated after factoring in budget sequestration. For information on U.S. loan guarantees to Israel, see CRS Report RL33222, U.S. Foreign Aid to Israel, by [author name scrubbed].

Iron Dome and Missile Defense Cooperation

Congress routinely provides hundreds of millions of dollars in additional annual assistance for Israel's Iron Dome anti-rocket system146 and joint U.S.-Israel missile defense programs such as Arrow and David's Sling. During the summer 2014 Israel-Gaza conflict, Secretary of Defense Hagel sent a letter to congressional leaders advising them that—due to the conflict—Israel had requested $225 million in funding for Iron Dome on top of the $350.972 million already being contemplated by Congress for FY2015, and asking for Congress to support this request and to exempt it from requirements related to U.S. co-production.147 This funding request was granted by Congress in August via the Emergency Supplemental Appropriations Resolution, 2014 (P.L. 113-145). Various media outlets in July 2014 picked up a security blog's claim148 that hackers with alleged links to China may have sought to breach three Israeli defense companies' computer networks in connection with Iron Dome and the Arrow III program, though two of the supposedly targeted defense companies reportedly indicated that no such incidents had compromised sensitive information.149

For more information on Iron Dome, see CRS Report IN10158, Israel's Iron Dome Anti-Rocket System: U.S. Assistance and Coproduction, by [author name scrubbed].

Table 3. Defense Budget Appropriations for U.S.-Israeli Missile Defense:
FY2006-FY2016New Aid MOU

On September 14, 2016, the U.S. and Israeli governments signed a new 10-year MOU on annual U.S. military aid,96 which will come into effect in FY2019 after the current 10-year MOU runs its course.97 The Administration has stated that it is the largest single pledge of military assistance in U.S. history.98 One observer claimed that the deal provided vindication for Prime Minister Netanyahu and President Obama to some extent:

One, in Jerusalem, wanted to disprove the notion that he harmed bilateral relations with his country's greatest ally by picking a fight [over the 2015 Iran nuclear deal] with its leader.

And the other, soon to leave the White House, was looking for the ultimate seal of approval for his support to the Jewish State. Both ended the race legitimately claiming victory.99

The new MOU will affect U.S. security-related funding for Israel—subject to annual congressional appropriations—as follows:

  • Increases annual Foreign Military Financing (FMF) aid to Israel to $3.3 billion (from a current level of $3.1 billion).
  • Sets an annual U.S. funding level for U.S.-Israel cooperative missile defense programs at $500 million. Missile defense funding, which is appropriated from Defense Department accounts rather than State Department foreign aid accounts, was not included in past U.S.-Israel aid MOUs. Such funding has fluctuated above and below the $500 million mark from year to year.
  • Phases out (reportedly during the last half of the 10-year period)100 the longtime allowance for Israel to use 26.3% of annual FMF for purchases from its own domestic manufacturers. No similar allowance is available to other countries.
  • Ends or significantly reduces Israel's past practice of using FMF for fuel purchases.

Reportedly, Israel has agreed in writing to refrain from requesting supplemental funding from Congress for the MOU's entire duration, except for special emergency needs resulting from an armed conflict.101 It is unclear how this will affect Congress's role in the appropriations process.

Additionally, Senator Lindsey Graham has said that as part of the deal, the Israeli government signed a letter agreeing to return any funds that Congress might appropriate for the remaining two years (FY2017 and FY2018) covered by the FY2009-FY2018 MOU that was finalized in 2007 during the Bush Administration.102 Senator Graham is chairman of the Senate Appropriations Subcommittee on State, Foreign Operations, and Related Programs. This subcommittee's version of the FY2017 appropriations bill (S. 3117) would provide Israel with $3.4 billion, $300 million more than the $3.1 billion called for in the current MOU. In September 2016, following the new MOU's signing, Senator Graham and six other Senators introduced the Emergency Supplemental Appropriations Act for the Defense of Israel, 2016 (S. 3363), which would appropriate additional emergency funds for Israel in the amount of $750 million in FMF and $750 million in missile defense funding.

On July 25, 2016, the Israeli Prime Minister's office released a statement that read in part, "Israel places great value on the predictability and certainty of the military assistance it receives from the United States and on honoring bilateral agreements. Therefore, it is not in Israel's interest for there to be any changes to the fixed annual MOU levels without the agreement of both the U.S. Administration and the Israeli government. For FY2017, Israel remains committed to the FMF level specified in the current MOU, which is $3.1 billion."

Arms Sales and Anti-Tunneling

Israel uses approximately 74% of its FMF to purchase arms, equipment, and fuel from the United States, in addition to receiving U.S. Excess Defense Articles (EDA).

In February 2015, Israel announced that it had reached agreement with the U.S.-based company Lockheed Martin to purchase 14 F-35 (Lightning II) next-generation fighter aircraft, which would add to the 19 it agreed to purchase in 2010. The 2015 agreement reportedly includes an option to purchase an additional 17 (which would bring the total to 50).103 Israel has received U.S. approval to purchase up to 75 F-35s—potentially leading to as much as $15.2 billion in purchases if all options are exercised. As part of the F-35 deal, the United States agreed to make reciprocal purchases of equipment from Israeli defense companies estimated at $4 billion for these companies' participation in the F-35's manufacture.104 Israel is supposed to be the first country outside the United States to receive the F-35, with the two initial fighters scheduled to arrive in December 2016. According to one source, Israel then anticipates delivery of an additional seven or eight per year until 2021.105 Israel will install Israeli-made C4 (command, control, communications, computers) systems in the F-35s it receives, and will call these customized F-35s "Adirs."106

Since Israel's summer 2014 conflict with Hamas and other militants in Gaza, Israel has sought U.S. assistance to develop, test, and produce systems to detect and destroy border-breaching tunnels Hamas had used during the conflict. The Consolidated Appropriations Act, 2016 (P.L. 114-113), included $40 million from Overseas Contingency Operations (OCO) funding for U.S.-Israel cooperation in developing anti-tunnel technology,107 and Israeli leaders have reportedly sought at least the same amount for FY2017 and FY2018.108

On occasion, Israel-based companies have competed with U.S.-based companies for defense contracts with third-party countries. For example, in a 2014 tender for anti-tank missiles, India reportedly chose Israel's offer over a rival U.S. offer.109 In another example, in September 2016, Poland selected a variant of the U.S.-origin Patriot air defense system over Israel's David's Sling and other offers from the United States and France.110

End-Use Monitoring and Leahy Law Vetting

Sales of U.S. defense articles and services to Israel are made subject to the terms of both the AECA and the July 23, 1952, Mutual Defense Assistance Agreement between the United States and Israel (TIAS 2675). The 1952 agreement states:

The Government of Israel assures the United States Government that such equipment, materials, or services as may be acquired from the United States ... are required for and will be used solely to maintain its internal security, its legitimate self-defense ... and that it will not undertake any act of aggression against any other state.

Past Administrations have acknowledged that some Israeli uses of U.S. defense articles may have gone beyond the requirements under the AECA and the 1952 agreement that Israel use such articles for self-defense and internal security purposes. These past Administrations have transmitted reports to Congress stating that "substantial violations" of agreements between the United States and Israel regarding arms sales "may have occurred." The most recent report of this type was transmitted in January 2007 in relation to concerns about Israel's use of U.S.-supplied cluster munitions during military operations against Hezbollah in Lebanon during 2006.111 Other examples include findings issued in 1978, 1979, and 1982 with regard to Israel's military operations in Lebanon and Israel's air strike on Iraq's nuclear reactor complex at Osirak in 1981. The Reagan Administration suspended the delivery of cluster munitions to Israel from 1982 to 1988 based on concerns about their use in Lebanon. The Reagan Administration also briefly delayed a scheduled shipment of F-15 and F-16 aircraft to Israel following Israel's 1981 strike on Iraq. If Israel takes future action with U.S. defense articles to preempt perceived security threats, allegations of AECA violations could follow, depending on specific circumstances.112

Additionally, Section 620M of the Foreign Assistance Act of 1961 (FAA), as amended (commonly known as the Leahy Law),113 prohibits the furnishing of assistance authorized by the FAA and the AECA to any foreign security force unit where there is credible information that the unit has committed a gross violation of human rights. The State Department implements Leahy vetting to determine which foreign security force units (and individuals within the units) are eligible to receive U.S. assistance or training. In 2016, Senator Patrick Leahy and 10 other Members of Congress corresponded with the State Department on the application of the Leahy Law to some specifically alleged instances of possible extrajudicial killings or torture by Israeli personnel.114 The State Department assured the Members of Congress that it was properly conducting Leahy vetting and monitoring the instances that were mentioned in their letter.115

Missile Defense Cooperation

Congress routinely provides hundreds of millions of dollars in annual assistance beyond Administration requested amounts for Israel's Iron Dome anti-rocket system116 and joint U.S.-Israel missile defense programs such as Arrow and David's Sling. According to an Israeli source, the David's Sling system has already been delivered to the Israeli air force, and it is expected to be declared operational in 2016.117 David's Sling is designed to counter long-range rockets and slower-flying cruise missiles fired at ranges from 100 km to 200 km, such as those possessed by Hezbollah in Lebanon.118 In July 2016, the United States and Israel announced that they had successfully conducted a special trial—the first of its kind in eight years—to test the connectivity of U.S.- and Israeli-controlled missile defense systems that are based in and around Israel.119

Because Iron Dome was developed by Israel alone, Israel initially retained proprietary technology rights to it. As the United States began financially supporting Israel's further development of Iron Dome in FY2011, U.S. interest in ultimately becoming a partner in its co-production grew. Congress then called for Iron Dome technology sharing and co-production with the United States.120 In March 2014, the United States and Israeli governments signed a production agreement to enable components of the Iron Dome system to be manufactured in the United States, while also providing the U.S. Missile Defense Agency (MDA) with full access to proprietary Iron Dome technology. In May 2016, Israel's military said that it had successfully tested a naval version of Iron Dome (known as "C-Dome") and would begin deploying it to protect offshore gas rigs and other strategic assets. The system combines elements of the land-based Iron Dome system with naval radar.121

Observers speculate about the potential for exporting Iron Dome and its technology. According to one media report, the Israeli state-owned company that initially developed Iron Dome (Rafael Ltd.) has a teaming agreement with U.S.-based Raytheon Missile Systems Co. "whereby Raytheon co-markets Iron Dome for prospective sales in the US and select target markets. In parallel, Rafael is working with Raytheon to market the US Army-tested Tamir interceptor integrated into the service's Multi-Mission Launcher under a program called Sky Hunter."122 Some reports and official statements indicate that Israel may have agreed to share elements of Iron Dome's radar technology with Singapore123 and Canada.124 However, in a June 2016 interview, an Israeli defense ministry official indicated that, at that point in time, Iron Dome had not been exported.125

Table 3. Defense Budget Appropriations for U.S.-Israeli Missile Defense:FY2006-FY2017 Request

(historical $ in millions)

FY2017 Request

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

70.000a

305.700

FY2013b

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

FY2016c

56.519

89.550

286.526

55.000

487.595

11.000

10.800

55.100

800

36.700

37.200

5542.000

157145.800

a. These funds were not appropriated by Congress, but reprogrammed by the Obama Administration from other Department of Defense accounts.

b. Figures for FY2013 calculated after factoring in budget sequestration.

c. The House version of the National Defense Authorization Act for FY2016 (H.R. 1735) would authorize $164.8 million more than the aggregate amount requested by the Administration for David's Sling, Arrow II, and Arrow III. The Senate version (S. 1376) would authorize an additional $166 million in the aggregate for these three programs, while authorizing an amount for Iron Dome that is $13.9 million less than the requested amount.

Pending Security Cooperation Legislation

2017 National Defense Authorization Act (NDAA). The House-passed version of the NDAA (H.R. 4909) includes the following provisions:

  • Section 1250. Would authorize up to $25 million for U.S.-Israel cooperation in research and development of directed energy (laser) technologies to counter missiles, drones, mortars, and improvised explosive devices if the two countries can reach agreement on sharing costs and intellectual property rights.
  • Section 1259J. Would authorize assistance to Israel "to improve maritime security and maritime domain awareness" over a five-year period. Activities for which assistance would be specifically authorized include support for the David's Sling missile defense system, Israeli participation in joint maritime exercises with the United States, visits of U.S. vessels at Israeli ports, and research and development.
  • Section 1259N. Would require the Administration to report within 180 days to congressional committees on (1) defensive capabilities and platforms requested by Israel, (2) the availability of such items for transfer, and (3) steps the President is taking to transfer such items.

The Senate-passed version of the NDAA (S. 2943) does not include any of the above provisions, but includes a separate provision that would increase the annual amount authorized for U.S.-Israel anti-tunneling cooperation (through calendar year 2018) from $25 million to $50 million if such funds are matched in the corresponding calendar year by Israel. Of any U.S. amounts used for this purpose in FY2017, not less than 50% would be for research, development, test, and evaluation activities in the United States.

Both H.R. 4909 and S. 2943 would authorize funding for Israel-based missile defense systems beyond the Administration's budget request, but the aggregate increases in S. 2943 are less than in H.R. 4909. A July 2016 letter from 36 Senators urged the chairmen of the conference reconciling the two bills to use the H.R. 4909 figures.126

2017 Department of Defense Appropriations Act. Following the pattern from previous years, both the House-passed (H.R. 5293) and Senate-introduced (S. 3000) versions of this act would provide funding for Israel-based missile defense systems beyond the Administration's budget request.127 On June 14, 2016, in a document opposing a number of items in H.R. 5293, the Administration said that it "opposed the addition of $455 million above the FY 2017 Budget request for Israeli missile defense procurement and cooperative development programs."128 In a June 15, 2016, daily press briefing, the State Department spokesperson explained the Administration's position by saying that $455 million "is the largest such non-emergency increase ever and, if it's funded, would consume a growing share of a shrinking U.S. Missile Defense Agency's budget." Some observers interpreted the Administration's position as possibly being linked to the then-ongoing MOU negotiations.129

Sensitive Defense Technology and Intelligence Issues

Arms sales, information sharing, and co-development of technology between the United States and Israel raise 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)130 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 United States and Israel have regularly discussed Israel's sale of sensitive security equipment and technology to various countries, especially China.131 In 2003, Israel's agreement to upgrade radar-seeking Harpy Killer drones that it sold to China in 1999 dismayed the Department of Defense (DOD). DOD retaliated by suspending its joint strategic dialogue with Israel and its technological cooperation with the Israel Air Force on the F-35 aircraft and several other programs. On August 17, 2005, DOD and the Israeli Ministry of Defense issued a joint press statement reporting that they had signed an understanding "designed to remedy problems of the past that seriously affected the technology security relationship and to restore confidence in the technology security area."132 Thereafter, the U.S.-Israel joint strategic dialogue resumed. Sources have reported that this understanding has given the United States de facto veto power over Israeli third-party arms sales that the United States deems harmful to its national security interests.133

In the past 30 years, there have been at least three cases in which U.S. government employees were convicted of disclosing classified information to Israel or of conspiracy to act as an Israeli agent.134 Reports indicate that concerns regarding possible Israeli espionage persist among U.S. officials.135

Israeli-Palestinian Issues

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

Official U.S. policy continues to favor a "two-state solution" to address core Israeli security demands as well as Palestinian aspirations for national self-determination. Continued failure by Israelis and Palestinians to make progress toward a negotiated solution could have a number of regional and global implications. Israeli actions regarding security arrangements and settlement construction in the West Bank and East Jerusalem could have ramifications for the resolution of final-status issues. Palestinian leaders support initiatives to advance their statehood claims and appear to be encouraging international legal and economic pressure on Israel in an effort to improve the Palestinian position vis-à-vis Israel. U.S. and international efforts to preserve the viability of a negotiated two-state solution attract skepticism because of regional turmoil and domestic reluctance among key Israeli and Palestinian leaders and constituencies to contemplate political or territorial concessions.

Meanwhile, Israelis debate whether their leaders should participate in international initiatives, advance their own diplomatic proposals, act unilaterally, or manage the "status quo." Netanyahu has publicly welcomed resuming negotiations without preconditions, while insisting that regional difficulties forestall or seriously impede prospects for mutual Israeli-Palestinian concessions through negotiation. Additionally, several government ministers openly oppose a two-state solution.136 Toward the left of the political spectrum, some Israeli politicians welcome the prospect of greater U.S. involvement in principle, claiming that regional challenges, Israel's international ties, and demographic changes make resolving the Palestinian issue a priority. Even so, center-left leaders such as Yitzhak Herzog of the main opposition Labor party seem to acknowledge that a two-state solution is unlikely in the near term.137

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. Formally, the Arab League remains committed to "land for peace," as reflected in the 2002 Arab Peace Initiative.138 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. , by [author name scrubbed].

Peace Process Diplomacy and International Involvement

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.

For their part, Palestinian leaders and Arab state rulers may find it harder to move toward formal peace with Israel if they become more accountable to public opinion focused on Israel and its indicia of control in the West Bank, Gaza, and Jerusalem. Formally, the Arab League remains committed to "land for peace," as reflected in the 2002 Arab Peace Initiative.151

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.152139

During the next two years, PLO Chairman Mahmoud Abbas opted to pursuepursued major 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."153140 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 141 Abbas resumed international initiatives, most prominently regarding the International Criminal Court, following a round of U.S.-brokered Israeli-Palestinian negotiations that began in July 2013 and unraveled in the spring of 2014. Additionally, 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.142 For more information, see CRS Report RL34074, The Palestinians: Background and U.S. Relations, by [author name scrubbed]. Outstanding Issues Media reports from the failed 2013-2014 negotiations 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.155143 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."156144 Prime Minister Netanyahu repeatedly raised the issue of Jewish refugees from predominantly Muslim Middle Eastern countries.157145

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,158146 while Israel communicated unwillingness to phase out its presence159147—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.160148 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).161149 It is unclear whether the document reflected Netanyahu's positions of that time.162150 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.163151

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 constituencyachieve genuinely united rule over the West Bank and Gaza through factional arrangements between Fatah and Hamas, and if so, how will that help the PLO's credibility as an interlocutor 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 Observers speculate that the United States might set forth or agree to terms of reference in a presidential statement or U.N. Security Council initiative calculated to preserve the viability of a negotiated two-state solution and of U.S. diplomatic leadership on the issue.152 After the September 2016 signing of the U.S.-Israel aid MOU, President Obama asserted that "we will continue to press for a two-state solution to the longstanding Israeli-Palestinian conflict, despite the deeply troubling trends on the ground that undermine this goal."153 On the same day, National Security Advisor Susan Rice said, "We don't have any plans to do anything particularly dramatic at this point. We continue to want to see a two-state solution remain a live option. It's vitally important."154 On September 20, 88 Senators sent a letter to Obama urging him to "make it clear that you will veto any one-sided UNSC resolution that may be offered in the coming months … whether focused on settlements or other final-status issues."155

Netanyahu and Lieberman have welcomed efforts by Russia156 and Egypt to facilitate an initiative involving Arab states "which share security interests with Israel and have leverage on the Palestinians."157 However, some analysts assert that Arab states are distracted by other internal and regional concerns158 and are unlikely to use their leverage unless Israel shows a willingness to contemplate concessions envisioned in the 2002 Arab Peace Initiative.159

In the meantime, U.S. efforts to prevent or mitigate crises could depend largely on continued Israel-PA West Bank security cooperation168160 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

Also, questions persist regarding the aging Abbas's remaining tenure and what will happen when he leaves office.161

Jerusalem

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,171162 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.172163 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.

not internationally recognized. Palestinians who live in Jerusalem and/or have Israeli citizenship generally face fewer security-based access restrictions than do residents of the West Bank and Gaza Strip.164

Tensions and Violence Surrounding Jerusalem andRegarding the "Status Quo" at the Mount/Haram

The status of Jerusalem and its holy sites has been a long-standing issue of political and religious contention between Jews and Muslims. A number of violent episodes occurred in Jerusalem during the 1920s and 1930s, and control over the city and key areas in and around it was a major strategic consideration in the Arab-Israeli wars of 1948 and 1967.

Notwithstanding Israel's 1967 takeover and subsequent annexation of East Jerusalem, it allowed the Jordanian waqf (or Islamic custodial trust) that had been administering the Mount/Haram and its holy sites before the war to continue doing so, and established a "status quo" arrangement that has been Israel's proclaimed policy since then. Under the arrangement (largely based on past practices dating from the 16th century until the 1948 war), Muslims can access the Mount/Haram and worship there, while Jews and other non-Muslims are permitted limited access but not permitted to worship. Jewish worship is permitted at the Western Wall at the base of the Mount/Haram. Occasional access restrictions applied to Muslim patrons, such as those based on gender and/or age, have contributed to allegations that Israeli implementation of the status quo has been "piecemeal."173165

The status quo is criticized and challenged by some individuals and groups who assert that Israel should advance Jewish historical and religious claims to the Mount/Haram, despite Chief Rabbinate rulings proscribing Jewish visits there.174166 Various past events apparently triggering concerns among Palestinians about possible Israeli attempts to change the status quo have arguably fueled tensions, including:

  • September 1996 clashes (during Netanyahu's first term as prime minister) leading to the deaths of 54 Palestinians and 14 Israeli security personnel after Israel opened a passage leading to/from the Western Wall esplanade through a tunnel (known as the Hasmonean or Kotel Tunnel) that archeologists had uncovered and restored.175167
  • A September 2000 Mount/Haram visit by Likud Party leader (and future prime minister) Ariel Sharon just prior to the outbreak of the second Palestinian intifada.
  • Changes in 2003 where Israel ended coordination with the Jordanian waqf over non-Muslim visits to the Mount/Haram and the waqf began restricting non-Muslims from entering the Dome of the Rock and Al Aqsa Mosque.168
  • A series of incidents sinceA series of incidents in fall 2014 featuring visits by right-of-center Knesset members and Jerusalem's mayorIsraeli political figures to the Mount/Haram, followed by protests, violence, and periodic access closures to the Mount/Haram.176

These tensions exist within a larger context of competing national and religious narratives regarding Jerusalem and its administration and development. .169

  • The October 2016 adoption of Arab-sponsored resolutions by UNESCO's Executive Board and World Heritage Committee. The resolutions criticized various Israeli actions, including those at and around the Mount/Haram, and downplayed Jewish names and historical narratives in connection with various holy sites.170 In response to the Executive Board resolution, Israel suspended its cooperation with UNESCO,171 and UNESCO's Director-General raised concerns about the effect that divisions based on religious narrative might have on UNESCO's ability to carry out its mission.172
  • These tensions exist within a larger context of competing national and religious narratives regarding Jerusalem and its administration and development. In some cases, officials who embrace a Jewish or Muslim narrative make statements or take actions respecting the Mount/Haram that diminish the other narrative.173

    Israelis have routinely used their influence with municipal and national authorities to advance Jewish objectives in the city, while Palestinians with little or no influence over Jerusalem's formal administration have resorted to protests and occasional violence.177174 Some local and international observers and civil society organizations seek to raise legal objections to and/or international consciousness regarding the situation. Jewish Israeli public opinion overwhelmingly opposes any division of the city in a potential agreement with the PLO.178175 Some Knesset members have sought to bring legislation to a vote regarding Jewish worship on the Mount/Haram.179

    While routine Israeli security measures largely prevent Palestinians from the West Bank and Gaza Strip from threatening Jewish population centers, they present less of an impediment to Palestinians who live in Jerusalem and/or have Israeli citizenship.180 In the wake of the fall 2014 incidents, additional measures have been adopted and debated.181 Apparently seeking to quell tensions and reassure Jordan, the United States, and other key international third parties, Netanyahu has insisted that the status quo access arrangements for the Mount/Haram will continue.

    176

    Apparently seeking to quell tensions and reassure Jordan, the United States, and other key international third parties, Netanyahu has insisted that the status quo access arrangements for the Mount/Haram will continue, and an informal moratorium since late 2015 on Mount/Haram visits by major Israeli political figures and Temple activists appears to be holding. However, upholding these arrangements is periodically challenged by Israeli-Palestinian tensions that grow either out of some Israeli Jews' actions to increase their presence or religious profile at or near the Mount/Haram, especially during Jewish holidays, or out of some Palestinians' anticipation that such actions might be imminent.

    Successive U.S. Administrations of both political parties since 1948 have maintained that the fate of Jerusalem is to be decided by negotiations and have discouraged the parties from taking actions that could prejudice the final outcome of those negotiations. The Palestinians envisage East Jerusalem as the capital of their future state. However, the House of Representatives passed H.Con.Res. 60 in June 1997, and the Senate passed S.Con.Res. 21 in May 1997. Both resolutions called on the Clinton Administration to affirm that Jerusalem must remain the undivided capital of Israel.

    A related issue is the possible future relocation of the U.S. embassy from Tel Aviv to Jerusalem. Proponents argue that Israel is the only country where a U.S. embassy is not in the capital identified by the host country, that Israel's claim to West Jerusalem—proposed site of an embassy—is unquestioned, and/or that Palestinians must be disabused of their hope for a capital in Jerusalem. Opponents say such a move would undermine prospects for Israeli-Palestinian peace and U.S. credibility with Palestinians and in the Muslim world, and could prejudge the final status of the city. The Jerusalem Embassy Act of 1995 (P.L. 104-45) provided for the embassy's relocation by May 31, 1999, but granted the President authority, in the national security interest, to suspend limitations on State Department expenditures that would be imposed if the embassy did not open. Presidents Clinton, Bush, and Obama have consistently suspended these spending limitations, and the embassy's status has remained unchanged.

    The Foreign Relations Authorization Act for FY2003 (P.L. 107-228) urged the President to begin relocating the U.S. embassy "immediately." The act also sought to (1) prohibit the use of appropriated funds for the operation of U.S. diplomatic facilities in Jerusalem unless such facilities were overseen by the U.S. ambassador to Israel; and (2) allow Israel to be recorded as the place of birth of U.S. citizens born in Jerusalem. When signing the act into law, President George W. Bush wrote in an accompanying "signing statement" that the various provisions on Jerusalem would, "if construed as mandatory … impermissibly interfere with the president's constitutional authority to conduct the nation's foreign affairs." The State Department declared, "our view of Jerusalem is unchanged. Jerusalem is a permanent status issue to be negotiated between the parties."

    The case ofSupreme Court's 2015 ruling in Zivotofsky v. Kerry, which was argued before the Supreme Court in November 2014, could decide orheld that the President's power to recognize foreign nations trumps Congress's power to regulate passports, could have implications for Congress's constitutional authority on questions relating to the status of Jerusalem and could influence its future ability to direct the executive branch in its conduct of foreign affairs more broadly. The case involvesinvolved a U.S. citizen who was born in Jerusalem, and whose parents are suingsued on his behalf to have the State Department reflect Israel as his birthplace on his passport pursuant to P.L. 107-228. The Supreme Court's review of the case focuses on a July 2013 ruling by the U.S. Court of Appeals for the District of Columbia Circuit, which found that the "President's power to recognize foreign nations is exclusive and trumps Congress's authority to regulate passports."182177

    Over successive Congresses, including the 114th, various Members have periodically introduced substantially similar versions of a Jerusalem Embassy and Recognition Act (e.g., H.R. 114 and S. 117) or thematically related bills or resolutions. Such bills and resolutions seek the embassy's relocation and would remove or advocate for the removal of the President's authority to suspend the State Department expenditure limitations cited above.

    Figure 32. Greater Jerusalem

    Note: All locations and lines are approximate.

    Figure 43. Jerusalem: Old City, U.S.-Relevant Sites, and Some Other Sites

    Note: All locations and lines are approximate.

    Settlements

    General Overview Israel has approximately 135 residential communities (known internationally and by significant segments of Israeli society as "settlements"), approximately 100 additional settlement outposts unauthorized under Israeli law, and other military and civilian land-use sites in the West Bank. In addition, depending on how one defines what constitutes a separate neighborhood or settlement in East Jerusalem, Israeli authorities and Jewish Israeli citizens have established roughly 14 main residential areas there.183178 Approximately 340371,000 Israelis live in West Bank settlements, with nearly 200212,000 more in East Jerusalem.184179 All of these residential communities are located in areas that Palestinians assert are rightfully part of their envisioned future state. The first West Bank settlements were constructed following the 1967 war, and were initially justified as directly associatedresidential areas connected to personnel involved with Israel's military occupation. Major West Bank residential settlement building began in the late 1970s with the advent of the pro-settler Gush Emunim ("Bloc of the Faithful") movement and the 1977 electoral victory of Menachem Begin and the Likud Party. Existing settlements were expanded and new ones established throughout the 1990s and 2000s despite the advent of the Madrid-Oslo peace process with the Palestinians. According to the New York Times, since around 1999 the settler population has grown at roughly twice the total Israeli population growth rate, with the ratio having been even higher in some previous years.185180 Israelis who defend the settlements' legitimacy generally use some combination of legal, historical, strategic, nationalistic, or religious justifications.186181

    The international community generally considers Israeli construction on territory beyond the Green Line to be illegal.187182 One Israeli anti-settlement advocacy group claims, "In Area C [of the West Bank], a two-tier planning system operates based on ethnic-national background: a civil and representative planning system for Jewish settlers, and a military system without representation for Palestinians."188183 Israel retains military control over the West Bank and has largely completed a separation barrier189184 that roughly tracks the Green Line but departs from it in a number of areas, presumably to maintain convenient access to Israel for certain West Bank settlements. The barrier is intended to separate Israelis and Palestinians and prevent terrorists from entering Israel. Palestinians object to the barrier being built on their territory because it cuts Palestinians off from East Jerusalem and, in some places, bisects their landholdings and communities. It also is seen by many as an Israeli device to unilaterally determine borders between Israel and a future Palestinian state.

    U.S. policy on settlements has varied since 1967. Until the 1980s, multiple Administrations either stated or implied that settlements were "contrary to international law," with President Carter's Secretary of State Cyrus Vance stating explicitly that settlements were "illegal" in 1980.190 President Reagan later stated that settlements were "not illegal," but "ill-advised" and "unnecessarily provocative." Since then, the executive branch has generally refrained from pronouncements on the settlements' legality.191 A common U.S. stance has been that settlements are an "obstacle to peace." A former U.S. official has written that U.S. Administrations are "not entirely sure what to do with the fact that Israeli prime ministers of all political stripes have continued Israeli settlement building on the West Bank and construction in parts of east Jerusalem that we'd like to see become the capital of a Palestinian state."192 Loan guarantees to Israel currently authorized by U.S. law are subject to possible reduction by an amount equal to the amount Israel spends on settlements in the occupied territories. The executive branch made its most recent reduction in FY2005.193

    An April 2004 letter from President George W. Bush to then Israeli Prime Minister Ariel Sharon explicitly acknowledged that "in light of new realities on the ground, including already existing major Israeli populations (sic) centers, it is unrealistic to expect that the outcome of final status negotiations will be a full and complete return to the armistice lines of 1949." Partly because of such statements from U.S. policymakers, Arab critics routinely charge that U.S. support of Israel indirectly supports settlement activity.

    Like other Administrations, the Obama Administration has faced challenges in approaching this issue. In the context of its initial attempts to restart the peace process between Israelis and Palestinians, the Administration called for Israel to totally freeze all settlement activity, including in East Jerusalem. In his speech in Cairo in May 2009, President Obama said, "The United States does not accept the legitimacy of continued Israeli settlements. This construction violates previous agreements and undermines efforts to achieve peace. It is time for these settlements to stop."194 PLO leaders followed suit and made a settlement freeze a precondition for their return to the peace talks. Israel responded with a partial 10-month moratorium, but tentative efforts to restart negotiations did not take hold during that time. In February 2011, the United States vetoed a draft U.N. Security Council resolution that would have characterized Israeli settlements in the West Bank and East Jerusalem as illegal. All other 14 members of the Council, including the United Kingdom, France, and Germany, voted for the draft resolution. Susan Rice, then the U.S. Permanent Representative to the United Nations, clarified that the Administration still opposed settlement construction as illegitimate and at cross-purposes with peace efforts,195 and this remains stated U.S. policy.196 On December 5, 2014, 48 Members of Congress signed a letter to President Obama asking for immediate clarification of some recent media reports.197 The initial report—on which the others appear to have been based—suggested that the Administration had held a classified meeting to discuss the possibility of taking steps against Israel in response to residential construction in the West Bank and East Jerusalem.198

    Given the structure of Israeli society and politics, it may be difficult to impose an external restraint on settlement activity. Settlers affect the political and diplomatic calculus through the following means:

    • 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 Given the structure of Israeli society and politics, it may be difficult to impose an external restraint on settlement activity. Various Israeli government agencies' 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 appear to demonstrate the government's sensitivity to domestic concerns. Settlers affect the political and diplomatic calculus through the following means:

    • 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.
    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

    185

    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 When ordered by Israel's court system to dismantle outposts, the government has complied. In some cases, the government has placated settler opposition to dismantlement by relocating the displaced outpost residents within the boundaries of settlements permitted under Israeli law.202

    Sensitive Defense Technology and Intelligence Issues

    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.

    Israeli Arms Sales to Other Countries

    Israel is a major arms exporter—with India, China, and Russia among its customers or past customers.204 The United States and Israel have regularly discussed Israel's sale of sensitive security equipment and technology to various countries, especially China.205 In 2003, Israel's agreement to upgrade radar-seeking Harpy Killer drones that it sold to China in 1999 dismayed the Department of Defense (DOD). DOD retaliated by suspending its joint strategic dialogue with Israel and its technological cooperation with the Israel Air Force on the F-35 Joint Strike Fighter (JSF) aircraft and several other programs, among other measures.

    On August 17, 2005, DOD and the Israeli Ministry of Defense issued a joint press statement reporting that they had signed an understanding "designed to remedy problems of the past that seriously affected the technology security relationship and to restore confidence in the technology security area."206 Thereafter, the U.S.-Israel joint strategic dialogue resumed. Sources have reported that this understanding has given the United States de facto veto power over Israeli third-party arms sales that the United States deems harmful to its national security interests.207 In December 2013, the then head of Israel's Defense Export Control Agency (DECA), Meir Shalit, resigned after a joint U.S.-Israel investigation concluded that an Israeli miniature cooling system that can be used for missiles, and that had been licensed for sale to a French company, had been retransferred to China.208 In the months prior to this development, the Israeli state comptroller had reportedly published a report indicating that DECA was inadequately enforcing proper defense export controls.209

    With regard to Israel-India defense industrial cooperation, the two countries have reportedly agreed to jointly develop a medium-range air defense system to replace Russian-made systems in India.210 In a recent tender for anti-tank missiles, in late 2014 India reportedly chose Israel's offer over a rival U.S. offer.211

    End-Use Monitoring

    Sales of U.S. defense articles and services to Israel are made subject to the terms of both the AECA and the July 23, 1952, Mutual Defense Assistance Agreement between the United States and Israel (TIAS 2675). The 1952 agreement states:

    The Government of Israel assures the United States Government that such equipment, materials, or services as may be acquired from the United States ... are required for and will be used solely to maintain its internal security, its legitimate self-defense ... and that it will not undertake any act of aggression against any other state.

    Past Administrations have acknowledged that some Israeli uses of U.S. defense articles may have gone beyond the requirements under the AECA and the 1952 agreement that Israel use such articles for self-defense and internal security purposes. These past Administrations have transmitted reports to Congress stating that "substantial violations" of agreements between the United States and Israel regarding arms sales "may have occurred." The most recent report of this type was transmitted in January 2007 in relation to concerns about Israel's use of U.S.-supplied cluster munitions during military operations against Hezbollah in Lebanon during 2006.212 Other examples include findings issued in 1978, 1979, and 1982 with regard to Israel's military operations in Lebanon and Israel's air strike on Iraq's nuclear reactor complex at Osirak in 1981. The Reagan Administration suspended the delivery of cluster munitions to Israel from 1982 to 1988 based on concerns about their use in Lebanon. The Reagan Administration also briefly delayed a scheduled shipment of F-15 and F-16 aircraft to Israel following Israel's 1981 strike on Iraq. If Israel takes future action with U.S. defense articles to preempt perceived security threats, allegations of AECA violations could follow, depending on specific circumstances.213

    Espionage and Espionage-Related Cases

    In the past 30 years, there have been at least three cases in which U.S. government employees were convicted of disclosing classified information to Israel or of conspiracy to act as an Israeli agent. Reports indicate that concerns regarding possible Israeli espionage persist among U.S. officials. During the 113th Congress, a version of the U.S.-Israel Strategic Partnership Act (S. 462) contemplated possibly exempting Israel from two general requirements related to the visa waiver program. In connection with congressional deliberations related to S. 462, the intelligence community and officials from the State and Homeland Security departments reportedly communicated concerns to Members and committees of Congress that easing the requirements for Israel to enter the visa waiver program could make the United States more vulnerable to Israeli espionage, particularly industrial espionage. In response to these reported concerns, Israeli officials have flatly denied that Israel conducts espionage in the United States.214

    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

    Israel's Nuclear Status and Nonproliferation217

    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

    Bilateral Trade Issues

    The United States is Israel's largest single-country trading partner,223 and—according to data from the U.S. International Trade Commission—Israel is the United States's 24th-largest trading partner.224 The two countries concluded a Free Trade Agreement (FTA) in 1985, and all customs duties between the two trading partners have since been eliminated. The FTA includes provisions that protect both countries' more sensitive agricultural sub-sectors with nontariff barriers, including import bans, quotas, and fees. Israeli exports to the United States have grown since the FTA became effective. Qualified Industrial Zones (QIZs) in Jordan and Egypt are considered part of the U.S.-Israel free trade area. In 2013, Israel imported approximately $15 billion in goods from and exported $23 billion in goods to the United States.225 The United States and Israel have launched several programs to stimulate Israeli industrial and scientific research, for which Congress has authorized and appropriated funds on several occasions.226

    186 U.S. Policy

    U.S. policy on settlements has varied since 1967. Until the 1980s, multiple Administrations either stated or implied that settlements were "contrary to international law," with President Carter's Secretary of State Cyrus Vance stating explicitly that settlements were "illegal" in 1980.187 President Reagan later stated that settlements were "not illegal," but "ill-advised" and "unnecessarily provocative." Since then, the executive branch has generally refrained from pronouncements on the settlements' legality.188 A common U.S. stance has been that settlements are an "obstacle to peace." A former U.S. official has written that U.S. Administrations are "not entirely sure what to do with the fact that Israeli prime ministers of all political stripes have continued Israeli settlement building on the West Bank and construction in parts of east Jerusalem that we'd like to see become the capital of a Palestinian state."189 Loan guarantees to Israel currently authorized by U.S. law are subject to possible reduction by an amount equal to the amount Israel spends on settlements in the occupied territories. The executive branch made its most recent reduction in FY2005.190

    An April 2004 letter from President George W. Bush to then Israeli Prime Minister Ariel Sharon explicitly acknowledged that "in light of new realities on the ground, including already existing major Israeli populations (sic) centers, it is unrealistic to expect that the outcome of final status negotiations will be a full and complete return to the armistice lines of 1949." Partly because of such statements from U.S. policymakers, critics routinely charge that U.S. support of Israel indirectly supports settlement activity.

    Like other Administrations, the Obama Administration has faced challenges in approaching this issue. In the context of its initial attempts to restart the peace process between Israelis and Palestinians, the Administration called for Israel to totally freeze all settlement activity, including in East Jerusalem. In his speech in Cairo in May 2009, President Obama said, "The United States does not accept the legitimacy of continued Israeli settlements. This construction violates previous agreements and undermines efforts to achieve peace. It is time for these settlements to stop."191 PLO leaders followed suit and made a settlement freeze a precondition for their return to the peace talks. Israel responded with a partial 10-month moratorium, but tentative efforts to restart negotiations did not take hold during that time. In February 2011, the United States vetoed a draft U.N. Security Council resolution that would have characterized Israeli settlements in the West Bank and East Jerusalem as illegal. All other 14 members of the Council, including the United Kingdom, France, and Germany, voted for the draft resolution. Susan Rice, then the U.S. Permanent Representative to the United Nations, clarified that the Administration still opposed settlement construction as illegitimate and at cross-purposes with peace efforts,192 and this remains stated U.S. policy.193

    President Obama has signed trade and customs legislation during the 114th Congress (P.L. 114-26 and P.L. 114-125) that opposes punitive economic measures against Israel (such as measures advocated by a non-governmental boycott, divestment, and sanctions [BDS] movement). However, the Administration has asserted—including in a presidential signing statement for P.L. 114-125—that certain provisions in the legislation that seek to treat "Israeli-controlled territories" beyond 1949-1967 armistice lines (including West Bank settlements) in the same manner as Israel itself are not in line with U.S. policy.194

    In July 2016, the United States and other members of the international Quartet released a report saying, among other things, that the "continuing policy of settlement construction and expansion, designation of land for exclusive Israeli use, and denial of Palestinian development is steadily eroding the viability of the two-state solution."195 In September 2016, Quartet representatives released a statement reiterating their opposition to settlement construction and expansion, and further specifying concerns with regard to such activities "in Area C and East Jerusalem, including the retroactive 'legalization' of existing units."196

    In response to reports that Israel had begun a process that might relocate residents of the Amona outpost, which lies on privately owned Palestinian land, to other privately owned Palestinian lands deemed abandoned by the owners,197 a State Department spokesperson said in an August 11, 2016, daily press briefing:

    This would represent an unprecedented and troubling step that's inconsistent with prior Israeli legal opinions and counter to longstanding Israeli policy to not seize private Palestinian land for Israeli settlements. If this moves ahead, it would effectively create a new settlement or significantly expand the footprint of an existing settlement deep in the West Bank. This is a continuation of a process that has seen some 32 outposts that are illegal under Israeli law being legalized in recent years.

    Later, in September 2016, Netanyahu released a video on Facebook characterizing Palestinian leaders' opposition to having settlers within the borders of a future Palestinian state as tantamount to ethnic cleansing. The video prompted the following response from a State Department spokesperson:

    We obviously strongly disagree with the characterization that those who oppose settlement activity or view it as an obstacle to peace are somehow calling for ethnic cleansing of Jews from the West Bank. We believe that using that type of terminology is inappropriate and unhelpful.198

    Appendix A. U.S.-Based Interest Groups Relating to Israel

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

    American Israel Public Affairs Committee: http://www.aipac.org

    American-Israeli Cooperative Enterprise/Jewish Virtual Library: http://www.jewishvirtuallibrary.org

    American Jewish Committee: http://www.ajc.org

    American Jewish Congress: http://www.ajcongress.org

    Americans for Peace Now: http://www.peacenow.org

    Anti-Defamation League: http://www.adl.org

    Conference of Presidents of Major Jewish Organizations: http://www.conferenceofpresidents.org

    Foundation for Middle East Peace: http://www.fmep.org

    Hadassah (The Women's Zionist Organization of America, Inc.): http://www.hadassah.org

    Israel Bonds: http://www.israelbonds.com

    Israel Institute: http://www.israelinstitute.org

    The Israel Project: http://www.theisraelproject.org

    Israel Policy Forum: http://www.israelpolicyforum.org

    J Street: http://jstreet.org

    Jewish Federations of North America: http://www.jewishfederations.org

    Jewish National Fund: http://www.jnf.org

    Jewish Policy Center: http://www.jewishpolicycenter.org

    New Israel Fund: http://www.nif.org

    S. Daniel Abraham Center for Middle East Peace: http://www.centerpeace.org

    Zionist Organization of America: http://www.zoa.org

    Appendix B. Descriptions of Israeli Knesset Parties and Their Leaders

    COALITION

     

    Likud (Consolidation)30 seats
    Israel's historical repository of right-of-center nationalist ideology; skeptical of territorial compromise; has also championed free-market policies.

    Leader: Binyamin Netanyahu
    Born in 1949, Netanyahu has served as prime minister since 2009 and also was prime minister from 1996 to 1999. Netanyahu served in an elite special forces unit (Sayeret Matkal), and received his higher education at MIT. Throughout a career in politics and diplomacy, he has been renowned both for his skepticism regarding the exchange of land for peace with the Palestinians and his desire to prevent Iran from acquiring a nuclear weapons capability. He is generally regarded as both a consummate political dealmaker and a security-minded nationalist. However, he has negotiated with the Palestinians (including signing the Wye River Memorandum in 1998 and allowing for the signing of the Hebron Protocol in 1997). Despite engaging in two conflicts with Gaza-based Palestinian militants in 2012 and 2014, many observers discern cautiousness in Netanyahu's decisions regarding the nature and scale of military operations.

     

    Kulanu (All of Us)10 seats
    New pro-secular, center-right party focusing largely on socioeconomic issues.

    Leader: Moshe Kahlon
    Born in 1960, Kahlon is Israel's finance minister. While serving as communications minister from 2009 to 2013 as a Likud member, Kahlon gained notoriety and popularity for liberalizing the mobile phone market and bringing down costs. He then served as welfare minister before choosing not to run in the 2013 elections and later re-emerging at the head of Kulanu in late 2014.

     

    Ha'bayit Ha'Yehudi (The Jewish Home)8 seats
    Right-of-center nationalist party with base of support among religious Zionists (Ashkenazi Orthodox Jews); includes core constituencies supporting West Bank settlements and annexation.

    Leader: Naftali Bennett
    Born in 1972, Bennett is Israel's education minister and served as economy minister in the previous government. He served in various special forces units (including as a reservist during the 2006 Hezbollah conflict in Lebanon). Bennett was a successful software entrepreneur and has lived in America. He served as Netanyahu's chief of staff from 2006 to 2008 while Netanyahu was opposition leader. He led the Yesha Council (the umbrella organization for Israeli West Bank settlers) from 2010 to 2012, and then became leader of Ha'bayit Ha'Yehudi shortly before the 2013 elections.

     

    Shas (Sephardic Torah Guardians)7 seats
    Mizrahi Haredi ("ultra-Orthodox") party; favors welfare and education funds in support of Haredi lifestyle; opposes compromise with Palestinians on control over Jerusalem.

    Leader: Aryeh Deri
    Born in 1959, Deri is Israel's economy ministerinterior minister and minister for Negev and Galilee development. He led Shas from 1983- to 1999 before being convicted for bribery, fraud, and breach of trust in 1999 for actions taken while serving as interior minister. Returned as party's leader in 2013.

    He returned as the party's leader in 2013. Deri originally served as the current government's economy minister, but reported differences with Prime Minister Netanyahu over government dealings with private natural gas consortiums led to his resignation from that office.
     

    United Torah Judaism6 seats
    Ashkenazi Haredi coalition (Agudat Yisrael and Degel Ha'torah); favors welfare and education funds in support of Haredi lifestyle; opposes territorial compromise with Palestinians and conscription of Haredim; generally seeks greater application of Jewish law.

    Leader: Yaakov Litzman
    Born in 1948, Litzman leadsis Israel's health ministry as its deputy minister. He was born in Germany and raised in the United States before immigrating to Israel in 1965. Educated in yeshivas (traditional Jewish schools), he later served as principal of a Hasidic girls' school in Jerusalem. He was first elected to the Knesset in 1999 and has previously served as deputy health minister and as a member of the Knesset's finance committee.

      Yisrael Beiteinu (Israel Our Home)—5 seatsPro-secular, right-of-center nationalist party with base of support among Russian speakers from the former Soviet Union. Leader: Avigdor Lieberman Born in 1958, Lieberman is Israel's defense minister, and upon his appointment to this position he resigned his Knesset seat. He served as Israel's foreign minister for most of the period from 2009 to May 2015 and is generally viewed as an ardent nationalist and canny political actor with prime ministerial aspirations. He and Yisrael Beiteinu were in opposition to the current government before joining it in May 2016. Lieberman was born in the Soviet Union (in what is now Moldova) and immigrated to Israel in 1978. He worked under Netanyahu from 1988 to 1997. Disillusioned by Netanyahu's willingness to consider concessions to the Palestinians, Lieberman founded Yisrael Beiteinu as a platform for former Soviet immigrants. He and other members of his party have faced corruption allegations, but he was acquitted in a 2013 case.

    OPPOSITION

     

    Zionist Union24 seats
    Joint list of Avoda (Labor) and Ha'tnua (The Movement). Labor is Israel's historical repository of social democratic, left-of-center, pro-secular Zionist ideology; both Labor and Ha'tnua are associated with efforts to end Israel's responsibility for Palestinians in the West Bank and Gaza.

    Leader: Yitzhak Herzog
    Born in 1960, Herzog was elected leader of the Labor party in 2013 and, for the March 2015 elections, combined with Tzipi Livni of Ha'tnua to form the Zionist Union. His father Chaim served as an Israeli general, diplomat, and president. Herzog spent part of his early life in New York, and later served in Israeli military intelligence and embarked on a career in law in Tel Aviv. He has headed a number of ministerial portfolios in past coalition governments (housing, welfare, diaspora, tourism). As leader of the opposition, Herzog seeks to draw contrasts with Netanyahu on his positions regarding management of the economy and relations with the United States, the Palestinians, and the international community.

     

    Joint List13 seats
    Joint list of four Arab Israeli parties (Hadash, Ra'am, Ta'al, and Balad) that include socialist, Islamist, and Arab nationalist political strains.

    Leader: Ayman Odeh
    Born in 1975, Odeh is the leader of the Joint List and of Hadash, an Arab Israeli socialist party. An attorney, he served on the Haifa city council before becoming Hadash's national leader in 2006. Supports a more democratic, egalitarian, and peace-seeking society, and has sought protection for unrecognized Bedouin villages and advocated for drafting young Arab Israelis for military or civilian national service.

     

    Yesh Atid (There Is a Future)11 seats
    Pro-secular, centrist party focusing largely on socioeconomic issues.

    Leader: Yair Lapid
    Born in 1963, Lapid served as Israel's finance minister from 2013 until the coalition government collapsed in December 2014. Like his father Tommy, Lapid has parlayed a journalistic career into electoral success. Lapid's effort to end the widespread exemption from military service for Haredim, one of the key organizing principles for the government, was enacted into legislation in 2014. However,, though it remains largely unimplemented. Lapid's popularity fell during his time as finance minister, presumably because the government faced continuing challenges in improving cost-of-living and economic inequality issues while maintaining fiscal discipline.

     

    Yisrael Beiteinu (Israel Our Home). Opposition
    Pro-secular, right-of-center nationalist party with base of support among Russian speakers from the former Soviet Union.

    Leader: Avigdor Lieberman
    Born in 1958, Lieberman served as Israel's foreign minister for most of the period from 2009 to May 2015 and is generally viewed as an ardent nationalist and canny political actor with prime ministerial aspirations. He chose to join the opposition to the current government, perhaps in hopes of hastening its demise. He was born in the Soviet Union (in what is now Moldova) and immigrated to Israel in 1978. Lieberman worked under Netanyahu from 1988 to 1997. Disillusioned by Netanyahu's willingness to consider concessions to the Palestinians, Lieberman founded Yisrael Beiteinu as a platform for former Soviet immigrants. He and other members of his party have faced corruption allegations, but he was acquitted in a 2013 case2016 polls indicate that Lapid has regained popularity, largely at the expense of the Zionist Union.

     

    Meretz (Vigor)5 seats
    Left-of-center, pro-secular Zionist party that supports initiatives for social justice and for peace with the Palestinians

    Leader: Zehava Gal-On
    Born in 1956, Gal-On became Meretz's leader in 2012 and was first elected to the Knesset in 1999. She previously directed the B'Tselem human rights organization. She was born in the Soviet Union (in what is now Lithuania) and immigrated with her family to Israel in 1960.

    Source: All photos and party logos, and much of the information in this table, were taken from Open Source Center, "Israel—Election Guide 2015," LIL2015022454931245, February 25, 2015.

    Natural Gas Resources and Export Possibilities227

    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.

    Figure C-1. Eastern Mediterranean Energy Resources Map

    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)."

    Figure C-2. Israel's Primary Energy Consumption Mix

    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.

    Figure C-3. Israel's Natural Gas Production, Imports, and Consumption

    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

    • West Bank and Gaza: The Palestinian Authority (PA) and the Leviathan consortium led by Noble Energy reached agreement in January 2014 on a 20-year supply of gas to a proposed power plant in the West Bank city of Jenin when Leviathan comes online.239 Analysts have speculated on the possibility for Israeli gas or gas from the PA-administered Marine (sometimes known as "Marine A") field to supply the Gaza Strip's energy-starved power plant.240 Political and security concerns, particularly Hamas's presence in Gaza, have complicated this issue. Depending on a number of variables, potentially reunified PA rule over the West Bank and Gaza might either present opportunities to make energy arrangements for the Gaza plant, or lead to further obstacles. Uncertainty regarding Israeli-Palestinian relations and the PA's future could affect Israeli control over offshore resources and the shipment of gas from these resources to the West Bank and Gaza.
    • Jordan: Jordan and the Leviathan consortium signed a preliminary agreement in September 2014 to supply gas to Jordan's national power company over 15 years,241 after the Tamar consortium reached agreement with Jordan in February 2014 on a 15-year deal242 to supply gas to Jordanian potash and bromine factories near the Dead Sea shore. However, Jordan reportedly suspended talks on the Leviathan deal in January 2015 due to the ongoing Israeli antitrust dispute.243 Israel may seek natural gas agreements with Jordan in hopes of optimizing current and future relations with it at a time when regular sabotage to Egypt's pipeline has disrupted Jordan's primary gas source, and Jordanian leaders are searching for a reliable alternative.244 However,
    • Egypt: According to the Financial Times, the Tamar consortium signed a letter of intent in May 2014 to provide a 15-year supply of gas to an LNG plant on the Nile Delta run by a joint venture between Spanish and Italian firms, with Noble Energy expecting to sign a subsequent binding agreement.245 Reportedly, the Leviathan consortium signed a June 2014 memorandum of understanding with Britain's BG Group246 to supply gas that would restore operations at another LNG plant in Egypt.247 Egypt is reportedly willing to approve the potential deal "if the parties involved agree to help meet the country's domestic demand at a reasonable price."248 Additionally, in March 2015, the Tamar consortium signed a seven-year deal to provide gas to private Egyptian industrial customers.249 Although Egypt has its own natural gas reserves, subsidy-driven domestic demand and political instability have reduced its production and export capacity and prevented the foreign-owned LNG plants from meeting their export obligations.250 In addition to possibly importing natural gas from Israel, Egypt has made plans for a floating LNG import terminal that could receive gas from other exporters, such as Qatar (the world's largest LNG exporter).
    • Turkey: A potential energy pipeline to Turkey from Israeli offshore gas fields could be extremely lucrative by feeding Turkey's increasing energy demand. It could also be geopolitically advantageous for Europe by possibly increasing Turkey's value as an energy transport hub that could provide an alternative to Russian-origin gas.251 However, Israel-Turkey relations continue to face difficulties, which could present obstacles to an energy deal.252 This may be partly due to possible divergences in the two countries' interests amid regional tension and unpredictability, and partly due to recurring anti-Israel (and arguably anti-Semitic) pronouncements from Turkish President (formerly Prime Minister) Recep Tayyip Erdogan and his circle of advisors and media supporters.253 Additionally, because technical factors may require that a pipeline from Israel's offshore fields to Turkey traverses Cyprus's territorial waters, any Israel-Turkey deal might be contingent on substantial progress toward resolving or mitigating the decades-long dispute between Cyprus's ethnic Greek and ethnic Turkish communities.

    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.

    U.S. officials are working with Lebanese and Israeli leaders to resolve the dispute.256 Lebanon objects to a 2010 Israel-Cyprus agreement that draws a specific maritime border delineation point relative to the 1949 armistice line that serves as their de facto border, and claims roughly 330 square miles of waters that overlap with areas claimed by Israel (see Figure C-1 above).257

    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].

    Note: One Knesset member, Orly Levi-Abekasis, is an independent member of the opposition, having left Yisrael Beiteinu in May 2016 when it joined the coalition.

    Author Contact Information

    [author name scrubbed], Specialist in Middle Eastern Affairs ([email address scrubbed], [phone number scrubbed])

    Footnotes

    .

    86. 92. 116. 138. 143. 162. 165. 178. 187. "Mahmoud Abbas: It's Israel that's 'carrying out ethnic cleansing,'" Ynetnews and Reuters, September 11, 2016.
    1.

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

    2.

    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.

    3.

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

    4.
    4.

    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.

    5.

    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).

    6.

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

    7.

    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.

    85.

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

    96.

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

    107.

    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," ReutersReuters, March 19, 2013. Historically, Israeli prime ministers (including Netanyahu) have appeared to preferdemonstrated a preference for 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.

    118.

    Toby Greene, "Opinion: How Netanyahu did it again," Jewish News Online (UK), March 18, 2015Mazal Mualem (translated from Hebrew), "How the once-moderate Likud was radicalized," Al-Monitor Israel Pulse, April 8, 2016.

    129.

    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"Herzog: Reports of progress toward unity government 'a complete lie,'" Times of Israel, October 4, 2016.

    13.

    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).

    14.

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

    15.

    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.

    16.

    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.

    17.

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

    18.

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

    19.

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

    20.

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

    21.

    Guttman, op. cit.

    22.

    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.

    23.

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

    24.

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

    25.

    IMF World Economic Outlook database, April 2015.

    26.

    Ibid.

    27.

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

    28.

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

    29.

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

    30.

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

    31.

    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.

    32.

    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.

    33.

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

    34.

    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].

    35.

    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.

    36.

    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.

    37.

    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.

    38.

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

    39.

    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.

    40.

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

    41.

    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.

    42.

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

    43.

    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. 

    44.

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

    45.

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

    46.

    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.

    47.

    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.

    48.

    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.

    49.

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

    50.

    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.

    51.

    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.

    52.

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

    53.

    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.

    54.

    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.

    55.

    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.

    56.

    Opall-Rome, op. cit.

    57.

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

    58.

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

    59.

    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.

    60.

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

    61.

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

    62.

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

    63.

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

    64.

    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.

    65.

    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].

    66.

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

    67.

    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.

    68.

    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."

    69.

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

    70.

    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.

    71.

    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.

    72.

    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.

    73.

    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.

    74.

    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.

    75.

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

    76.

    "'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].

    77.

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

    78.

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

    79.

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

    80.

    Ibid.

    81.

    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.

    82.

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

    83.

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

    84.

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

    85.

    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.

    86.

    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.

    87.

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

    88.

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

    89.

    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;

    90.

    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.

    91.

    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.

    92.

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

    93.

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

    94.

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

    95.

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

    96.

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

    97.

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

    98.

    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.

    99.

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

    100.

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

    101.

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

    102.

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

    103.

    "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.

    104.

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

    105.

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

    106.

    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.

    107.

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

    108.

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

    109.

    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.

    110.

    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.

    111.

    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.

    112.

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

    113.

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

    114.

    "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.

    115.

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

    116.

    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.

    117.

    Bruck, op. cit.

    118.

    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.

    119.

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

    120.

    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.

    121.

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

    122.

    Ibid.

    123.

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

    124.

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

    125.

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

    126.

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

    127.

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

    128.

    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.

    129.

    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].

    130.

    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.

    131.

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

    13210.

    Ben Caspit, "Is Bibi's massive fundraising network about to collapse?" Al-Monitor Israel Pulse, July 20, 2016. According to one source, "Ehud Olmert, Mr Netanyahu's predecessor as prime minister, was forced to resign in 2009 over bribery allegations and is now serving a 19-month sentence in prison, while possibly facing further convictions." "Israel's prime minister: The law looms larger," Economist, July 16, 2016:

    11.

    "Israeli military finds its independent voice under attack," Christian Science Monitor, May 9, 2016.

    12.

    The shooter, Sgt. Elor Azaria, is being tried for manslaughter in an Israeli military court amid controversy over whether the shooter might have reasonably believed that the wounded Palestinian presented a threat.

    13.

    "Israel Defense Minister Moshe Yaalon Quits, Says Can't Trust PM Netanyahu," Associated Press, May 20, 2016.

    14.

    Judah Ari Gross, "Barak flogs Netanyahu, laments 'budding fascism' in Israel," Times of Israel, June 16, 2016.

    15.

    "After contentious debate, Knesset passes NGO law," Times of Israel, July 12, 2016.

    16.

    Ruth Levush, "Israel: Laws Authorize Expulsion of Lawmakers Engaged in Incitement to Racism or Support of Armed Struggle Against the State," Law Library of Congress Global Legal Monitor, July 21, 2016.

    17.

    "Knesset passes law allowing expulsion of lawmakers," Jewish Telegraphic Agency, July 20, 2016.

    18.

    Based on data from the International Monetary Fund's World Economic Outlook Database, April 2016.

    19.

    Ibid.

    20.

    Economist Intelligence Unit, Country Report: Israel, generated September 6, 2016.

    21.

    OECD, In It Together: Why Less Inequality Benefits All, 2015, p. 20; OECD, Economic Policy Reforms 2015: Going for Growth, pp. 223-226.

    22.

    Ibid.

    23.

    See, e.g., Neri Zilber, "A Nice, Relaxing Weekend in the Sights of Hezbollah," Tablet, July 12, 2016; Avi Isaacharoff, "10 years after the Second Lebanon War, Israel isn't in Hezbollah's sights," Times of Israel, July 14, 2016; William Booth, "Ten years after last Lebanon war, Israel warns next one will be far worse," Washington Post, July 23, 2016.

    24.

    For information on various potential threats to Israel's security, see testimony from a House Foreign Affairs Middle East and North Africa Subcommittee hearing dated April 19, 2016, available at https://foreignaffairs.house.gov/hearing/joint-subcommittee-hearing-israel-imperiled-threats-to-the-jewish-state/; and Robert M. Danin, "Israel Among the Nations," Foreign Affairs, July/August 2016.

    25.

    Yossi Melman, "Intelligence Report: Israel's strategic position has improved," Jerusalem Report, March 5, 2016.

    26.

    Israel is not a party to the Nuclear Nonproliferation Treaty (NPT) and maintains a policy of "nuclear opacity" or amimut. A 2014 report examining data from a number of sources through the years estimated that Israel possesses an arsenal of around 80 nuclear weapons. Hans M. Kristensen and Robert S. Norris, "Israeli nuclear weapons, 2014," Bulletin of the Atomic Scientists, vol. 70(6), 2014, pp. 97-115. 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. Eli Lake, "Secret U.S.-Israel Nuclear Accord in Jeopardy," Washington Times, May 6, 2009.

    27.

    Kristensen and Norris, op. cit.; "Strategic Weapon Systems," Jane's Sentinel Security Assessment – Eastern Mediterranean, March 11, 2016; "Operation Samson: Israel's Deployment of Nuclear Missiles on Subs from Germany," Der Spiegel, June 4, 2012.

    28.

    "Israel Defence Budget," Jane's Defence Budgets, January 21, 2016. For purposes of comparison, IHS Jane's reports that the U.S. defense budget totals close to $625 billion annually, constituting approximately 3.3% of total GDP.

    29.

    "Israel approves additional section of Jordan border fence: report," i24news, July 19, 2016; Barbara Opall-Rome, "Israel Invests Billions in Border Barricades," Defense News, September 7, 2015.

    30.

    Michael Herzog, "Israel Confronts the Iran Nuclear Deal," Washington Institute for Near East Policy, PolicyWatch 2455, July 24, 2015.

    31.

    Danin, op. cit.

    32.

    David E. Sanger, "A Year Later, a Mixed Record for the Iran Accord," New York Times, July 14, 2016.

    33.

    Carmit Valensi and Udi Dekel, "The Current Challenges in the Middle East Demand a Joint United States-Israel Strategy," Strategic Assessment, vol. 19, no. 1, April 2016. See also Sanger, op. cit.

    34.

    U.S. Treasury Department Press Release, "Treasury Sanctions Those Involved in Ballistic Missile Procurement For Iran," January 17, 2016.

    35.

    Barbara Opall-Rome, "Experts: Israel Lacks Leverage Against Iranian Missile Tests," Defense News, March 14, 2016.

    36.

    Valensi and Dekel, op. cit.

    37.

    Joe Gould, "US Lawmakers Urge Action on Jet Sales to Qatar, Kuwait and Bahrain," Defense News, July 12, 2016.

    38.

    Parisa Hafezi, "Iran deploys Russian-made S-300 missiles at its Fordow nuclear site: TV," Reuters, August 29, 2016.

    39.

    See, e.g., Yuval Azulai, "Israel, US conduct joint missile defense trial," Globes, July 6, 2016.

    40.

    See, e.g., "Israel has hit 'dozens' of Hezbollah arms transfers, Netanyahu says," Times of Israel, April 11, 2016; Anne Barnard, "Lebanon: New Skirmish Between Israel and Hezbollah in Disputed Territory," New York Times, January 5, 2016.

    41.

    Isabel Kershner, "Netanyahu Welcomes Cease-Fire in Syria, but Adds a Warning," New York Times, February 29, 2016.

    42.

    See, e.g., Barbara Opall-Rome, "Israel, Russia Conclude First Round of Deconfliction Talks," Defense News, October 7, 2015.

    43.

    Barak Ravid, "Israel Asks Russia to Revise Military Coordination Due to New Russian S-300 Missiles in Syria," haaretz.com, October 17, 2016; Amos Harel, "Without Effort, Russia Restricted the Strongest Air Force in the Middle East," haaretz.com, October 23, 2016.

    44.

    Nazir Majli, "Russia Admits Drone Entered Israeli Airspace," Asharq al Awsat Online, August 8, 2016.

    45.

    Micah Halpern, "Swaggering Syria Shoots at Israeli Jets, Flying Toward War?" observer.com, September 15, 2016.

    46.

    William Booth, "Ten years after last Lebanon war, Israel warns next one will be far worse," washingtonpost.com, July 23, 2016; Identical letters dated May 27, 2015, from the Permanent Representative of Israel to the United Nations addressed to the Secretary-General and the President of the Security Council, U.N. Document S/2015/382, May 27, 2015; Isabel Kershner, "Israel Says Hezbollah Military Sites Put Lebanese Civilians at Risk," New York Times, May 13, 2015. Adam Entous, et al., "Hezbollah Upgrades Missile Threat to Israel," Wall Street Journal, January 2, 2014.

    47.

    See, e.g., Booth, "Ten years after last Lebanon war…," op. cit.; Neri Zilber, "Hezbollah Claims a 'Nuclear Option' in Tense Standoff with Israel," Daily Beast, March 3, 2016; Amos Harel, "Israel's Unlikely Place in a Rapidly Changing Middle East," haaretz.com, March 7, 2016.

    48.

    Harel, "Without Effort, Russia Restricted the Strongest Air Force in the Middle East," op. cit.; Nour Samaha, "Hezbollah's Death Valley," foreignpolicy.com, March 3, 2016.

    49.

    Isabel Kershner, "Beyond Borders, Israel Sees a New World of Chaos, Tunnels and Terror," New York Times, February 12, 2016; "Israel and Islamic State: The caliphate eyes the holy land," Economist, January 23, 2016; David Ignatius, "In Middle East, a Serious Game of War," Washington Post, January 27, 2016.

    50.

    See footnote 29.

    51.

    See, e.g., Alex Fishman, "Hamas is funding Islamic State in Sinai," Ynetnews, December 14, 2015; Ronen Bergman, "The battle over Sinai: ISIS's next strong force," Ynet Magazine, December 25, 2015.

    52.

    See, e.g., "Kosher Copenhagen deli targeted in anti-Semitic attack," Times of Israel, April 9, 2015; "Brussels Jewish Museum killings: Suspect 'admitted attack,'" BBC News, June 1, 2014.

    53.

    "Islamic State head: 'Palestine will be graveyard' for Jews," Times of Israel, December 26, 2015; jpost.com, "ISIS in Sinai threatens Jews, Israel and Rome in new video," August 3, 2016.

    54.

    See, e.g., Will McCants, "ISIS and Israel," jihadica.com, November 6, 2015; Isabel Kershner and Diaa Hadid, "5 Palestinian Israelis, Said to Be ISIS Supporters, Are Held," New York Times, December 10, 2015.

    55.

    Avi Isaacharoff, "Egypt to expand Gaza buffer zone to up to 2 kilometers," Times of Israel, January 6, 2015. Albaraa Abdullah, "Did Egypt flood tunnels at Israel's request?" Al-Monitor Egypt Pulse, February 24, 2016.

    56.

    See, e.g., David Wainer, et al., "Old Mideast Foes Unite Over Gas Deals and Fighting Militants," Bloomberg, July 10, 2016.

    57.

    In April 2016, Secretary of Defense Ash Carter notified Israel and Egypt that the United States was reviewing its participation in the Multinational Force and Observers mission in the Sinai Peninsula. Currently, there are about 700 U.S. personnel serving in the MFO out of an approximate total of 1,600. Richard Sisk, "US Reviewing Troop Presence in Sinai amid Increasing ISIS Threats," military.com, April 12, 2016.

    58.

    For information on Palestinian militants' capabilities in Gaza, see CRS Report RL34074, The Palestinians: Background and U.S. Relations, by [author name scrubbed].

    59.

    World Vision has raised concerns regarding the process and substance of the legal proceedings against its employee, while Amnesty International has said that there have been allegations that the World Vision employee confessed under duress. Joe Dyke, "World Vision urges Israel to try 'Hamas aid' case in public," Agence France Presse, August 30, 2016.

    60.

    "Israel Kills Palestinian Who Wounded Soldier in West Bank," Voice of America, September 17, 2016. Some U.S. citizens have been killed or injured, prompting the State Department to issue an August 23, 2016, security message to U.S. citizens for Israel, Jerusalem, and the West Bank (https://travel.state.gov/content/passports/en/alertswarnings/israel-travel-warning.html).

    61.

    Yoav Zitun, "Attack highlights West Bank infiltrators," Ynetnews, June 9, 2016.

    62.

    Israeli Prime Minister's Office, "PM Netanyahu Orders that Palestinian Authority Payments to Terrorists and their Families be Deducted from Tax Revenue Transfers to the PA," July 1, 2016. Israel periodically delays or withhold tax revenue transfers to the PA over security or political concerns or disputes. Palestinians and some international observers assert that the 1994 Paris Protocol governing such transfers does not permit Israeli delays or withholding. The PA transfers alluded to by the prime minister's office presumably refer to Palestinian payments to persons imprisoned by Israel for terrorism and those persons' families.

    In 2014, the Palestinians reportedly shifted the responsibility for making these payments from the PA to the Palestine Liberation Organization (PLO) budget, largely in order to defuse concerns among the PA's international donors about perceptions that the donors might be indirectly associated with the prisoner-related payments. CRS Report RS22967, U.S. Foreign Aid to the Palestinians, by [author name scrubbed].

    63.

    Yoav Zitun and Tova Tzimuki, "Lieberman unveils 'carrot and stick' plan against terror," Ynetnews, August 17, 2016.

    64.

    See, e.g., Uri Savir, "'Delegitimization war' heats up between Israel, Palestine," Al-Monitor Israel Pulse, August 28, 2016.

    65.

    Ruthie Blum, "Israel's Outgoing Foreign Ministry Chief Dispels 'Myth' of Jewish State's Diplomatic Isolation," Algemeiner, October 20, 2016.

    66.

    See, e.g., Lahav Harkov, "Netanyahu says Israel's image improving as he defends Foreign Ministry's diplomatic efforts," Jerusalem Post, July 26, 2016.

    67.

    In the incident, Israeli special forces boarded a private Turkish vessel (the Mavi Marmara) that was en route to Gaza to symbolically challenge Israel's blockade, and killed nine passengers in international waters (a tenth died later from his injuries) under disputed circumstances.

    68.

    CRS Report R41368, Turkey: Background and U.S. Relations, by [author name scrubbed] and [author name scrubbed].

    69.

    Many analysts assert that a Turkey-Israel pipeline would probably traverse Cypriot waters, thus necessitating an improvement in Turkish-Cypriot relations, if not a resolution to the decades-long dispute between Greek and Turkish Cypriots. Discussion of a pipeline may also attract the attention of Russia, currently Turkey's largest natural gas supplier.

    70.

    "Israel and Turkey: Let's try again," Economist, July 2, 2016.

    71.

    Yossi Melman, "A long way off," Jerusalem Report, August 8, 2016.

    72.

    Yaroslav Trofimov, "Israel Changes Tack to Regain Friends," Wall Street Journal, July 8, 2016.

    73.

    See, e.g., Jonathan Greenblatt, "US military aid to Israel makes sense for both countries," September 15, 2016. But see Richard Klass, "Is Israel Becoming a Strategic Liability?" War on the Rocks, January 28, 2015.

    74.

    See, e.g., Pew Research Center, Israel's Religiously Divided Society, March 8, 2016, available at http://www.pewforum.org/files/2016/03/Israel-Survey-Full-Report.pdf.

    75.

    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).

    76.

    "Netanyahu at War," PBS Frontline, January 4, 2016; Jason M. Breslow, "Dennis Ross: Obama, Netanyahu Have a 'Backdrop of Distrust,'" PBS Frontline, January 6, 2016; Sarah Moughty, "Michael Oren: Inside Obama-Netanyahu's Relationship," PBS Frontline, January 6, 2016.

    77.

    Dana H. Allin and Steven N. Simon, Our Separate Ways: The Struggle for the Future of the U.S.-Israel Alliance, New York: PublicAffairs, 2016.

    78.

    See, e.g., Susser, "Living in a post-American Middle East," op. cit.; Martin Kramer, "Israel and the Post-American Middle East," Foreign Affairs, July/August 2016; Dennis Ross, "Why Middle Eastern Leaders Are Talking to Putin, Not Obama," Politico, May 8, 2016.

    79.

    See, e.g., William Booth and Carol Morello, "Biden arrives in Israel to talk billions in military aid — and try to patch things up," washingtonpost.com, March 8, 2016; Greg Jaffe and Juliet Eilperin, "Obama's gulf gambit: More military aid to allies could ease regional rifts with Iran," washingtonpost.com, April 21, 2016.

    80.

    According to the European Commission's Directorate General for Trade, for 2014 the countries of the European Union accounted for 30.2% of Israel's total trade volume, while the United States accounted for 20.5%. Document available at http://trade.ec.europa.eu/doclib/docs/2006/september/tradoc_113402.pdf.

    81.

    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.

    82.

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

    83.

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

    84.

    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.

    85.

    See, e.g., Yossi Melman, "High Stakes Poker," Jerusalem Report, May 2, 2016.

    §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.

    13387.

    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.

    13488.

    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.

    13589.

    Israel Confident F-35 Won't Be Sold To Gulf In Near-Term," Defense News, April 25, 2016; John Hudson, "Israel: Go Ahead and Give the Gulfies Guns," foreignpolicy.com, May 13, 2015.

    13690.

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

    13791.

    Ran Dagoni, "Gulf states gain from new US-Israel aid package," Globes, September 19, 2016.

    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.

    138.

    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.

    13993.

    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."an April 2015 interview defending the terms of the upcoming JCPOA, said, "Number one, this is our best bet by far to make sure Iran doesn't get a nuclear weapon, and number two, what we will be doing even as we enter into this deal is sending a very clear message to the Iranians and to the entire region that if anybody messes with Israel, America will be there." Thomas L. Friedman, "Iran and the Obama Doctrine," New York Times, April 5, 2015. 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.

    14094.

    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.

    14195.

    Shmuel Even, "The Debate over Israel's Defense Budget," Strategic Assessment, March-April 2015.

    96.

    Josh Rogin, "U.S.-Israel deal held up over dispute with Lindsey Graham," washingtonpost.com, September 11, 2016.

    97.

    "Israel, US said to resolve key sticking points on aid deal," Times of Israel, August 1, 2016.

    98.

    White House, "FACT SHEET: Memorandum of Understanding Reached with Israel," September 14, 2016.

    99.

    Nathan Guttman, "ANALYSIS: $38B Israel Aid Deal Is Political Boon for Benjamin Netanyahu — and Barack Obama," Jewish Daily Forward, September 15, 2016. For information on debate regarding the MOU in Israel, see Yossi Melman, "An Unprecedented Deal?" Jerusalem Report, October 16, 2016.

    100.

    "Israel, US said to resolve key sticking points on aid deal," Times of Israel, August 1, 2016.

    101.

    Guttman, op. cit.; Peter Baker and Julie Hirschfeld Davis, "U.S. and Israel Seal Huge Military Aid Deal," New York Times, September 14, 2016.

    102.

    Josh Rogin, "Obama and Israel cut Congress out of the aid game," washingtonpost.com, September 14, 2016.

    103.

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

    104.

    "Israel Set to Build Wings for Some 800 F-35s," Reuters, August 30, 2010. According to UPI, "Israel Aerospace Industries produces wings, Elbit Systems Ltd. works on the Generation III helmet-mounted display system and the F-35 center fuselage composite components." Richard Tomkins, "Work underway on F-35 for Israel," United Press International, January 11, 2016.

    105.

    Yossi Melman, "Expensive War Toy," Jerusalem Report, August 22, 2016.

    106.

    Aharon Lapidot, "After F-35 makes aliyah, it will get new Israeli identity," Israel Hayom, May 2, 2016. "Adir" is a Hebrew expression for "mighty" or "powerful."

    107.

    See the Joint Explanatory Statement for Defense accompanying P.L. 114-113 at page 119-A, available at http://docs.house.gov/meetings/RU/RU00/20151216/104298/HMTG-114-RU00-20151216-SD004.pdf.

    108.

    Barbara Opall-Rome, "Israel Eyes US Funding To Detect, Destroy Hamas Tunnels," Defense News, April 18, 2016.

    109.

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

    110.

    Jen Judson, "Poland Wants Patriot With Different Battle Command System," Defense News, September 6, 2016.

    111.

    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.

    112.

    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 111th 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, 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.

    113.

    For background on the Leahy Law, see CRS Report R43361, "Leahy Law" Human Rights Provisions and Security Assistance: Issue Overview, coordinated by [author name scrubbed].

    114.

    See the text of the Members' February 17, 2016, letter to Secretary of State John Kerry at http://www.politico.com/f/?id=00000153-c56c-d662-a75b-cfecc6be0000.

    115.

    See the text of Assistant Secretary of State for Legislative Affairs Julia Frifield's April 18, 2016, response letter to Representative Henry C. Johnson at http://www.politico.com/f/?id=00000154-7c2f-d905-a357-7c7f04750000.

    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.

    142.

    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.

    143.

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

    144.

    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."

    145.

    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.

    146.

    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 some 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].

    147.

    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.

    148.

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

    149.

    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.

    150.

    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.

    151
    117.

    Azulai, op. cit.

    118.

    Dan Williams, "Israel to Deploy New 'David's Sling' Missile Shield in Mid-2016," Reuters, December 21, 2015.

    119.

    Azulai, op. cit. The trial reportedly included such Israeli missile defense assets as David's Sling, Arrow 2, and Arrow 3; and such U.S. assets as Patriot (of which, some batteries have been acquired by Israel), Terminal High Altitude Air Defense (THAAD), Aegis, and the radar station located in Israel's Negev Desert. The trial was a follow-up to the biennial bilateral "Juniper Cobra" joint military exercise.

    120.

    Conference report language accompanying P.L. 112-239, the 2013 National Defense Authorization Act; Section 234 of P.L. 113-66, the 2014 National Defense Authorization Act.

    121.

    Barbara Opall-Rome, "Israel Claims Intercept Success with Sea-Based Iron Dome," Defense News, May 18, 2016.

    122.

    Barbara Opall-Rome, "Still No Sales for Israel's Iron Dome," Defense News, June 14, 2016. See also Yaakov Lappin and Daniel Wasserbly, "US Army trials Israel's Iron Dome interceptor for new air defence system," IHS Jane's Defence Weekly, April 21, 2016.

    123.

    Singapore Ministry of Defense, "Reply to Media Queries on RSAF's MMR," April 11, 2016.

    124.

    Ben Makuch, "Canada Just Bought Israel's Iron Dome Radar Technology," Vice, July 29, 2015.

    125.

    Opall-Rome, "Still No Sales for Israel's Iron Dome," op. cit.

    126.

    Kristina Wong, "Tim Kaine backs call to boost funding for Israeli missile defense," The Hill, July 26, 2016.

    127.

    Both the House and the Senate versions would increase funding from Administration requested levels for Iron Dome from $42 million to $62 million, for David's Sling from $37.2 million to $266.5 million, for Arrow 2 from $10.8 million to $67.3 million, and for Arrow 3 from $55.8 million to $204.9 million. For some information on the Congress-Administration dynamics of the process regarding FY2017 funding, see Julian Pecquet, "Obama, Congress hurtle toward showdown over Israel missile defense," Al-Monitor Congress Pulse, April 27, 2016.

    128.

    https://www.whitehouse.gov/sites/default/files/omb/legislative/sap/114/saphr5293r_20160614.pdf?elqTrackId=6EC9CEC95DE185EB4389F47C7BDB2988&elq=b8956db884d14431acb7ea48bb94f526&elqaid=19132&elqat=1&elqCampaignId=11805.

    129.

    See, e.g., Michael Wilner, "The White House missile aid objection: An MOU negotiating tactic?" jpost.com, June 19, 2016.

    130.

    22 U.S.C. §2785.

    131.

    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.

    132.

    "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.

    133.

    Barbara Opall-Rome, "U.S. OKs Israel-China Spy Sat Deal," Defense News, October 12, 2007. This article quotes a U.S. official as saying, "We don't officially acknowledge our supervisory role or our de facto veto right over their exports.... It's a matter of courtesy to our Israeli friends, who are very serious about their sovereignty and in guarding their reputation on the world market."

    134.

    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 later acknowledged that Pollard had been its agent, granted him citizenship, and began petitioning the United States for his release. Pollard was released on parole in November 2015. 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.

    135.

    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.

    136.

    "Only Four of 20 Israeli Ministers Openly Declare Support of Two-state Solution," haaretz.com, June 27, 2016.

    137.

    Jonathan Lis, "Labor Adopts Herzog's Plan for Separation from Palestinians as Party Platform," haaretz.com, February 8, 2016.

    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.

    152139.

    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.

    153140.

    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].

    154141.

    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.

    155142.

    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.

    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.

    156144.

    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 151138.

    157145.

    See, e.g., "Don't forget what we lost, too," Economist, February 15, 2014. In the 112th 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.

    158146.

    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&amp;list=PLCapdZwzDpNlwSoHcbkXL9sMVbQcQMaQ-.

    159147.

    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.

    160148.

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

    161149.

    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.

    162150.

    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.

    163151.

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

    164152.

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

    165.

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

    166.

    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.

    167.

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

    168.

    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.

    169.

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

    170.

    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.

    171Uri Savir, "Obama's three diplomatic options for Mideast peace," Al-Monitor Israel Pulse, October 16, 2016. France hosted a June 2016 conference of foreign ministers (including Secretary of State Kerry) that reportedly established working groups to craft terms of reference for a possible future resumption of negotiations. Leslie Susser, "The Netanyahu enigma," Jerusalem Report, June 26, 2016.
    153.

    White House, Statement by the President on the Memorandum of Understanding Reached with Israel, September 14, 2016.

    154.

    Julie Hirschfeld Davis, "Obama Prods Netanyahu After Signing of U.S.-Israel Deal," New York Times, September 15, 2016.

    155.

    The text of the letter is available at https://www.gillibrand.senate.gov/newsroom/press/release/senators-gillibrand-and-rounds-lead-bipartisan-initiative-urging-president-obama-to-reject-and-if-needed-veto-any-one-sided-resolutions-at-the-united-nations. 394 Representatives signed a similar letter to President Obama in April 2016. Its text is available at http://kaygranger.house.gov/sites/granger.house.gov/files/Letter%20to%20President%20Obama%20supporting%20direct%20negotiations%20%E2%80%93%20signed%20by%20394%20Members%20of%20Congress_1.pdf.

    156.

    Zvi Magen and Udi Dekel, "Russia's Initiative on the Israeli-Palestinian Process: Another Move to Regain Influence in the Middle East," Institute for National Security Studies Insight No. 853, September 13, 2016.

    157.

    Susser, "The Netanyahu enigma," op. cit.

    158.

    See, e.g., Uri Savir (translated from Hebrew), "Have Arab leaders forgotten about Palestine?" Al-Monitor Israel Pulse, July 10, 2016.

    159.

    See, e.g., Bruce Maddy-Weitzman, "How far can they go?," Jerusalem Report, June 27, 2016. 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.

    160.

    Adnan Abu Amer (translated from Arabic), "Is the PA coordinating arrests with Israel?," Al-Monitor Palestine Pulse, April 28, 2016; Joshua Davidovich, "Days of death and destruction," Times of Israel, July 3, 2016.

    161.

    Ben Lynfield, "Creating chaos," Jerusalem Report, September 5, 2016.

    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.

    172163.

    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.

    173164.

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

    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.

    174166.

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

    175167.

    Pullan, op. cit., p. 37.

    176168.

    See, e.g., Nathan Thrall, "Rage in Jerusalem," London Review of Books, December 4, 2014 (initially published online November 21, 2014)State Department 2015 Report on International Religious Freedom, Israel and the Occupied Territories; Tova Dvorin, "Jordan Pushes Full Control Over Temple Mount, Israel Rejects," Arutz Sheva, October 19, 2015.

    177169.

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

    International Crisis Group, "How to Preserve the Fragile Calm at Jerusalem's Holy Esplanade," Middle East Briefing No. 48, April 7, 2016.
    178170.

    Herb Keinon, "Poll: 3 in 4 Israeli Jews oppose a Palestinian state if it means dividingFor text of the Executive Board resolution, see http://unesdoc.unesco.org/images/0024/002462/246215e.pdf. For information about the World Heritage Committee resolution, see Barak Ravid, "UNESCO Adopts Another Contentious Resolution on Jerusalem," haaretz Jerusalem," jpost.com, October 20, 201426, 2016.

    179171.

    Gil Ronen, "PM Calms Jordan: No Change in Temple Mount 'Status-Quo,'" Arutz Sheva, October 22, 2014Raoul Wootliff, "UNESCO's executive board adopts Jerusalem resolution," Times of Israel, October 18, 2016.

    180172.

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

    181.

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

    182.

    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].

    183Statement by the Director-General of UNESCO on the Old City of Jerusalem and its Walls, a UNESCO World Heritage site, October 14, 2016.
    173.

    State Department 2015 Report on International Religious Freedom, Israel and the Occupied Territories; David Hulme, "Insight: Two Men, One City," Vision, Spring 2007; Herb Keinon, "Abbas denies the Jewish connection to Jerusalem," jpost.com, August 22, 2012; Amir Shoan, "Is Israel losing Temple Mount war?" Ynetnews, February 25, 2012.

    174.

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

    175.

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

    176.

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

    177.

    For more about the case, see CRS Report R43773, Zivotofsky v. Kerry: The Jerusalem Passport Case and Its Potential Implications for Congress's Foreign Affairs Powers, 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.

    184179.

    CIA World Factbook estimates as of July 2014.

    185180.

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

    186181.

    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.

    187182.

    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.

    188183.

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

    The two agreements that define respective Israeli and PA zones of control in the West Bank (including Areas A, B, and C) are (1) the Israeli-Palestinian Interim Agreement on the West Bank and the Gaza Strip, dated September 28, 1995; and (2) the Protocol Concerning the Redeployment in Hebron, dated January 17, 1997. 184
    189.

    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.

    190185.

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

    186.

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

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

    191188.

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

    192189.

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

    193190.

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

    194191.

    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 iswas not bound by them. Ethan Bronner, "Israelis Say Bush Agreed to West Bank Growth," New York Times, June 3, 2009.

    195192.

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

    196193.

    White House Press Briefing, December 5, 2014.

    197194.

    See, e.g., a presidential signing statement for P.L. 114-125 (H.R. 644) at https://www.whitehouse.gov/the-press-office/2016/02/25/signing-statement-hr-644. For more information, see CRS Report R44281, Israel and the Boycott, Divestment, and Sanctions (BDS) Movement, coordinated by [author name scrubbed].

    195.

    The report, dated July 1, 2016, is available at http://www.state.gov/p/nea/rls/rpt/259262.htm. It also lamented terrorist attacks against civilians and Palestinian incitement to violence.

    196.

    The statement is available at http://www.state.gov/r/pa/prs/ps/2016/09/262344.htm.

    197.

    See, e.g., Isabel Kershner, "Bracing for Battle in a West Bank Outpost," New York Times, October 7, 2016.

    198.

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

    198.

    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.

    199.

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

    200.

    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.

    201.

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

    202.

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

    203.

    22 U.S.C. §2785.

    204.

    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.

    205.

    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.

    206.

    "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.

    207.

    Barbara Opall-Rome, "U.S. OKs Israel-China Spy Sat Deal," Defense News, October 12, 2007. This article quotes a U.S. official as saying, "We don't officially acknowledge our supervisory role or our de facto veto right over their exports.... It's a matter of courtesy to our Israeli friends, who are very serious about their sovereignty and in guarding their reputation on the world market."

    208.

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

    209.

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

    210.

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

    211.

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

    212.

    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.

    213.

    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 111th 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.

    214.

    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.

    215.

    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.

    216.

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

    217.

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

    218.

    See footnote 32.

    219.

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

    220.

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

    221.

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

    222.

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

    223.

    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.

    224.

    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.

    225.

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

    226.

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

    227.

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

    228.

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

    229.

    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.

    230.

    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.

    231.

    Noble Energy website, accessed November 7, 2014, http://investors.nobleenergyinc.com/.

    232.

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

    233.

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

    234.

    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

    235.

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

    236.

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

    237.

    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.

    238.

    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.

    239.

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

    240.

    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.

    241.

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

    242.

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

    243.

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

    244.

    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."

    245.

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

    246.

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

    247.

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

    248.

    Ibid.

    249.

    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.

    250.

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

    251.

    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.

    252.

    Solomon and Ben-David, op. cit.

    253.

    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.

    254.

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

    255.

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

    256.

    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.

    257.

    For additional information, see CRS Report R42816, Lebanon: Background and U.S. Policy, by [author name scrubbed]. See also James Stocker, "No EEZ Solution: The Politics of Oil and Gas in the Eastern Mediterranean," Middle East Journal, vol. 66, no. 4 (autumn 2012), pp. 579-597.