July 29, 1997



The Middle East Peace Facilitation Act (MEPFA), the law which makes it possible for the U.S. to deal with and give aid to the Palestinian Authority, expires on August 12. Even so, the State Department was not forthcoming about its strategy, or even its intent, to get MEPFA renewed. Only now are rumors of their stealth strategy being heard - adding language for a short term extension into the report language of the House-Senate conference of the State Department Authorization bill. This will require a nod from the chairs of the authorizing committees, Sen. Helms and Rep. Gilman. The MEPFA section from the House-Senate report could then be brought to the floor as a free standing measure, for a late night voice vote before recess on August 1.

The fate of the State Department Authorization bill, which would pay part of the bill to the UN and reorganize State's agencies, is still unclear. The Administration objects to a number of the bill's provisions, including earmarking monies to move the embassy to Jerusalem, and is seeking changes by the House and Senate conferees. It's expected that the conference process will be completed before they leave town, with floor votes on the final product in September.


On the first anniversary of the Iran Libya Sanctions Act, House International Relations chair Ben Gilman hosted a hearing on July 23. The Administration claimed "success" in that no foreign firms have invested in Iran's energy sector and thus required State to prohibit them from doing business in the U.S. Gilman expressed frustration that the Administration is not interpreting as "sanctionable" either the extension of a new line of credit by France or the building of a pipeline across Iran to carry gas from Turkmenistan to Turkey. Rep. Hamilton, an oasis of reason, told Assistant Secretary of State David Welch that "it is now clear we'll make little progress [on changing Iran's behavior] unless we engage them in dialogue." That argument was laid out in the Washington Post on July 20 by a former assistant secretary of state, Richard Murphy. He pointed to the fact that for more than a decade, not a single US representative or senator has visited Tehran. Another voice for communication with Iran, the leader of Qater told Clinton during their June 10 talk that "you tried blocking Iran, but you couldn't make it." As for Iraq, another favorite enemy, Sheik Hamad of Qater said," I think the Iraqi people have suffered enough."

During the hearing, Reps Ackerman and Ros-Lehtinen held a press conference to release a statement supporting the isolation of Iran and lauding Maryam Rajavi of the Mujahidin-e Khalq. Their statement was signed by 225 Members of Congress, whose names are not being released. Why? Most likely because of objection raised at the press conference by Kenneth Timmerman, Director of the Foundation for Democracy in Iran.


President Clinton is backing up his pledge for a heightened role in promoting a resolution on Cyprus by appointing Richard Holbrook as Special Presidential Emissary for Cyprus. But Holbrook is not yet participating in the direct talks between Turkish and Cypriot leaders convened on July 9 by U.N. Secretary General Annan. A resolution of the Cyprus dispute would be a step in improving Turkey's international standing. But as long as the military continues to brutally repress the rights of the Kurdish minority, Turkey is subject for censure. US influence on Turkey can be expected to increase following the power shift back to secular parties and the military following the June 18th resignation of Prime Minister Erbakan, the first Islamist head of state for this avowedly secular state.


The New York Times in an July 28 editorial and the Wall Street Journal in a July 17 op-ed used the words "entitlement" and "subsidy" in reference to the annual $3 billion foreign aid to Israel. The Foreign Aid Appropriations bill has passed the Senate but probably won't make it to the House floor before adjournment. The bill includes a one-time shift of $50 million each from Israel and Egypt for an account directed to Jordan.

Here is a summary of aid to Israel and how it is spent: The Economic Support Fund grant of $1.2 billion, unlike aid going to most countries, is not for specified programs and is provided Israel in a lump sum at the beginning of each year. A large portion of ESF grant is used to repay loans owed to the U.S. government (about $400 million of the $1.2 B is to service this debt in FY97.) The Administration has requested that in 1998, $50 million of ESF will go in a fund for aid to Jordan along with $50 million from Egypt. The Foreign Military Sales grant of $1.8 billion is used for military purchases; a $475 million portion is authorized for expenditure in Israel for Israeli produced military items. Additionally, Israel receives $80 million a year in refugee settlement funds. The Defense spending bill, not yet passed, for FY98 includes U.S.-Israel cooperative missile defense programs including the Arrow which the Washington Times, on April 4, places at about $200 million over 5 years with a promise of a 25% increase. In addition, the Senate Appropriations Defense Subcommittee has provided $61M for procurement of specified military materials. This is the fifth and final year of the loan guarantee program under which Israel has borrowed $2B per year at lowered rates from commercial banks because of U.S. guarantees against default.


The Administration's request of $13.3 billion for foreign operations appropriations provides security and development assistance to some 126 countries and a dozen regional organizations for 1998. Security Assistance comprises nearly one-half of the foreign operations request.

FY98 SECURITY ASSISTANCE - 84.7% TO MIDDLE EAST, 48.9% TO ISRAEL (from Arms Sales Monitor, April 30, 1997 by the Federation of American Scientists Fund)

FY 1998 request for Security Assistance $6,132,250,000. Foreign Military Financing 3,340,250,000. Economic Support Fund 2,340,000,000. other 452,000,000.

Foreign Military Financing $3,340,250,000. grants Israel 1,800,000,000. Egypt 1,300,000,000. Jordan 45,000,000. Middle East: 94% of FMF total $3,145,000,000.

Economic Support Fund $2,497,600,000. Israel 1,200,000,000. Egypt 815,000,000. Jordan 25,000,000. Lebanon 12,000,000. Middle East: 82% of ESF total $2,052,000,000.

notes: ~ security assistance programs funded through the Department of Defense budget are not included here. ~ not included in Middle East totals: FMF to Turkey; Middle East portions of IMET (Military Training) and Anti-terrorism

Corinne Whitlatch, Director 110 Maryland Ave., NE, Suite 108 Washington, DC 20002

Corinne Whitlatch Churches for Middle East Peace (CMEP)