Why the MOU is a really BIG Deal

    This week the USA and Israel signed a renewal of the MOU, or The Memorandum of Understanding, which is a ten-year defense aid package that “constitutes the single largest pledge of bilateral military assistance in US history,” the State Department said Tuesday. 

     The $38 billion deal, scheduled to be signed this week in a ceremony at the State Department in Washington, replaces the previous $30 billion MOU that expires in 2018.

     With the new aid package Israel will receive $3.8 billion annually — up from $3 billion — starting in 2019 and through 2028.

     Unlike with the current MOU, Israel has pledged not to seek additional add-on military funding from Congress for the next decade, except in time of war. 

     The agreement also limits Israel’s current ability to spend part of the funds on its own arms industry — a key area of dispute during talks. Washington wanted Israel to spend a larger amount of the money on American-made products, creating more jobs in the US, while Israel wanted to feed its own “hungry tigers”. Currently, Israel can spend 26.3% of US military aid buying from its own domestic defense companies.

     Earlier reports said that Israel had asked for a separate, $400 million deal for missile defense spending — which could have raised the total amount to more than $4 billion annually. The US said no. “There was no higher figure ever discussed,” the former Israeli national security adviser Yaakov Amidror said Tuesday, describing the deal as “the best possible” accord.

     So why do I consider this to be such a BIG deal? Mainly because:

1. As mentioned above – it’s the largest bilateral military aid package granted by one country to another in history.

2. It comes at a time when the US economy is a hot and contentious election issue, and when the US is cutting painfully into its own defense spending on development, procurement and maintenance.

3. It shows that the mutually beneficial relations between the US and Israel on issues of security, regional stability, trust and co-reliance are as strong as ever.

4. It shows other Mideast and World players that the US is fully and unequivocally committed to the security and safety of Israel…not just in word. 

5. Its updated clauses on expanding existing agreements on military pre-positioning in Israel reaffirms General Alexander Haig’s famous observation that: “Israel is the largest American aircraft carrier in the world that cannot be sunk, does not carry even one American soldier, and is located in a critical region for American national security.”   

      As the Times of Israel pointed out in an article on Sunday: “The aid package is seen in Israel as key to helping it maintain its qualitative military edge over potential threats in the region, including from an emboldened Iran flush with cash after many nuclear-related sanctions were ended over the past year in a deal signed with world powers.”

     So despite arguments by frustrated politicians or wannabe analysts that Israel could have negotiated a better deal “if only…”, I think that this is a good deal that will benefit both Israel and The US in the decade to come.

     Kudos to the American and Israeli leaders that waded through disagreements, personality issues, political pressure and economic restrictions to reach this (to paraphrase Joe Biden) “#!!!!$%” Big Deal.”