Middle East History: It Happened in August; Having Spent $1.75 Billion, U.S. Ends Funding of Israel's Failed Lavi Jet

By Neff, Donald | Washington Report on Middle East Affairs, August 31, 1995 | Go to article overview

Middle East History: It Happened in August; Having Spent $1.75 Billion, U.S. Ends Funding of Israel's Failed Lavi Jet


Neff, Donald, Washington Report on Middle East Affairs


MIDDLE EAST HISTORY: IT HAPPENED IN AUGUST; Having Spent $1.75 Billion, U.S. Ends Funding of Israel's Failed Lavi Jet

By Donald Neff

It was eight years ago, on Aug. 30, 1987, that Israel bowed to pressure from Washington to drop its effort to build its own advanced warplane, the Lavi. Despite Israeli claims to the contrary, the Lavi program was an embarrassing failure. 1 American and Israeli studies showed it was poorly designed, under-researched, behind schedule and vastly over budget. Moreover, a study had recently revealed that the United States had paid $1.75 billion, more than 90 percent of the Lavi's costs, and had contributed more than 50 percent of its technology. By contrast, Israel had invested only $133 million of its own funds. 2

The decision to terminate the Lavi was long in coming and welcome--if belated--news to some U.S. plane makers such as the Northrop Corporation. Northrop's chairman, Tom Jones, had been a consistent critic of the Israeli project ever since it was first embraced by the White House in early 1983. At the time, he had noted that it was unprecedented for the United States to finance a weapons program by a non-NATO foreign country and one that would be in direct competition on the world market with U.S. warplanes. But, more specifically, he was unhappy because since 1980 a presidential directive had established that although there was a need for a new U.S. fighter plane, the White House had decided that "the U.S. Government will not provide funding for development of the aircraft, and aircraft companies will assume all financial and market risks."

Jones noted that Northrop had accepted the directive and invested its own funds to develop the F-20 Tigershark--around $600 million, far more than Israel contributed to the Lavi. But, he added, "the development of a Lavi fighter program, supported by U.S. technology and U.S. funds, clearly changes the market risks we were asked to take." He added:

"The policy and political issues raised by such a precedent are indeed profound. They involve the exporting of U.S. jobs at a time of high unemployment and difficult economic conditions. Additionally, this precedent could well discourage not only those on the F-20 industrial team but also those involved in other programs from investing their own funds for achieving U.S. security objectives." 3

Despite such complaints, the Reagan White House announced on April 17, 1983 that it would allow Israel access to U.S.-made components to build the Lavi, in effect meaning Israel would depend on American technology, including engines, wings, tails and flight controls, to build a plane that, if it ever went into production, would compete directly with the U.S. aerospace industry. 4

Jones again wrote protest letters after the technology transfer, but with no more success. 5 Instead, Israel and its Washington lobby, AIPAC, the American Israel Public Affairs Committee, swung into full action to win the administration's support for not only advanced technology but for financing too. AIPAC sent memoranda on the Lavi's virtues to every member of Congress and its agents visited top legislators to argue the deal personally. 6 The aim was to convince Congress that the legislation would provide extra jobs in America and Israel and that American industry would profit from sharing by Israel of technical innovations developed during the plane's research and production.

How successful the lobby was became clear in the late spring of 1983 when Congress approved an amendment to the pending foreign aid bill allowing Israel to spend $550 million of its $2.61 billion in total aid for fiscal 1984 for the Lavi. The terms allowed Israel to spend $300 million of the Lavi money in the United States--but it also would be allowed to use an additional $250 million in Israel itself. 7

Although this amounted to the breaching of the Buy American Act by the use of U.S. aid funds outside America, there was not one committee hearing devoted to the amendment nor was there any substantial discussion of it in Congress. …

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