by John Spencer
Far from being a one-way transfer, U.S. military assistance to Israel delivers substantial strategic, economic and security returns to the United States.
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| Ground crew members apply an Israeli
Air Force insignia to the fuselage of an F-35I “Adir” fighter jet, one
of three newly arrived U.S.-made aircraft at Nevatim Airbase in the
Negev, on Jan. 18, 2026. Credit: IDF. |
I can’t count the number of times I’ve heard the
question: Why does the United States give Israel $3.8 billion in
military aid? Or what does the United States get in return for our $3.8
billion? If genuine, these are fair questions, and U.S. taxpayers
deserve serious answers. Foreign assistance should always be judged
through the lens of American interests.
Firstly, discussions about
aid to Israel often begin with the assumption that the United States
simply gives money away and receives little in return. That is not true
and rests on an assumption that ignores both how the aid/assistance
works and what the United States gains from one of its closest allies.
In fact, the better way to view U.S. assistance to Israel is not as a
transfer of money but as a long-term strategic investment. Then, a
better question is whether that investment produced returns for the
United States. Looking at intelligence cooperation, military innovation,
technological development, strategic access and shared security
interests, the answer is clearly yes.
Many of the benefits America
receives from Israel would continue even if the aid disappeared
tomorrow. Israel shares intelligence, develops military technologies and
confronts common adversaries because the two countries share interests,
threats and a decades-long strategic partnership. The assistance did
not purchase those benefits. It helped build and strengthen a strategic
partnership that now generates enormous value for both countries. The
relevant question is not just whether America gets something for its
investment. The question could also be whether any other recipient of
American military assistance provides as much in return.
The
United States provides military assistance through a program called
Foreign Military Financing (FMF), which allows partner nations to
purchase American-made military equipment. Egypt receives approximately
$1.3 billion annually in military aid. Jordan receives almost half a
billion. We maintain these programs because alliances are expected to
advance American interests. Yet Israel occupies a category of its own.
No other recipient of American military assistance provides the same
combination of economic, security, military, innovation and strategic
returns. If foreign military assistance is meant to serve American
interests, then there should be clear answers to what the alliance
delivers and returns on those investments.
Many of the debates
about the U.S.-Israel relationship start with a misunderstanding of
where the money goes. Under the current Memorandum of Understanding,
Israel receives approximately $3.3 billion annually in Foreign Military
Financing and another $500 million for cooperative missile-defense
programs. Almost all of the military assistance provided to Israel is
spent in the United States.
Historically, approximately 74% of
U.S. military assistance to Israel was required to be spent on
American-made defense goods and services. Under a special arrangement
known as Offshore Procurement, Israel was permitted to spend up to 26
percent of its Foreign Military Financing allocation within its own
defense industry. That exception is being phased out.
By 2028, 100
percent of FMF assistance must be spent in the United States on
American-made defense goods and services. No other major recipient of
American military assistance operates under a similar arrangement. The
money does not leave the American economy. It circulates through
American factories, American supply chains and American workers. In
practice, much of what critics describe as foreign aid flows directly to
American defense companies, American workers and the industrial base
that also equips the U.S. military.
That money directly supports
American workers and American manufacturing. Israel is the largest
international operator of the F-35 fighter aircraft, purchasing the jets
from Lockheed Martin’s production facility in Fort Worth, Texas. Each
aircraft supports a supply chain spanning more than 45 states. Israel
also purchases American helicopters, precision-guided munitions,
communications systems, radar equipment, engines and other military
technology.
The relationship extends beyond simple purchases.
Israeli firms participate in the production and development of systems
such as the F-35, with Israel Aerospace Industries manufacturing wings
for the global fleet and Israeli companies contributing technologies
used throughout the program. The result is a deeply integrated
defense-industrial partnership that benefits both countries.
Israel
is also the first nation to employ the F-35 extensively in combat.
Because the United States permits Israel to test and integrate unique
capabilities on its F-35I fleet, lessons learned from real-world combat
operations help shape tactics, software updates, electronic warfare
capabilities and future improvements to the F-35s that American pilots
have now flown in Venezuela, Iran and other theaters.
Missile
defense cooperation offers another example. The United States and Israel
jointly fund and develop systems, such as Iron Dome, David’s Sling and
Arrow. These are cooperative programs in which American companies
manufacture major components, American engineers participate in
development, and American military organizations benefit directly from
the resulting technologies and operational knowledge.
RTX
(formerly Raytheon Technologies) partners with Rafael on missile defense
technologies. Boeing manufactures major components for Arrow
interceptors. Tamir interceptors used by Iron Dome are produced at
American factories and through joint ventures. These programs sustain
manufacturing jobs and generate unique technologies that protect both
countries.
The benefits also extend beyond just production and
into capability. Some come from joint U.S.-Israeli development programs,
while others stem from Israeli innovations that the United States has
directly adopted or studied closely. The Trophy Active Protection
System, developed by Israel and proven in combat against anti-tank
missiles, has been integrated onto U.S. Army Abrams tanks and other
vehicles to help protect American crews. The United States has also
acquired Iron Dome batteries for homeland and force protection missions
while benefiting from years of operational data generated through
real-world interceptions.
American engineers and military planners
have benefited from Israeli advances in missile defense, including Iron
Dome, David’s Sling and Arrow; active protection systems; F-35
operational experience that helps inform tactics, training, and future
capability development across the broader F-35 enterprise; battlefield
medicine innovations, casualty evacuation, forward trauma care;
counter-drone technologies refined through constant operational use;
tunnel warfare adaptations studied by the U.S. Army and Marine Corps;
and artificial intelligence applications for intelligence fusion, target
recognition and battlefield decision-making. The United States gains
access not only to a technology but to years of combat experience that
would otherwise require costly testing or wartime adaptation.
The
economic relationship extends well beyond defense procurement. Trade
between the United States and Israel exceeds $50 billion annually.
American companies maintain research and development centers throughout
Israel, while Israeli firms employ thousands of workers across the
United States. Cooperation stretches from cybersecurity and artificial
intelligence to aerospace, medicine, software development, agriculture
and advanced manufacturing. Many of the technologies emerging from those
partnerships have both civilian and military applications. In an era
where technological leadership increasingly determines economic strength
and military power, those relationships matter.
National
security, however, remains the strongest argument for the partnership.
The United States maintains alliances because they reduce risk,
strengthen deterrence, expand influence, and help protect American
interests. Israel has filled that role for decades in one of the world’s
most important and unstable regions. Iran continues to expand its
missile arsenal; support proxy organizations; and challenge American
interests through a network that stretches from Lebanon and Syria to
Iraq and Yemen. Israel confronts those threats every day with its own
military, its own resources, and its own political leadership.
Former
Secretary of State Alexander Haig once described Israel as an American
aircraft carrier in the Middle East. The relationship also provides
practical military advantages that rarely enter public discussions. For
decades, the United States has maintained prepositioned military
stockpiles in Israel under the War Reserve Stockpile Ammunition-Israel
program. The equipment is intended primarily for potential American use
during regional contingencies and provides the United States with
forward-positioned supplies in a strategically important theater without
the costs associated with a large permanent military presence.
The
analogy remains useful because Israel provides many of the strategic
advantages associated with a major American military presence without
requiring the United States to deploy and sustain tens of thousands of
personnel. Israel secures itself. Israel funds the overwhelming majority
of its own defense. Israel fields one of the world’s most capable
militaries and routinely acts against threats that concern Washington as
much as Jerusalem. Few allies combine that level of capability with
that degree of self-sufficiency. Even fewer are confronting threats that
overlap so directly with American interests.
The strategic
importance of that reality extends beyond Israel itself. The Middle East
has long been an arena of great-power competition. During the Cold War,
the Soviet Union invested heavily in military partnerships, arms sales
and political influence across the region. Today, China is pursuing many
of its interests through economic rather than ideological means.
Beijing has become a major purchaser of Iranian oil, invested billions
through the Belt and Road Initiative, expanded commercial ties with Gulf
states, and sought greater influence over critical infrastructure and
trade routes. Russia has likewise worked to preserve military and
political influence through relationships with Syria, Iran, and other
regional partners.
For more than two decades, American
administrations from both parties have argued that the United States
should devote greater attention and resources to the Indo-Pacific. Yet
the Middle East remains too important to abandon. It sits at the
crossroads of Europe, Asia and Africa. Major energy producers, critical
shipping routes, emerging trade corridors and key security partners all
converge there.
A capable ally that can secure itself, deter
common adversaries, and contribute to regional stability allows the
United States greater freedom to pursue its broader strategic
priorities. Israel does not replace American power in the region, but it
helps reduce the burden on it. That matters as Washington seeks to
strengthen partnerships with India, deepen ties with Gulf states, and
compete with China globally while operating under finite military and
economic resources.
The intelligence relationship is one part of
that value. For decades, Israeli intelligence services have provided
information on terrorist organizations, Iranian military activities,
weapons proliferation networks, cyber threats and regional developments.
During the Cold War, Israel provided the United States access to
captured Soviet military equipment that improved American understanding
of its principal adversary. More recently, intelligence cooperation has
focused heavily on Iran’s missile programs, drone capabilities, proxy
networks, cyber activities and nuclear ambitions. Much of the value of
intelligence never becomes public because successful intelligence
operations often prevent events from occurring in the first place.
The
cooperation extends beyond information-sharing. Israel has spent
decades confronting many of the same organizations that have targeted
Americans, including Hezbollah, Hamas, Al-Qaeda affiliates, ISIS and
Iranian-backed militias. Israeli intelligence has contributed to efforts
that protect American personnel, diplomatic facilities and interests
overseas, while helping disrupt terrorist plots and weapons
proliferation networks before they reach American targets. Israel has
also acted against strategic threats that later became major American
concerns.
In 1981, Israeli aircraft destroyed Iraq’s Osirak
nuclear reactor. In 2007, Israel destroyed Syria’s covert nuclear
reactor before it became operational. In 2018, Israel conducted a
high-risk raid in Tehran that seized Iran’s secret nuclear archive,
providing the international community with extensive documentation of
Iran’s nuclear weapons program and preserving evidence of years of
nuclear-related research and development. For years, Israeli
intelligence and covert operations have disrupted elements of Iran’s
nuclear program and weapons procurement efforts. American policymakers
have not always agreed with every Israeli action. What is difficult to
dispute is that preventing hostile regimes from acquiring advanced
weapons capabilities has served broader American security interests.
Israel
serves as one of the world’s most active laboratories for modern
warfare. Rocket attacks, ballistic missiles, drone swarms, tunnel
networks, urban warfare, cyber operations, electronic warfare,
cross-border infiltration and information campaigns are recurring
realities rather than theoretical scenarios. Every conflict generates
operational data, battlefield lessons and technological adaptations that
are shared with American military organizations.
The United
States spends billions of dollars every year studying future warfare
through research programs, simulations, exercises and experimentation.
DARPA alone receives nearly $5 billion annually to develop breakthrough
military technologies and better understand the future battlefield.
Those investments are essential. Yet some knowledge cannot be generated
in a laboratory, replicated on a test range or fully captured in a war
game.
Combat remains the ultimate proving ground. Israel’s
military and defense industry are constantly adapting to real-world
threats and real-world adversaries. The operational data, technological
innovations and battlefield lessons that emerge from that experience
would be extraordinarily difficult, expensive, and in some cases
impossible for the United States to reproduce on its own.
Some of
that value can be measured in technologies adopted by American forces,
intelligence shared between allies and joint defense programs that
benefit both countries. Much of it cannot. The experience gained from
repeated combat against modern threats is, in many respects,
irreplaceable. The United States benefits from those lessons without
having to learn them first through American casualties, American
mistakes or American wars.
The value of that exchange is not
theoretical. For years, the U.S. military has actively studied Israeli
combat experience to improve American readiness. American officers have
examined Israeli adaptations in urban warfare, tunnel operations,
counter-drone technologies, force protection measures, military working
dog employment, intelligence integration and battlefield medicine.
The
relationship extends beyond reports and briefings. American military
units have regularly trained alongside Israeli forces and visited
Israeli training centers to observe tactics, technologies and lessons
developed through combat experience. Many of those lessons emerged from
combat against adversaries employing tactics that American forces faced
in past wars and are increasingly likely to encounter in future
conflicts. The result is that Israeli battlefield experience often
becomes American military knowledge without the United States having to
pay for those lessons in blood.
Similar examples can be found
across missile defense, counter-drone technologies, intelligence fusion
systems, tunnel warfare capabilities, battlefield medicine and
artificial intelligence-enabled decision support tools developed under
operational conditions.
Missile defense provides perhaps the
clearest example. Iron Dome, David’s Sling and Arrow were not developed
through laboratory testing alone. They evolved through repeated combat
use against real threats. Thousands of interceptions have produced an
enormous body of operational knowledge about air defense, command and
control, target discrimination, radar integration and emerging missile
technologies. American companies participate directly in these programs.
American engineers contribute to them. American military organizations
study the data they produce.
Thousands of real-world
interceptions have generated operational knowledge that no test range
can fully replicate. The cooperation extends beyond research and
analysis. The U.S. Marine Corps has selected the Tamir interceptor,
originally developed for Iron Dome, as part of its Medium Range
Intercept Capability (MRIC) air-defense system. The United States would
spend many times more than $3.8 billion attempting to independently
develop, test and combat-validate the technologies, concepts and
operational lessons generated through decades of U.S.-Israeli
cooperation.
Perhaps the most overlooked benefit is Israel’s
defense innovation ecosystem. Today, more than 300 Israeli defense
technology companies operate in fields including artificial
intelligence, autonomous systems, cybersecurity, robotics, electronic
warfare, missile defense, sensors and counter-drone technologies. That
number has nearly doubled since Oct. 7.
For a country of roughly
10 million people, the scale is remarkable. Many of these firms were
founded by veterans of elite military and intelligence units who are
solving problems they encountered during service. The distance between
battlefield operators and technology developers is unusually short. In
many cases, the people designing the technology are the same people who
recently used it in combat. New threats emerge, solutions are developed
and capabilities move into operational use with a speed that would be
difficult for most governments to replicate.
American companies
partner with Israeli firms because they recognize the value of that
innovation cycle. American military organizations gain access to
technologies, expertise and operational insights that would be
expensive, time-consuming, and often impossible to reproduce on their
own.
Artificial intelligence is becoming increasingly important
within that ecosystem. Israeli companies and military organizations are
integrating AI into missile defense, sensor fusion, target recognition,
intelligence analysis, autonomous systems and active protection
technologies. Future wars will be shaped by the ability to process
information faster than an adversary and convert that information into
action. Israel’s experience operating those systems under real-world
conditions provides lessons that help prepare American forces for the
conflicts ahead.
The value of the relationship becomes even
clearer when compared with other recipients of American military
assistance. Egypt contributes to regional stability and maintains peace
with Israel. Jordan remains an important security partner and
counterterrorism ally. Both relationships advance legitimate American
interests. Neither generates the same intelligence cooperation, defense
technology innovation, industrial integration or battlefield lessons
that flow from the U.S.-Israel partnership.
The United States
does not gain access to hundreds of defense technology startups through
Egypt. It does not field combat-proven active protection systems
developed through Jordan. It does not receive the same volume of
battlefield lessons on missile defense, drones, tunnels, artificial
intelligence and urban warfare from either country. Israel’s value
derives not only from its location but from the capabilities it
continually produces.
There is also a political dimension to the
alliance. The United States and Israel are democracies. Neither is
perfect. Both experience fierce political disagreements, contentious
elections and intense public debate. Both operate under the rule of law
and maintain independent institutions. Shared values alone do not
determine foreign policy, but alliances tend to endure when interests
and political traditions reinforce one another. That reality has helped
sustain the relationship across administrations of both parties.
Reasonable
people can debate aid levels. They can debate specific policies pursued
by either government. They can argue about how the relationship should
evolve over time. Those are legitimate discussions. What is far more
difficult to sustain is the argument that America receives little in
return. The United States gains access to intelligence that helps
prevent attacks against Americans and American interests. It gains
military technologies refined through combat experience. It gains
battlefield lessons that would otherwise cost billions to acquire
independently. It gains access to one of the most dynamic defense
innovation ecosystems on the planet. It gains a capable ally operating
in a strategically important region against many of the same adversaries
confronting the United States.
The future of the relationship may
itself demonstrate the success of the investment. In recent interviews,
Israeli Prime Minister Benjamin Netanyahu has suggested that Israel
should gradually reduce its reliance on American military financing as
its economy and defense industry continue to expand. He has spoken about
eventually transitioning from traditional assistance toward deeper
cooperation in areas such as cyber capabilities, artificial
intelligence, missile defense, directed energy and other emerging
technologies.
Whether that transition occurs in the next
Memorandum of Understanding or further in the future remains uncertain.
Israel continues to face significant security threats and remains
engaged in multiple conflicts. The broader point is that the
relationship has evolved. American assistance helped support Israel
during periods when its economy was smaller, its defense industry less
developed, and its security challenges no less severe. Today, Israel
possesses one of the world’s most advanced defense sectors, a thriving
technology economy, and military capabilities that generate value not
only for its own security but for the United States as well.
If
future agreements place less emphasis on direct financing and greater
emphasis on joint research, co-development and technological
collaboration, that would not signal a weakening partnership. It would
reflect a mature partnership built on decades of successful investment.
American assistance helped Israel build capabilities that now generate
value for both countries. If Israel eventually requires less direct
assistance while contributing more technology, innovation, intelligence
and operational expertise, that would not represent the failure of the
partnership. It would represent one measure of its success.
So the next time someone asks what the United States gets for $3.8 billion in Israel, the answer is straightforward:
• Jobs: American jobs and manufacturing supported through purchases of U.S.-made military equipment.
• Industry: A stronger U.S. defense industrial base through joint production, co-development and missile-defense cooperation.
• Intelligence: Intelligence that helps prevent attacks against Americans, American forces and American interests.
• Technology:
Military technologies refined in combat, from active protection systems
and missile defense to counter-drone capabilities and artificial
intelligence.
• Laboratory: Access to one of the world’s most
active laboratories for modern warfare, generating operational data,
experimentation, innovation and combat experience that would be
difficult, expensive and in some cases impossible to reproduce
independently.
• Lessons: Battlefield lessons in urban
warfare, tunnel warfare, missile defense, drones and modern combat
without having to learn them first through American casualties, American
mistakes or American wars.
• Innovation: A defense innovation ecosystem producing technologies and ideas that benefit both countries.
• Ally:
A capable ally helping deter common adversaries and maintain stability
in one of the world’s most strategically important regions and, if
necessary, willing and able to fight alongside the United States.
• Strategy:
Greater freedom for the United States to focus military and economic
resources on long-term competition with China in the Indo-Pacific while
helping preserve a favorable balance of power in the Middle East.
That is what America gets in return.
John Spencer is chair of urban warfare studies at the Modern War Institute (MWI) at
West Point, co-director of MWI’s Urban Warfare Project and host of the
“Urban Warfare Project Podcast.” He served for 25 years as an infantry
soldier, which included two combat tours in Iraq. He is the author of
the book Connected Soldiers: Life, Leadership and Social Connection in Modern War and co-author of Understanding Urban Warfare. See his Substack.
Source: https://www.jns.org/opinion/john-spencer/what-does-america-get-for-3-8-billion-in-israel
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