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Obama and Netanyahu, meanwhile, appear to have reached an impasse after two and a half years of rocky relations. The Obama White House was angered when Netanyahu refused a U.S. demand to halt building Jewish settlements in the West Bank.

The brewing crisis in U.S.-Israeli relations dimmed even further the prospect for resuming peace talks that collapsed late last year when Palestinians walked away in a dispute over Israeli settlement building in the West Bank.

The Democratic president has quickly come under fire from Republican critics, who accuse him of betraying Israel, the closest U.S. ally in the region. Pushing Netanyahu could alienate U.S. supporters of Israel as Obama seeks re-election.

He explored the strategic reasoning behind the aid, asserting that it parallels the "needs of American arms exporters" and the role "Israel could play in advancing U.S. strategic interests in the region."

Approximately a third of the entire U.S. foreign aid budget goes to Israel, "even though Israel comprises just...one-thousandth of the world's total population, and already has one of the world's higher per capita incomes."

The economy would have collapsed in 1973 due to the balance of payments problem following the Yom Kippur War. Today it is still important to shoulder the economy from external shocks such as the Persian Gulf War and the massive flow of Russian immigrants to Israel in the past few years. If the aid were reduced or eliminated, a sharp reduction in government spending would be required. Sussman adds: "The $1.5 billion in emergency aid allocated to Israel in the mid-1980s was responsible for helping to stabilize the Israeli economy and stifle hyperinflation."6

In fact, American defense and aerospace firms reap substantial benefits from U.S. aid to Israel, for it guarantees them a $1.35 billion captive market each year. Out of $1.8 billion in grants, then, Israel receives about $450 million in cash that can be converted into Israeli currency and used either to purchase Israeli-made military products or develop weapons (such as the Arrow anti-missile system). Steven L. Spiegel, a professor at the University of California in Los Angeles, points out that Israel performs invaluable services by testing and developing weapon systems for the United States, improving American-made equipment, and providing crucial intelligence information.11 Moreover, Spiegel argues that Israel's use of American-made arms not only saves the United States money but earns it more: For example, after Israel's much advertised successes with U.S. weaponry in the 1969-70 War of Attrition and the 1982 war in Lebanon, U.S. arms sales worldwide in 1972-82 nearly tripled, from about $6.8 to $19.6 billion in constant 1982 dollars.12 And while of course it does not wish for wars to occur, the United States gains valuable information by seeing its arms perform against those of Israel's enemies, lessons that "cannot be purchased, developed, or simulated."13

Mr. Obama declared that the prevailing borders before the 1967 Arab-Israeli war — adjusted to some degree to account for Israeli settlements in the West Bank — should be the basis of a deal. While the 1967 borders have long been viewed as the foundation for a peace agreement, Mr. Obama’s formula of land swaps to compensate for disputed territory created a new benchmark for a diplomatic solution.

the country’s 1967 borders are not militarily defensible. But his use of this argum

Israel needs peace with the Palestinians, and that will likely require a return to the 1967 lines with a few adjustments. These borders can be made defensible if they come with a security package consisting of a joint Israeli-Palestinian security force along the West Bank’s border with Jordan, a demilitarized Palestinian state and a three-way Israeli-Jordanian-Palestinian defense treaty. Combined with such a package, the balanced formula President Obama outlined in his May 19 speech can give Israel the security it needs and deserves.

This rocket created a new reality in which nearly one million Israeli residents [about 15 percent of the entire population] were at risk.

The IDF has noted that militants commonly hide a Qassam in a commercial truck, drive to a clearing near the Gaza border and launch the rocket. One Hamas website states that this takes only 15 minutes.

maximum range of those rockets is up to 40 km.

] is a real benefit to the United States and Israel. We give aid to Israel to maintain its security in a very tough region and a very important part of the world in order to advance critical U.S. interests. If that aid were reduced to a point that Israel couldn't buy the equipment it needs to defend itself and maintain the peace, that would be dangerous to us."

"As Israel is continually attacked by ongoing Palestinian terrorist assaults, aid to Israel is more important than ever. Foreign aid presents many benefits to Israel’s safety and security and to Middle East stability.

Israeli research and development of weapons systems is often co-financed by the US. Joint military projects have been set up, such as the development of the Arrow Missile System, which has been operational since 2000.

In August 2007, a new Memorandum of Understanding (MOU) on military aid was signed between Israel and the US. This MOU guarantees Israel $30 billion in military aid via FMF over the next decade.

Finally, in the context of a discussion over classic conventional war, there is one further consequence to consider from a full Israeli withdrawal to the 1967 lines: after such a withdrawal the chances of war would actually increase, as Israel's ability to deter war would be eroded. A post-withdrawal Israel would offer a very tempting target, since it would be a narrow country with no strategic depth whose main population centers and strategic infrastructure would be within tactical range of forces deployed along the commanding heights of the West Bank. Whoever believes that war is impossible does not have to take this consideration into account; but all who think that it is possible, even if unlikely right now, must then understand that by returning to the 1967 lines, Israel increases the chances that such a scenario of renewed hostilities may actually materialize.

lus all of the Gaza Strip, when the Palestinian Authority regains control over the Gaza Strip, which the militant group Hamas seized from forces loyal to Abbas in June 2006.

The Israeli proposal is not acceptable," Abbas's spokesman said. "The Palestinian side will only accept a Palestinian state with territorial continu

Sen. Orrin Hatch (R-Utah) issued a press release today stating his intention to introduce a resolution next week disapproving of the policy concerning Israel that President Barack Obama announced on Thursday.

Israel and the United States share the view that the United States has a predominant role

nd the Israeli government. Currently, in Washington, D.C., President Bush is promising aid to the Palestinians, ai

aid that they desperately need, in order for them to be able to establish good, peacekeeping forces that can rein in terrorists and serve as a police force in the region that Israel is trying to move out of.

Israel needs America’s help now more than ever.