The war between Israel and the United States against Iran is based on a strategic architecture developed over the decades. As Iranian drone strikes once again tested the ceasefire in the Persian Gulf this Sunday, and Prime Minister Benjamin Netanyahu stated to CBS News his intention to reduce American financial aid to zero over a decade, a question arises: Is this aid still essential for the survival of the Israeli state?
Seven decades of unconditional support
Israel is the largest recipient of American foreign aid. According to the Congressional Research Service (CRS), Washington has provided $174 billion in current dollars in bilateral assistance and missile defense funding since 1948 – roughly $298 billion in 2024 constant dollars. This support has spanned every administration, Republican and Democrat, and has been institutionalized through decade-long memorandums of understanding, which are non-binding political commitments directly negotiated between the two governments without parliamentary ratification, establishing guaranteed military aid levels and major defense cooperation priorities.
The first memorandum, signed under Clinton in 1999, amounted to $26.7 billion over ten years. The second, under George W. Bush in 2007, was for $30 billion. The third, in effect from 2019 to 2028 and agreed upon in 2016 under Obama, commits the United States to $38 billion: $33 billion in direct military funding and $5 billion for joint missile defense programs. These are augmented by significant emergency credits since October 7, 2023 – $12.5 billion for the year 2024 alone, according to the CRS.
This aid has enabled the Israeli military to possess the world’s densest multilayered shield: Iron Dome, David’s Sling, Arrow II, Arrow III, and the latest addition, the Iron Beam laser. It has also funded the acquisition of F-35s, making Israel the largest global operator outside the US, as well as CH-53K helicopters and future KC-46A tankers. Before the Gaza War, American aid represented around 20% of Israel’s defense budget, according to the Council on Foreign Relations (CFR).
A relationship being reshaped
This model is currently being questioned from both sides of the Atlantic. Negotiations are set to begin in May for the next memorandum, aiming to gradually shift from direct aid to a common industrial and technological partnership – defense lasers, artificial intelligence, hypersonic systems, and quantum computing, as reported by the Jerusalem Post.
This shift is caused by several converging factors. In the US, the bipartisan support for aid is waning, with 40 of 47 Democratic senators recently voting to block arms sales to Israel. A growing faction of the Republican camp, influenced by the “America First” ideology, is also questioning foreign aid.
The Carnegie Endowment notes that the significant destruction in Gaza has created lasting fractures within the American pro-Israeli community. Thus, a growing segment of the American public views military aid as a form of shared responsibility for Israel’s actions.
From the Israeli perspective, the conflict revealed a strategic vulnerability: during the Rafah operation in 2024, Israel curtailed its offensive due to concerns about running out of American ammunition. Netanyahu publicly acknowledged this episode and announced an industrial independence plan named “blue and white” – after the Israeli flag – to domestically produce an increasing portion of ammunition and military technology.
Could Israel survive without this aid?
The answer is nuanced. From a macroeconomic standpoint, the INSS observes that American aid’s share of Israel’s GDP dropped to around 0.5% in 2025, highlighting Israel’s exceptional economic growth since 2016. Israel ranks among the top fourteen wealthiest countries per capita, and its defense industry – Elbit Systems, Rafael, Israel Aerospace Industries – exports nearly 70% of its production globally, yielding significant revenues.
However, aid still constitutes approximately 15% of the defense budget, according to the INSS, and replacing it entirely would be costly in a post-war rearmament context. More crucially, it’s not just about finances – it’s about guaranteed access to cutting-edge American military technologies. Israel doesn’t produce its own fighter jets and relies entirely on Washington for F-35s. Maintaining its regional aerial superiority would be challenging if a future US government refuses to sell F-35s, as noted by the Jerusalem Post.
Furthermore, aid serves as an institutional and symbolic anchor of the alliance, preventing diplomatic U-turns between successive administrations. Its abrupt disappearance without a replacement agreement would send a devastating signal to Israel’s adversaries, summarized by the CFR as signaling that its closest ally is retracting support.
Thus, the ongoing transition is not a rupture but a transformation: from a relationship of dependence towards an industrial and technological partnership between two military powers that together have reshaped deterrence rules in the Middle East.
