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(South of 9 .Mile Rd.) 248-353-5770 . 248-353-0678 Fax GLASS www.reidglass.com I srael has formally requested emergency assistance from the United States in the form of outright aid and huge loan guarantees. The goal: to bolster Israel's shrinking economy and offset some of the costs of more than two years of fierce fighting against Palestinian ter- rorists. The request was made by a visiting Israeli delegation in meetings with administration officials this week. But while the Bush administration is lis- tening, all signs point to a long, ardu- ous debate ahead — and to a signifi- cantly reduced bottom line when the dust clears. Despite the dramatic warming in U.S.-Israel relations since the 1991 loan guarantee battle, the administra- tion has sent unmistakable signals that it will use any new aid as a lever to affect Israeli policy, especially in the always-controversial area of settle- ments. And the Israeli government has already signaled back that it won't fight strings on new loan guarantees, as long as they aren't too stringent. "The level of cooperation and coor- dination between the United States and Israel is the highest in memory," said Malcolm Hoenlein, executive vice-chair of the Conference of Presidents of Major American Jewish Organizations. "But in areas where there have been concerns in the past, they are talking about some condition- ality." At the top of the list of conditions: strict accounting procedures to make sure the added U.S. dollars are not used in the Palestinian territories. Americans for Peace Now wants the administration to go further. Debra DeLee, the group's CEO, said that while the costs of fighting terrorism and Israel's economic problems justify the extra aid, "the new loan guarantees should be provided with conditions that compel Israel to finally stop set- tlement expansion." In a comprehensive proposal on aid, the group also suggested that 20 per- cent of the loan guarantee money be set aside for construction of housing for settlers who want to relocate inside Israel. There are no signs the Bush administration is ready to go that far. Still, it is inevitable there will be strings attached to any new aid, said Jess Hordes, Washington director for the Anti-Defamation League. "There's never a free lunch when it comes to foreign aid programs," he said. "The exact conditions are still very open to question. But there will defi- nitely be collateral questions of how the aid is being used." Big Numbers Even with congressional support for Israel at record levels, any new aid package will be a tough sell in a • Congress that faces a surging budget deficit, soaring defense costs and vot- ers who may see popular domestic programs slashed to the bone. ADL's Jess Hordes said, "We're in a very difficult fiscal and budgetary situ- ation; the prime obstacle won't be as much a policy issue as a budget issue. That doesn't make it any easier." Nor will the huge numbers invol- ved. Israeli sources say the overall aid request will include $4 billion in out- right military aid and $8 billion in loan guarantees aimed at helping the foundering Israeli economy. The $12 billion package would be spread over five years. • Hordes said loan guarantees have a minimal impact on the U.S. budget numbers; during the last round of guarantees in the 1990s, Israel picked up the administrative costs of the guarantees, so the net budgetary impact was very small. But the political dilemma facing lawmakers is more formidable. "In terms of perception, you're talking about very big numbers," Hordes said. With ordinary.Americans facing cuts .in popular domestic programs, even the appearance of big new foreign spending carries political risks for law- makers. Pro-Israel activists say if the admin- istration decides to bring a new Israel aid program to Congress, it will be packaged as anti-terror assistance and assistance related to the expected U.S. war against Iraq. And it will probably be part of a big regional package of assistance to U.S. allies, although