Israel: Background and Relations with the United States
Publication Date: May 2006
Publisher: Library of Congress. Congressional Research Service
Author(s):
Research Area: Government
Type:
Coverage: Israel
Abstract:
On May 14, 1948, the State of Israel declared its independence and was immediately engaged in a war with all of its neighbors. Armed conflict has marked every decade of Israel's existence. Despite its unstable regional environment, Israel has developed a vibrant parliamentary democracy, albeit with relatively fragile governments.
Prime Minister Ariel Sharon formed a three-party coalition in January 2005 to secure support for withdrawing from the Gaza Strip and four small settlements in the West Bank. In November, however, new Labor party leader Amir Peretz withdrew his party from the government and called for early elections. Sharon then resigned from the Likud party to form a new party, Kadima. On January 4, 2006, Sharon suffered an incapacitating stroke; Deputy Prime Minister Ehud Olmert succeeded Sharon. Kadima placed first in the March 28, 2006, Knesset (parliament) election, and Olmert has formed a four-party coalition government.
Israel has an advanced industrial, market economy in which the government plays a substantial role. The economy is now doing very well, and increased social spending is expected.
Israel's foreign policy is focused largely on its region, Europe, and the United States. The government views Iran as an existential threat due to its nuclear ambitions and support for anti-Israel terrorists. Israel negotiated a series of agreements with the Palestinians in the 1990s, but the Oslo peace process ended in 2000, after the beginning of the intifadah or uprising against Israeli occupation. Israeli and Palestinian officials resumed contacts after the November 2004 death of Yasir Arafat. Both sides accepted but have not implemented the "Roadmap," the international framework for achieving a two-state solution. Israel unilaterally disengaged from Gaza in summer 2005 and is constructing a security barrier to separate from the Palestinians. The victory of the Hamas terrorist group in the January 2006 Palestinian parliamentary elections has complicated Israeli-Palestinian relations and led Israeli officials to consider unilateral steps in the West Bank. Israel concluded a peace treaty with Egypt in 1979 and with Jordan in 1994, but never reached accords with Syria and Lebanon. It unilaterally withdrew from southern Lebanon in 2000. European countries collectively are Israel's second largest trading partner, and the EU participates in the peace process.
Since 1948, the United States and Israel have developed a close friendship based on common democratic values, religious affinities, and security interests. U.S.-Israeli bilateral relations are multidimensional. The United States is the principal proponent of the Arab-Israeli peace process, but U.S. and Israeli views differ on various peace process issues, such as the fate of the Golan Heights, Jerusalem, and Israeli settlements. The United States and Israel concluded a free-trade agreement in 1985, and the United States is Israel's largest trading partner. Since 1976, Israel has been the largest recipient of U.S. foreign aid. The two countries also have very close security relations.
Current issues in U.S.-Israeli relations include Israel's military sales to China, inadequate Israeli protection of U.S. intellectual property, and espionage-related cases.
See also CRS Issue Brief IB91137, The Middle East Peace Talks and CRS Report RL33222, U.S. Foreign Aid to Israel.