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Washington has let Jerusalem know that for now Israel should not expect any financial aid to help defray the cost of the war in Lebanon, The Jerusalem Post has learned.
According to sources in Jerusalem, the government was considering requesting US aid - one report estimated a request of $2 billion - to help pay the cost of the war. There was talk in Washington of a large-scale financial package to help rebuild southern Lebanon, and in the process keep the Iranians out of the process. Israel was apparently hoping to fold its aid request into this package.
However, according to the sources, Washington has made it clear to Jerusalem that such aid for Israel is unlikely, even as US President George Bush on Monday announced a $230 million aid package for southern Lebanon.
"Things could change," the source said, "but right now this type of request would be like spitting into the wind."
Suggestions that Israel was going to ask for $2b. come in the wake of reports last summer that Israel was going to ask for a similar amount of aid from the Bush administration to pay some of the cost of disengagement from Gaza and the resettlement of the evacuees. That number was later trimmed down to $1b., and then in July, just before the disengagement began, Finance Minister director-general Yossi Bachar went to Washington and put in a request for $500 million.
Israel, however, shelved the request indefinitely following Hurricane Katrina last August that devastated New Orleans, amid the realization that the disaster caused billions of dollars of damage and that it would not look good at that time for Israel to be asking for hundreds of millions of dollars to help house its displaced population, when the US had its own displaced population to worry about.
In a related development, Globes reported that Washington had extended the US loan guarantees by three years until 2011. Israel has still not yet used $4.6 billion of the $9 billion program, which began in 2003, and - according to the paper - extending the program will make it easier for Israel to raise financing for the war in Lebanon on international markets.