US Aid to Israel: Trump's Plan to End $4 Billion Annual Funding

U.S. President Donald Trump announced on November 3rd a plan to cease annual military aid to Israel, totaling $4 billion, by the end of 2026. This move, agreed upon with Prime Minister Benjamin Netanyahu, would end a long-standing practice that has made Israel the largest recipient of American aid since World War II. The current memorandum on military support is valid until 2028.

U.S. financial support for Israel began in 1949 with a $100 million loan. Initially, aid was primarily economic, with France serving as the main arms supplier until the late 1960s. Washington gradually took over, supplying Hawk missiles in 1962 and Phantom fighter jets in 1968. Significant U.S. grants commenced in 1971, and following the 1973 Yom Kippur War, President Richard Nixon secured $2.2 billion in emergency aid, including $1.5 billion in military grants.

The 1979 peace treaty with Egypt involved $7.5 billion in U.S. aid, with Israel receiving the larger portion. In the 1990s, as Israel's technology sector grew, Prime Minister Benjamin Netanyahu announced a reduction in economic aid. Starting in 1999, economic aid decreased annually by $120 million, while military funding increased by $60 million, with economic grants fully ending in 2008.

Since then, U.S. aid has focused on defense, governed by decade-long memorandums. The first (1999-2008) allocated at least $26.7 billion, followed by one agreed by the George Bush administration (2009-2018) for $30 billion, which allowed some funds for domestic procurement. The current memorandum, signed under the Obama administration for 2019-2028, provides $38 billion ($33 billion for military needs, $5 billion for missile defense) and increasingly restricts domestic procurement in favor of U.S. products, causing discontent among local defense industries.

Separate U.S. funding supports Israeli missile defense systems. Over $6 billion has been allocated since 2011 for the Iron Dome, as well as for the development and maintenance of Arrow and David's Sling systems. Following the October 7, 2023, Hamas attack, the Joe Biden administration provided additional aid, increasing the initial package from approximately $14 billion to $17.6 billion. In fiscal year 2024 alone, Israel received $12.5 billion, more than triple the previous year.

According to the Congressional Research Service, the U.S. has provided Israel approximately $175 billion in aid from 1946 to 2025, including military grants, economic financing, and missile defense funds. Adjusted for inflation, this figure is estimated at $298 billion by the State Department and around $330 billion by the CFR. Earlier reports indicated that the U.S. midterm election results could influence Washington's future policies, including those concerning Israel.