Unwanted Foreign Funding

Adapted from an article in Besheva magazine by Nitzan Kedar, journalist and author, translated by Hillel Fendel.

A Congressional inquiry is underway into U.S. financial intervention in Israel's affairs and attempts to sway it leftwards. Both the U.S. and Israel Tell Sources, "Mind Your Own Business!"

During the seemingly long-ago era before the infamous October 7^th and the ensuing war in Gaza, one of the issues that the Israeli nationalist camp was focused on was that of foreign funding for the left-wing anti-judicial reform protests. Some claimed that various foreign entities were involved in fueling the anti-government unrest, while many dismissed these claims as fake news.

It now turns out that the smoke in this case seems to have signaled a bona-fide fire – and the U.S. Congress is taking action. Various steps are being taken in both Israel and the United States both to prove that this funding happened - directed against the sitting Israeli government and against objectives that Israel seeks to advance - and also to cut off significant portions of it.

American Money for Intervention in Israel

In recent months, with relatively sparse media coverage, a Congressional investigation into these monies has been underway, spearheaded by Representatives Jim Jordan and Brian Mast. As of now, the relevant committee (actually, two committees working as one) has revealed that the Biden Administration provided grant funds to groups that contributed, directly and indirectly, to the widespread protests in the year before the war, and at other times, that sought to undermine the Israeli government. In addition, according to the committee, documents obtained during this investigation suggest that the Biden-Harris Administration funded groups with ties to U.S.-designated terrorist organizations.

In March of this year, the Congressional committee sent letters to six U.S. and Israeli non-governmental organizations (NGOs) to request documents related to any grants, cooperative agreements, or other awards received from the U.S. Agency for International Development (USAID) or the State Department. The NGOs are: Blue White Future, Movement for Quality Government in Israel, Middle East Peace Dialogue Network, Rockefeller Philanthropy Advisors, PEF Israel Endowment Funds, and Jewish Communal Fund.

Almost all of them are associated with left-wing, liberal, and/or progressive causes, such as the two-state solution and opposition to the Netanyahu government, although the last two are merely "donor-advised" conduits for various causes, including many associated with the left-wing camp.

As many members of Congress allege, U.S. government funding of these groups is most certainly an acute case of official meddling in internal Israeli affairs. The legislators are greatly concerned, mainly because, as they say, American taxpayers want to see their money being used for their own affairs and not those of other countries.

The committee sent letters last month to some of the above NGO's, alleging that Blue White Future received some $18 million from the PEF Israel Endowment Funds as well as approximately $4 million from the Middle East Peace Dialogue Network. The Congressmen maintain that though the organization denied receiving direct funding from the U.S. government, it did not provide documents proving the nature of the funding from third-party funds.

The Jordan-Mast Congressional committee also demanded that The Abraham Initiatives – a Jewish/Arab Israeli organization that says it seeks to "guarantee and protect the full citizenship and equal rights of its Palestinian citizens," and wants Israel to "exist peacefully alongside an independent, sovereign Palestinian state" – reveal information on grants it received from the Administration, including $375,000 from the State Department in 2021.  The Abraham Initiatives was also asked to detail its connections with Blue White Future, the New Israel Fund, and others. Tides Network, another left-leaning donor-advised fund, was similarly asked to explain a $25 million grant it received from USAID.

Jordan and Mast spelled out their accusations clearly: The Biden Administration gave money with the purpose of "trying to undermine the democratic government of Israel." They noted that "the use of federal grants in this way not only endangers the relationship between the United States and one of its closest allies, but also undermines basic civil liberties." This could even constitute a criminal offense, they said, and requested the organizations’ cooperation for an official investigation.

A main player in the investigation is USAID – a U.S. government body alleged to have transferred millions of dollars to organizations connected with terrorist orgs and anti-Semitic groups. This is largely why the Trump Administration recently took significant actions to dismantle it, effectively halting its operations. On his first day in office, President Trump signed an executive order freezing nearly all U.S. foreign aid for a 90-day review, and it was announced soon afterwards that the lion's share of USAID’s global staff would be placed on administrative leave or terminated.

A Legislative Bill in Israel

Similar efforts to stop foreign intervention in Israel are being taken in Israel itself. Likud MK Ariel Kalner is sponsoring a bill to levy an 80% tax on donations from foreign countries to Israeli associations and organizations. The law would also forbid Israeli courts from hearing suits brought by associations funded mostly by foreign countries. (Both of these rules will not apply if the funded org is also supported by Israel.) The Finance Minister and Knesset Finance Committee, according to the proposed bill, will have the joint right to exempt the 80% tax if "special" conditions apply.

MK Kalner explained: "The bill is intended to completely dismantle organizations that violate laws, such as the law against BDE, or that call for disobedience to IDF orders… But we have no issue with [countries] that fund organizations dealing with their culture or aid to Holocaust survivors. It's organizations that file petitions in courts, create protests, or lobby for political causes that are problematic. Therefore, any organization receiving foreign funding will have to declare that it is not using that money for anti-Israel activities."

Kalner says the problem has long been very extensive: "Since 2012, more than a billion shekels have been funneled to associations that advanced political agendas in Israel, creating the idea of 'settler violence,' calling for sanctions against residents of Judea and Samaria, and promoting the two-state solution. Even the campaign that seeks to emphasize supposed 'religious coercion' in Israeli society was funded, according to our understanding, by the German government."

Incredibly, Kalner notes, "Israel's Supreme Court has been flooded with some 1,000 petitions over the past eight years on these types of issues. It is mind-boggling that these organizations continue to function here with foreign funding, especially, as we recently saw, regarding the protests against the judicial reform and, consequently, against the duly-elected government of Israel. This is why this bill is genuinely part of our ongoing struggle for independence; it seeks to preserve the sovereignty of the State of Israel."

Asked whether the Biden Administration had attempted to block the bill from being passed, Kalner answered in the affirmative: "This happened when I first raised it, in May 2023. The Americans, together with European countries, pressured strongly against it. This is why I raised it against immediately after Trump took office this year, with the understanding that in the U.S. they also are trying to counter this trend."

"The associations are also very much against this bill," Kalner said. "This is a problem that not only we are suffering from; I heard from officials in Hungary and Slovakia that foreign countries are trying to meddle in their internal affairs as well."

With both the U.S. and Israel working to stop the worrisome trend of foreign intervention in other countries' affairs, transparency regarding the issue is on the rise. The more we see associations of a particular political bent opposing Kalner's bill, the sharper is our realization that dealing with this problem is both important and inevitable.