By Dr. Jonathan Kenigson, FRSA
JERUSALEM, Israel, March 7, 2026 – The financial relationship between the United States and Israel has long been described in the language of strategic partnership. Yet when the relationship is examined through the lens of fiscal accounting rather than diplomatic rhetoric, the balance sheet increasingly resembles a unilateral subsidy. Since Israel’s founding in 1948, the United States has transferred roughly 317 billion dollars in total economic and military assistance when adjusted for inflation, making Israel the largest cumulative recipient of U.S. foreign aid since the end of World War II [1]. Congressional Research Service analysis places the total at more than 174 billion dollars in direct bilateral assistance measured in contemporary dollars alone [2]. These figures exceed the cumulative aid received by any other country in modern American foreign policy and illustrate the extraordinary fiscal scale of the U.S.–Israel alliance. How do these expenditures benefit me, the American taxpayer living paycheck to paycheck, fighting wars that are not mine?
During the early decades of the relationship, American support for Israel included economic development programs, loan guarantees, and agricultural assistance. Beginning in the late Cold War period, however, the structure of this assistance shifted almost entirely toward military financing. Under the ten-year memorandum of understanding signed in 2016, the United States committed 38 billion dollars in military assistance between 2019 and 2028, equivalent to approximately 3.8 billion dollars annually [3]. Roughly 500 million dollars of this funding each year supports joint missile-defense systems including Iron Dome, David’s Sling, and the Arrow interceptor network [4]. These appropriations finance interceptor production, radar systems, and research programs forming the backbone of Israel’s multilayered air-defense architecture.
American taxpayers therefore play a direct role in sustaining Israel’s most advanced defensive technologies. While the systems themselves are operated by Israel, the underlying research, production, and replenishment cycles rely heavily on congressional appropriations within the United States defense budget. This financial structure effectively integrates Israeli defense procurement into American defense spending priorities. Periods of conflict dramatically expand these expenditures. Following the outbreak of war between Israel and Hamas in October 2023, the United States approved approximately 16.3 billion dollars in emergency security assistance through supplemental congressional legislation [5]. When additional weapons transfers, replenishment appropriations, and related regional operations are included, researchers estimate that U.S. expenditures tied to Israel’s military operations exceeded 22.7 billion dollars during the first year of the conflict alone [6]. The logistical scale of the American resupply effort was unprecedented. By mid-2025 the United States had delivered roughly ninety thousand tons of military equipment through more than eight hundred aircraft and approximately one hundred forty cargo ships [7]. These shipments included artillery shells, precision-guided bombs, armored vehicle components, missile interceptors, and a wide range of logistical supplies required to sustain large-scale combat operations.
The financial burden associated with Israel’s security environment extends beyond direct aid transfers. The United States maintains a permanent military posture across the Middle East in order to deter Iran and Iranian-aligned forces that threaten Israel and other regional partners. The centerpiece of this posture is the aircraft carrier strike group. Operating a single strike group costs roughly nine million dollars per day once aviation operations, escort vessels, and logistics are included [8]. Nuclear-powered aircraft carriers themselves cost approximately thirteen billion dollars to construct and millions of dollars per day to operate [9]. A typical deployment lasting six months therefore represents several billion dollars in operational expenditures alone. These deployments have become routine features of American strategy in the region. During periods of heightened confrontation with Iran following the escalation of conflict in 2023, American troop levels in the Middle East increased from roughly 34,000 personnel to as many as 50,000 [10]. These forces include fighter aircraft squadrons, missile-defense batteries, naval destroyers, intelligence surveillance systems, and extensive logistical infrastructure. Maintaining such a force posture requires constant fuel shipments, aerial refueling missions, equipment maintenance, satellite surveillance, and personnel rotation cycles.
Historical precedents demonstrate that the financial consequences of Middle Eastern conflict can escalate rapidly. During the 1973 Yom Kippur War, the United States conducted a massive emergency airlift to resupply Israeli forces with tanks, artillery, and ammunition. Operation Nickel Grass ultimately delivered more than 22,000 tons of military equipment to Israel within a matter of weeks [11]. The operation represented one of the largest strategic airlifts in American military history and required substantial emergency expenditures by the United States government. Later confrontations with Iran added additional layers of cost. During the late 1980s “Tanker War” phase of the Iran–Iraq conflict, the United States Navy launched Operation Earnest Will to protect oil tankers moving through the Persian Gulf. The operation required the deployment of dozens of naval vessels and ultimately involved direct combat between U.S. and Iranian forces during Operation Praying Mantis in 1988 [12]. Although the operation successfully secured shipping lanes, it also required sustained naval deployments and significant operational expenditures.
Modern conflicts with Iran threaten to impose even greater financial burdens. Analysts estimate that sustained combat operations against Iran could cost roughly one billion dollars per day when naval patrols, air operations, missile launches, and logistical support are included [13]. Economic modeling suggests that a prolonged war could ultimately cost between 40 billion and 100 billion dollars in direct federal spending alone [14]. These estimates exclude secondary economic effects such as disruptions to global oil markets or increased shipping insurance costs. The hardware costs of modern warfare illustrate how rapidly such totals accumulate. U.S. forces frequently rely on Tomahawk cruise missiles during long-range strike operations; each missile costs roughly two million dollars [15]. Long-range stealth bombers such as the B-2 Spirit cost more than two billion dollars each to procure and deploy bunker-buster weapons costing millions of dollars per unit [16]. A single strike mission can therefore involve hundreds of millions of dollars in equipment and munitions.
Defensive operations can prove even more expensive than offensive ones. Iranian military doctrine relies heavily on large numbers of inexpensive drones and missiles designed to overwhelm defensive systems through sheer volume. Iranian Shahed-type drones are estimated to cost roughly thirty-five thousand dollars each to produce [17]. Intercepting those drones requires missile-defense systems such as Patriot or THAAD interceptors costing millions of dollars per missile. THAAD interceptors alone cost between eight and twelve million dollars each [18]. During large missile barrages analysts estimate that the United States and its allies have spent more than ten billion dollars on interceptor missiles within only a few days of combat [19]. This cost asymmetry became particularly visible during the large Iranian missile and drone attack against Israel in April 2024. Iran reportedly spent between 80 million and 100 million dollars launching the attack, while the defensive response by Israel, the United States, and allied forces cost roughly one billion dollars [20]. The defending coalition therefore spent roughly ten times more money intercepting the attack than Iran spent launching it.
Additional costs arise from conflicts involving Iranian-aligned groups across the region. U.S. naval and air forces have conducted extensive operations against Houthi forces in Yemen in response to attacks on international shipping connected to Israel’s war in Gaza. During this campaign Houthi air defenses destroyed several MQ-9 Reaper drones valued at more than 30 million dollars each [21]. The destruction of just seven such aircraft represents more than 200 million dollars in lost equipment before operational costs are considered. American taxpayers finance billions of dollars in direct military assistance to Israel each year, fund major components of Israeli missile defense infrastructure, replenish Israeli weapons stockpiles during wartime, maintain naval and air deployments throughout the Middle East, intercept missile attacks directed toward Israel, and conduct combat operations against Iranian forces and Iranian-aligned militias. Aircraft costing tens of millions of dollars, interceptor inventories costing billions, and carrier strike groups costing millions per day all represent expenditures recorded on the U.S. federal ledger.
Over decades, the cumulative cost of this strategic posture reaches into the hundreds of billions of dollars. Examined purely in fiscal terms, the geopolitical environment surrounding Israel has produced a persistent and substantial stream of expenditures borne overwhelmingly by the American taxpayer. When viewed through the lens of fiscal reciprocity rather than diplomatic rhetoric, the balance sheet of the alliance raises a central policy question: whether a strategic partnership can remain sustainable indefinitely when one partner consistently bears the overwhelming share of the costs required to maintain the regional security environment.
References
[1] USAFacts. (n.d.). How much military aid does the U.S. give to Israel? https://usafacts.org/articles/how-much-military-aid-does-the-us-give-to-israel/
[2] Congressional Research Service. (2023). U.S.–Israel relations (CRS Report RL33222). https://sgp.fas.org/crs/mideast/RL33222.pdf
[3] U.S. Department of State. (n.d.). U.S. security cooperation with Israel. https://www.state.gov/u-s-security-cooperation-with-israel/
[4] Center for Strategic and International Studies. (n.d.). Missile threat: Israel missile defense systems. https://missilethreat.csis.org/country/israel/
[5] United States Congress. (2024). Supplemental appropriations for Israel security assistance act. https://www.congress.gov/bill/118th-congress/house-bill/815
[6] Brown University Watson Institute for International and Public Affairs. (2024). U.S. spending on Israel’s military operations and related U.S. operations in the region since October 7, 2023. Costs of War Project. https://watson.brown.edu/costsofwar
[7] Associated Press. (2024). U.S. weapons shipments to Israel expand during Gaza war. https://apnews.com/
[8] Brown University Watson Institute for International and Public Affairs. (2025). The wider Middle East: U.S. military deployment costs. Costs of War Project. https://watson.brown.edu/costsofwar
[9] Congressional Budget Office & U.S. Navy procurement analyses. (Various years). Aircraft carrier procurement and operating costs.
[10] Associated Press. (2024). U.S. military buildup in the Middle East amid regional tensions. https://apnews.com/
[11] U.S. Air Force Historical Research Agency. (1973). Operation Nickel Grass: Strategic airlift during the Yom Kippur War.
[12] U.S. Naval Institute. (n.d.). Operation Earnest Will and Operation Praying Mantis: Naval operations in the Persian Gulf.
[13] Defense policy analyses. (2024). Estimated costs of a U.S.–Iran war.
[14] Peterson Institute for International Economics. (n.d.). Economic modeling of war scenarios involving Iran. https://www.piie.com/
[15] U.S. Navy. (n.d.). Tomahawk cruise missile fact sheet. https://www.navy.mil/
[16] U.S. Air Force. (n.d.). B-2 Spirit strategic bomber fact sheet. https://www.af.mil/
[17] Royal United Services Institute. (2023). The economics of Iranian drone warfare. https://www.rusi.org/
[18] U.S. Missile Defense Agency. (n.d.). Terminal High Altitude Area Defense (THAAD) system. https://www.mda.mil/system/thaad.html
[19] Defense News. (2024). Cost of intercepting Iranian missile barrages. https://www.defensenews.com/
[20] Financial Times. (2024). The cost of defending Israel from Iran’s missile attack. https://www.ft.com/
[21] Associated Press. (2024). Houthi attacks destroy U.S. MQ-9 Reaper drones. https://apnews.com/
