Defense What Price Sky-High Glory?

By John Greenwald

Top Israeli generals would gladly kill it, and so would Defense Minister Yitzhak Rabin. Yet rising criticism and soaring costs have so far failed to force Israel's Lavi jet fighter program off course. The time has come, however, when Jerusalem must decide whether to funnel more billions into the troubled Lavi (Hebrew for lion) or scrap a warplane that has become a symbol of national pride and a key source of jobs. The need to make that choice has triggered a vitriolic debate in which military and economic issues have frequently given way to pure emotion. "The real question," shouted Knesset Member Yosi Sarid last month, "is whether we become a state which has a fighter plane or a fighter plane which has a state." Even Rabin admits that the choice is the "most difficult and important decision faced by an Israeli government in more than a decade."

The decision seemed simple enough when the Israeli Cabinet approved the Lavi in 1980. Jerusalem had long wanted an advanced fighter that could dodge antiaircraft missiles while skimming battlefields to blast enemy targets. As then Defense Minister Ezer Weizman envisioned it, the plane was to be "small and cheap -- but a bastard" in combat. Over the years, though, Weizman has become a leading opponent of the plane. Says he: "It is too costly, comes too late and at the expense of more important objectives." Today the aircraft represents the perils that a small, defense-minded country can confront when it sets out to produce a world-class warplane of its own.

From Tokyo to Brasilia, leaders dream of building advanced aerial weaponry to swell their arsenals and boost military sales abroad. While thinking big, however, they often give little thought to the ultimate cost. India is investing up to $4 billion to build a lightweight fighter that will become the backbone of its air force in the late 1990s. Japan is debating whether to spend up to $10 billion on its proposed FSX fighter or buy comparable U.S. versions for as little as half the price. France continues to push ahead with its $5.8 billion Rafale fighter even though German, British and Italian companies are collaborating on a similar plane.

Experts warn that such grandiose projects involve heavy risks. "Without doubt, a high-tech military industry can generate economic growth," says Stephanie Neuman, a Columbia University political scientist. "But a nation must not only want to invest. It must be able to afford it as well."

As Israel's chief benefactor, Washington has become an increasingly uncomfortable hostage of the Lavi affair. While the U.S. Government gives Israel $1.8 billion a year in military assistance -- far more than to any other country -- the Lavi claims an ever growing portion of that aid. Washington has so far provided most of the $1.8 billion that Israelis have spent to develop the Lavi and build two prototypes since 1979. But that is just the beginning: development costs that were estimated at $800 million when the project began could reach at least $2.75 billion by the time the first of up to 150 jets rolls off the assembly line in 1993. Meanwhile, the price tag for each plane has climbed from $7 million to $18 million.

In view of those overruns, Washington is pressing Israel to scrap the Lavi and buy U.S.-made fighters. Defense Secretary Caspar Weinberger has called the Lavi an "inferior plane" that would not boost Israel's military strength "in any significant way." Washington has offered generous terms to wean Israel from the Lavi project. In one proposal, the U.S. has offered to sell General Dynamics F-16s and McDonnell Douglas F-18s at favorable prices. Reagan Administration officials sweetened the deal two weeks ago when Rabin visited Washington. Among other things, the Administration agreed to accelerate delivery of up to 100 F-16Cs and suggested that Israel use U.S. aid to pay the estimated $700 million that it will take to shut down the Lavi project.

U.S. opponents of the Lavi jet fighter have a surprising number of Israeli allies. The chiefs of all three Israeli military services have urged that the project be dropped to free funds for land and sea forces. Military planners say a combination of pilotless drones and surface-to-surface missiles would be cheaper and more effective against battlefield targets without risking the lives of pilots. Even Air Force Chief Amos Lapidot is lukewarm. Says he: "I like the Lavi, but I can live without it."

Yet the Lavi has staunch defenders. Foremost among them is the powerful Israel Aeronautics Industry, a company that employs 20,000 workers and insists that the plane is a vital spur to Israel's high-tech industries. Some 5,000 of the firm's workers gathered outside Prime Minister Yitzhak Shamir's office two weeks ago to demand that the project continue. Their concerns appear well founded: economists at the Israeli Defense Ministry estimate that cancellation of the Lavi would put 5,000 engineers and technicians out of work immediately.

Faced with such pressure, Israeli leaders have been scrambling for a compromise. Both Shamir, who leads the right-wing Likud Party, and Foreign Minister Shimon Peres, the Labor Party chieftain, want to save the warplane. But Labor's Rabin and Likud Finance Minister Moshe Nissim lead a dogged opposition in the 25-member Cabinet. One solution calls for cutting development costs by about $350 million a year through 1991 -- a scheme that Columnist Yoel Markus of the daily Ha'aretz newspaper labeled the "last refuge of the cowards." In recent weeks the Cabinet has tabled a vote on the Lavi from meeting to meeting, but a showdown is expected by the end of the month. If the Lavi remains completely on course after that fateful Cabinet meeting, it would deserve to be nicknamed the Phoenix.

With reporting by Ron Ben-Yishai/Jerusalem and Bruce van Voorst/Washington