Israel this week passed a law requiring domestic organizations
that are primarily funded by foreign governments to disclose 
this connection in their communications with the government. 
The law, shepherded by Ayelet Shaked, is totally neutral with
regard to the activities of the funded organization. However,
European governments that fund political groups only on the 
left- and far-left of the political spectrum, have denounced the 
law in apocalyptic terms as undermining Israeli democracy and 
rightly inviting international opprobrium.
A major talking point of the law’s critics is that it has “no democratic 
parallel,” and that it puts Israel in the category of non-democratic 
regimes like Russia, and even sets it on the road to fascism. But 
if these claims are true, there is little hope for democracy in the 
U.S., which has had similar rules for decades, and imposed new
ones a few years ago without a peep of international objection.
Critics of the Israeli law generally concede that the required
disclosures are legitimate. They object that the application of 
such disclosure requirements only to groups funded by foreign 
governments, as opposed to those funded by foreign private
individuals (who, unlike the EU, support both left- and right-
-wing political NGOs), are arbitrary and therefore sets Israel 
apart from other democracies. Both claims are specious.

 First of all, treating foreign government contributions 
differently from private ones is entirely commonplace and 
rational, especially in the case of Israel. Governments are 
indeed different from rich individuals. Governments have 
foreign policies, trade rules, and United Nations votes
—and they use the groups they fund in Israel to produce 
documents that they then invoke when taking those actions. 
Private people have no similar powers. As a matter of basic 
democratic integrity, groups that depend largely on 
government funds should not be able to advertise their 
“NGO” status without at least some small-print clarification.
Moreover, Israel has good cause to take a different approach
to the issue than other Western democracies because the 
outsized role of foreign—and specifically European-funded—
groups is particularly egregious in Israel. Protecting the
integrity of Israeli democracy requires special transparency rules.
First, Israel is unique in the sheer scale of the foreign government
sponsorship of domestic political groups. For example, the 
European Union alone has in recent years given roughly 1.2 
million Euro a year for political NGOs in the U.S,. and roughly an
order of magnitude more in Israel—a vastly larger per capita
amount. This is magnified by similar imbalances in funding by 
individual European countries. There is a unique secrecy 
concerning the processes by which funding is granted to Israeli 
non-profits by the EU and many individual governments, 
including refusals in response to Freedom of Information requests.
Secondly, Europe itself has unique rules about funding Israeli
groups, which have no parallel elsewhere. Under Article 15 of 
the EU’s special guidelines for funding Israeli groups, 
organizations dealing with the territories are only eligible for 
funding if they declare that their activities promote EU foreign 
policy, and the EU agrees. These are groups that get the bulk 
of their funding from the EU, but only if they promote Brussels’s
interests—the very definition of a foreign agent.
Indeed, even the United States uses NGOs as proxies to meddle
in internal Israeli affairs. As the U.S. Senate Permanent 
Subcommittee on Investigations (PSI) reported yesterday, 
the State Department funded an Israeli political organization
that later ran a campaign dedicated to ousting Israeli Prime 
Minister Benjamin Netanyahu.
The distinction between getting money from a foreign government
and a foreign person is basic, and reflected in U.S. law. The House 
of Representatives requires from those who testify before it a 
disclosure of monies received specifically from foreign governments
—just like the Israeli law.
More egregiously, the Israeli law is so clearly aligned with the
American Foreign Agents Registration Act (FARA) that both 
Obama Administration officials and political groups have made 
the false claim that unlike the Israeli measure, FARA applies “equally” 
to foreign governments and foreign people. This is demonstrably 
false as a matter of the intent, application, and text of FARA. In 
fact, FARA only applies, in law and practice, to donations from 
foreign governmental actors.
[to continue reading go here]