First, putting aside Israel for a second. I understand the urge to reduce foreign aid while we're running deficits (I assume is what you mean by "floundering"), but think of foreign aid as diplomacy. We need both hard (military) and soft (aid, donations, etc.) diplomacy. If any thing, the bang for buck is higher with soft diplomacy. Hard diplomacy is very expensive.

Second, Israel is a shining example of a robust democracy in a part of the world that is more or less run by kleptomaniacs and dictators. Israel's politics -- especially with the coalition government -- serves as a role model for citizens of other countries. I think it seems reasonable that we extend foreign aid to them.

It pays off in the long run.