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.
"a 2013 National Intelligence Estimate on cyber threats “ranked Israel the third most aggressive intelligence service against the US” behind only China and Russia" [1]
"Israel among the U.S.’s most threatening cyber-adversaries and as a “hostile” foreign intelligence service." [2]
"Israel’s snooping upset White House because information was used to lobby Congress to try to sink a deal" [3]
I think it is probably fair to assume that every country (friend or a foe) spies on others.
Just a few months ago, we were caught red handed spying on the EU and our closest allies [0]. I’m sure their equivalent of NSA lists us as the most aggressive hackers behind China and Russia.
When your economy or your survival (in Israel’s case) is at stake and you have the tools, the temptation is just too strong.
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.