Israel's payoff...

Iraqi oil.

Update 6/16: A comment from Joe (that the plan is to privatize Iraq's water - selling some of it to Israel) prompted me to find this link for you:

For Israel, the water question was the key to the land question.
--Stan Goff, FTW, June 14, 2004

[...]

At the Third World Water Conference in Kyoto, Japan in 2003, Mikhail Gorbachev stated that in recent history there have been 21 armed disputes over water and 18 of those involved Israel. Yehezkel Lein, a water expert for B'tselem - an Israeli human rights group - stated, "There is a clear linkage between the gap in water availability and the occupation."

[...]

While the Middle East may be one of the worst potential flash points for water conflict, it is not the only region of the world prone to water wars. The CIA predicts that:

…water scarcities and allocation will pose significant challenges to governments in the Middle East, Sub-Saharan Africa, South Asia, and northern China. Regional tensions over water will be heightened by 2015…By 2015 nearly half the world's population-more than 3 billion people-will live in countries that are "water-stressed"

[...]

In 1996, Vice President of the World Bank Ismail Seregaldin predicted the wars of this century would be over water. It is the oil of the 21st Century. The trend of privatization is based on a systemic belief that the private sector can function more efficiently than public municipalities, but the goal which drives this belief is profit, not efficiency.

Throughout the world, water privatization has proven time and again to be less efficient than public municipal systems. The largest private water companies are Germany's RWE and the French multi-nationals Vivendi & Suez.

We are starting to see just how high the price of life can be. In Bolivia, a Bechtel subsidiary made it illegal to collect rainwater on one's own property without a permit. In Africa, the trend is leaning toward privatized water meters that deny fresh water to those who can't afford it. In Canada, the battleground is over bulk water exports. Various "water wars" in America are just beginning to show signs of stress in the southwest, while water wars in Israel and Palestine are nothing new.

[...]

Water is a human right, and there should be no question about that. How can one even talk about the right to life, liberty, and the pursuit of happiness without a prerequisite of the right to fresh water?

Water = Life. It's a simple equation.

The global capitalists do not believe the above equation to be completely true. Instead, they offer an opposing equation of water = commodity. In this equation, water is equivalent to, say, pork bellies. Water is a product to be bought and sold to the highest bidder.

[...]

The endgame of Neo-Liberalism is a one-world government run by corporations, devoid of any democratic principles.

Read more....at From the Wilderness

Update update:

Water Privatization Fiascos: Broken Promises and Social Turmoil, a March 2003 water privatization report (pdf) by Public Citizen with case studies from Buenos Aires, Argentina; Atlanta, Georgia, USA; Manila, The Philippines; Cochabamba, Bolivia; Jakarta, Indonesia; Nelspruit, South Africa; The United Kingdom

Turning Up the Tap: How the Private Water Industry Wants to Boost Profits – at the Expense of Taxpayers (pdf)

Click graphic for the U.S. Water Contract