The current law, due to expire on June 1, allows the NSA to collect bulk data on numbers called and the time and length of calls, but not their content.

Efforts by Congress to extend the law so far have proved fruitless, and Congressional aides said that little work on the issue was being done on Capitol Hill.

Read More Want to be invisible online? There's an app for that

There are deeply divergent views among the Republicans who control Congress. Some object to bulk data collection as violating individual freedoms, while others consider it a vital tool for preventing terrorist attacks against America.

Ned Price, a national security council spokesman, told Reuters the administration had decided to stop bulk collection of domestic telephone call metadata unless Congress explicitly re-authorizes it.

Some legal experts have suggested that even if Congress does not extend the law the administration might be able to convince the secretive Foreign Intelligence Surveillance Court to authorize collection under other legal authorities.

But Price made clear the administration now has no intention of doing so, and that the future of metadata collection after June 1 was up to Congress.

Read MoreiPhone encryption 'petrified' NSA: Greenwald

Price said the administration was encouraging Congress to enact legislation in the coming weeks that would allow the collection to continue.

But Price said: "If Section 215 (of the law which covers the collection) sunsets, we will not continue the bulk telephony metadata program."

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NSA spying law set to expire

On some level, the reports that Israel spied on Iran-U.S. nuclear talks don't come as a shock. Just last year, German newsmagazine Der Spiegel reported that Israel had eavesdropped on Secretary of State John Kerry during Middle East peace talks. Jonathan Pollard,who was arrested in November 1985 after passing secret documents to Israel while working as a civilian analyst for the U.S. Navy,has become a cause celebreamong some Israelis.

In fact, as we learned after the2013 revelation that the NSA was tracking German Chancellor Angela Merkel's phone, allies spy on one another all the time. "I have a word of advice for American allies outraged by alleged NSA spying on their leaders," conservative analyst Max Boot wrote in the New York Postafter that scandal broke. "Grow up."

Germany was angered by the NSA revelations, but it was soonembarrassed by reports that it wasitself spying on anally in this case, Turkey and had eveninadvertently intercepted calls made by Kerry and Hillary Clinton. AsBernard Kouchner, a formerFrench foreign minister, put it, the problem wasn't so much that nations spied on their allies it was that the United States was better at it.Lets be honest, we eavesdrop, too," Kouchner told a French radio station. "But we dont have the same means as the United States, which makes us jealous.

As such,it is tempting to look at these new reports and come back with simple schadenfreude: It seems as if theUnited States is just getting a taste of its own medicine. But there is something distinctabout the new allegations.It's not just that Israel wasallegedly spying on the U.S. talks with Iran. According to reports, it was then using the information gleamed from it to undermine U.S. foreign policy.

According to Adam Entous of the Wall Street Journal, Israel's surveillance of closed-door talks between Washington and Tehran was used to gather information that was then passed on toU.S. lawmakers. This detail is apparently what is causing the most anger within the White House.It is one thing for the U.S. and Israel to spy on each other," one unnamed U.S. official told the Journal. "It is another thing for Israel to steal U.S. secrets and play them back to U.S. legislators to undermine U.S. diplomacy."

Israel has denied the reports, though few people buy it. "I'd be more surprised if Israel did NOT spy on the Iran nuclear negotiations,"Steven A. Cook, a senior fellow at theCouncil on Foreign Relations, tweeted on Tuesday. And given the state of relations between the White House and Israeli Prime Minister Benjamin Netanyahu, the idea that they passed on details to lawmakers seems distinctly plausible.

[Read: Obama says Netanyahu statements leave little room for serious peace talks]

Netanyahu, who was reelected as Israel's leader last week, caused a furor when heacceptedSpeaker John A. Boehners invitation to addressCongress this month. Although the Israeli prime minister denied reports that he would risk bipartisan U.S. support for Israel, many observers saw the speech as a direct appeal to President Obama's Republican rivals and an attempt to undermine a sittingU.S. president."The planned speech,"Chuck Freilich, a former deputy head of Israel's National Security Council, wrote, is "essentially an attempt to mobilize Congress against the administration."

Despite objections,Netanyahu went ahead with the speech. And then, to the surprise of many analysts, he was reelected last week. The Obama administration offered him a lukewarm note of congratulation at best, noting that Netanyahu's Likud Party had won a "plurality" of seats. Later, Obama said that the United States was reassessing its relationship with Israel after controversial comments made by the Israeli incumbent in the last few days before the election.

Theimpression given by all this is of a uniquelyduplicitous Israeli administration. And if the latest reports are true, they seem remarkable: It's hard to think of another instance when a nation spied on an ally and then shared information with the ally's domestic rivals. But then again, espionage is by its nature secret. And it's worth remembering that the only way these new reports came to light wasby an allyspying on its ally Entous reports thatofficials told him that "U.S. intelligence agencies spying on Israel intercepted communications among Israeli officials" featuring details that could have come only from confidential talks.

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WorldViews: Allies spy on allies all the time. Did Israel do something worse?