Last Updated: Tue Nov 02, 2010 17:41 pm (KSA) 14:41 pm (GMT)

The emptiness of Netanyahu's 'economic peace' plan

Yossi Alpher

Likud leader Benjamin Netanyahu is "spot on" in some of his criticism of the peace process. Annapolis was indeed stillborn, without a chance of success. The most thorny final-status issues remain completely unresolved after a year of negotiating. Hamas is a major impediment to progress. And the Iranian threat is more strategically urgent than the Israeli-Palestinian process.

Given Netanyahu's lead in the polls, these positions are significant.

But Netanyahu's recipe for an improved process, which he calls "economic peace," is hardly the solution we are looking for. Its essential premise - that Palestinians with "full stomachs" will be more moderate politically and ideologically - ignores the failures of 41 years of Israeli and international attempts to manipulate Palestinian politics through a combination of economic carrots and sticks. This is not an economic conflict, but rather a political and even religious one.

As far back as 1967, Defense Minister Moshe Dayan believed that open borders, employment for Palestinians inside Israel and Israeli aid and investments inside the West Bank and Gaza would neutralize any Palestinian drive for political rights. Under Shimon Peres in the mid-1970s and the Likud thereafter, the open borders approach was expanded to comprise Israeli settlement in the territories. It all blew up in Israeli faces with the outbreak of the first intifada in late 1987.

Since then, both Labor and Likud governments have alternately punished and rewarded Palestinians economically in the vain hope of moderating their hostility toward Israel. Likud governments in particular, including Netanyahu's a decade ago, have seemingly favored some form or other of "economic peace" that never generated positive results. But Israeli politicians on the left and center as well - notably, again, Peres - have also argued repeatedly and without substance that a regional economic framework is a feasible substitute or at least precursor for a bilateral Israeli-Palestinian political settlement.

The current situation is a perfect example of the futility and illusion of the economic approach to dealing with the Palestinian conflict. Israel responds to every Qassam rocket fired from Gaza by closing the commercial border crossings, thereby depriving 1.5 million Palestinians of basic commodities. Israel even has international, Egyptian and to some extent Palestinian Liberation Organization backing for this approach.

Conceivably, one could justify this massive violation of international humanitarian law through collective punishment if it showed positive results. But the use over an extended time of economic sticks vis-a-vis Gaza has neither reduced Gazans' support for their Hamas government nor generated a new Gazan peace movement. This is Israel's default option in view of the seeming futility of either talking to Hamas or reoccupying the strip and destroying Hamas. But it is not a productive strategy.

In parallel, under the direction of Quartet emissary Tony Blair, a major investment effort is being directed toward the West Bank. While it is clearly a good thing to improve Palestinians' quality of life, there is no evidence whatsoever that this has moderated or will moderate those Palestinian negotiating positions that make a peace deal so problematic - for example their territorial demands and insistence on the right of return and on exclusive control over the Temple Mount-Haram al-Sharif. Note, too, that both intifadas broke out at times of relative Palestinian economic prosperity, not deprivation, thereby dispelling any illusion among patronizing Israelis and others that "full bellies" keep Palestinians "happy."

Experience also teaches that even when progress is lacking, freezing discussion of the most thorny final-status issues in favor of an economic emphasis or some other approach can only weaken the relatively moderate Palestinian leadership Israel is currently dealing with and make matters worse.

To sum up, economic benefits for Palestinians are as intrinsically good for them as for any people, but they, like economic punishments, offer remarkably little substantive input to the peace process.

Finally, we must pay attention to what is missing from the Netanyahu "economic peace" plan. Does he intend to dismantle outposts and outlying settlements in order to make room for an eventual Palestinian state once prosperity has taught the Palestinians good behavior? His natural political allies for an approach to the Palestinians that ignores or downgrades their most minimal political and territorial aspirations come from the political and religious right, in other words the settlers themselves. This suggests that Netanyahu's plan is really either an excuse for holding onto the West Bank or that it will, willy-nilly, quickly become one.

* Published in Lebanon's DAILY STAR on Nov. 26. Yossi Alpher is a former director of the Jaffee Center for Strategic Studies at Tel Aviv University, and was a senior adviser to Prime Minister Ehud Barak

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