Secretary of State John Kerry and some Israelis, notably President Shimon Peres, had high hopes for the latest initiative to improve the Palestinian economy. Kerry arrived at the World Economic Summit in Jordan with his usual unrealistic high hopes for the value of his diplomacy but he did not go there without offering serious incentives to the Palestinian Authority to quit its boycott of peace negotiations that has been going on since before Barack Obama became president of the United States. The United States offered a $4 billion plan that was supposed to both boost the Palestinian economy as well as give PA leader Mahmoud Abbas a tangible benefit for cooperating with Washington’s new plan to restart talks with Israel. But the Palestinian answer wasn’t long in coming. Anyone who has paid attention to Palestinian responses to the various ways that President Obama has tried to tilt the diplomatic playing field in their direction or the way they answered various Israeli peace offers in the last 20 years knows that it was the usual one word reply: no.

As the Times of Israel reports:

Slapping down the notion that the PA might be appeased by Kerry’s focus on economic improvements, President Mahmoud Abbas’s economic adviser, Mohammad Mustafa, said ”The Palestinian leadership will not offer political concessions in exchange for economic benefits.” He added, in a statement reported by the Palestinian Ma’an news agency: “We will not accept that the economy is the primary and sole component.”

Mustafa, who also heads the Palestine Investment Fund, said the PA’s priorities are not economic but rather a political framework for the creation of Palestinian state based on the 1967 lines, with East Jerusalem as its capital, that also ensures the rights of refugees and a political compromise, the Palestinian news agency added.

Investors are nonetheless more than welcome to “come to Palestine,” the statement added.

In other words, the Palestinians say thanks for the cash but no talks except those that guarantee they get everything they’re asking for while giving nothing in return and even then there’s no guarantee they won’t continue the conflict as their insistence on the “right of return” — which is tantamount to calling for Israel’s destruction — indicates.

While this is another humiliating setback for Kerry, it’s actually far more significant than that. It exposes the fallacy at the heart of most efforts to create peace between Jews and Arabs for the last century.

Almost from the beginning of the Jewish return to their ancient homeland, many Zionists as well as their foreign friends thought the Arabs inside the country as well as those in neighboring lands would be won over to the new reality once they realized that the Jews brought development and prosperity with them. The influx into the country created tremendous growth even as the conflict escalated over the course of the first half of the 20th century. Throughout this era, Labor Zionists who combined a desire to rebuild the Jewish presence with socialist ideology believed Arab rejectionism was a function of the exploitation of the masses by an elite that profited from conflict. They thought once it was understood that all would benefit from peace and reconciliation, Palestinian Arab workers and peasants would welcome the Jews. Even hardheaded pragmatists like David Ben Gurion thought this way for a long time. They were wrong.

The Palestinian rejection of the Jews might have been exacerbated by the displacement of some Arab peasants whose landlords sold to Jews but the underlying animosity was always based in a refusal to accept the legitimacy of the idea that Jews would now be equal partners, let alone have sovereignty over part of the land. Only a few Jewish leaders, like Ben Gurion’s nationalist rival, Vladimir Ze’ev Jabotinsky understood that the Arabs could not be bought with prosperity. For them the conflict was about honor and religion, not money. He predicted that only when they gave up their last hope that the Jews could be pushed out or reduced to Dhimmi status would they ever make peace.

But the naïve misconception that the Arabs would realize that coexistence would be good for all persisted long after Israel was born in 1948 amid wars that would continue for decades. Shimon Peres launched the effort that led to the Oslo Peace Accords in large measure on the belief that an agreement would lead to a “New Middle East” where Israel and its Arab neighbors would come to resemble a Mediterranean version of the wealthy Benelux countries. But as Israelis who greeted Oslo with euphoria learned to their sorrow, the Palestinians didn’t care about becoming part of a new Benelux. They embraced terror because they valued the campaign to destroy Israel over their own economic well-being and even the lives of their children.

The last and perhaps most pathetic proof that the conflict isn’t about money came in 2005 when American philanthropists purchased the green houses of Israeli settlers in Gaza at the time of Ariel Sharon’s withdrawal from the strip in order to hand them over to the Palestinians. But rather than become the new owners of a prosperous agricultural infrastructure, the Palestinians destroyed the green houses in a fit of anger that encapsulated their hatred for the Jews.

The same spirit is very much alive today in the West Bank where Palestinian reformer Salam Fayyad remains a man without a party or a constituency because his people value the violence of Fatah and Hamas over his program of good governance and development. Logically the Palestinians should have embraced Kerry’s offer since it promises to boost Palestinian employment by two-thirds and raise wages by 40 percent. But it remains a loser in a political culture in which any plan that would recognize the legitimacy of a Jewish state no matter where its borders would be drawn remains anathema.

The moral of the story is that it doesn’t matter how high a priority either the United States or Israel places on peace or how much an agreement would be to the Palestinians material advantage. They continue to regard economic incentives as merely yet another Western attempt to “buy” their birthright that they reject. They might like the cash — which will hopefully not be wasted or go into the pockets of the Fatah-run kleptocracy in the West Bank that has gobbled so many billions donated to their people in the last 20 years. But it won’t lead to peace. It’s a simple lesson but one which idealistic and foolish Westerners and Jews have refused to learn.

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