Why Settlements Spell End of Peace

Israel’s Cabinet has decided to grant settlements in the West Bank a special economic status that includes tax breaks and subsidies for housing, education and investments.

These benefits had been discontinued by the previous Labor government. While their reinstatement does not translate automatically into the enlargement of existing settlements, both Palestinians and Israelis believe that will be the result.

The cabinet’s decision is likely to have explosive consequences. New settlement activity would do more than exacerbate an already tense situation between Israel and the Palestinians. It would constitute an abandonment of the fundamental terms of the historic bargain that Israel and the PLO entered into in 1993. Unlike the frequent violations of provisions of the Oslo agreements that both sides have been guilty of in the past, a resumption of settlement activity removes the ground from under the Oslo accords.

The heart of the Oslo agreements is an implicit historic trade-off between the two parties. The ultimate and irreducible goal of the Palestinians always has been and remains statehood, even if that state’s sovereignty is constrained to accommodate Israel’s vital security needs with such things as significant Palestinian demilitarization and Israeli control of Palestinian skies. With the Oslo accords, Israel agreed not to preclude such statehood--indeed, it acknowledged the likelihood (as it did explicitly when Labor formally removed opposition to Palestinian statehood from its party platform)--in return for a commitment from Yasser Arafat that he will suppress the Palestinian terrorist groups.

It was clearly understood by the Palestinians that Israel would not put up with a neighboring Palestinian entity that was less than firm in combating Palestinian terrorism, for security is Israel’s irreducible goal. By the same token, it was clearly understood by Israel that Arafat could not wage a war against fellow Palestinians and remain in power if Palestinians were denied the hope of ultimately achieving statehood. These were the fundamental terms of the historic bargain that yielded the Oslo accords.

Oslo nearly fell apart earlier this year when Arafat failed to dismantle the infrastructure of Palestinian terrorist organizations in the areas he controlled. But after the terrorist attacks in Jerusalem and Tel Aviv that killed 62 Israelis in February and March, Arafat changed course and shut down the institutions and infrastructure of Hamas and Islamic Jihad. As noted recently by Chemi Shalev in Israel’s Maariv, from that day to this, the Palestinian Authority’s anti-terrorist actions have been seen by Israel’s security and intelligence community as the main reason terrorists “are not washing the country with rivers of blood and terror.”

A resumption of settlement activity would constitute an abandonment of the terms of the historic bargain that Israel and the Palestinians entered into. Furthermore, formal agreements aside, the notion that Arafat is capable of waging war on Palestinian terrorism even while Israel removes what hope there exists for Palestinian statehood is unrealistic. In these circumstances, Palestinians would see Arafat’s action against Palestinian extremists as nothing short of collaboration with an Israeli government bent on denying minimal Palestinian aspirations.

It is entirely predictable that should settlement activity resume, it will precipitate Palestinian protests of unprecedented intensity that will lead to violence. Equally predictable is that Prime Minister Benjamin Netanyahu will once again admonish Palestinians, as he did after the opening of the Jerusalem tunnel, that under the terms of Oslo, Palestinian grievances must be brought to the negotiating table and not unilaterally resolved by resort to violence. That admonition will ring hollow, for Netanyahu has made it clear that he, too, acts unilaterally and does not feel bound to bring contested issues to the negotiating table.

The implications of this new impasse between Israel and the Palestinians transcend by far any previous violations of the Oslo understandings, for settlement activity involves the abandonment of basic terms. It will destroy what remains of the Oslo peace process and preclude the fashioning of a new framework for peace. For this Israeli government, such paralysis may not be entirely intolerable. For the Palestinians, however, whose economy is virtually in a free fall, and for Arafat, whose leadership is under challenge by those who saw the original Oslo agreements as a Palestinian disaster, the status quo is a time bomb waiting to explode.