2009 Annual Conference Panel IV: Arab-Israeli Peace and the Domestic Political Obstacles
Featuring Toni Verstandig, Murhaf Jouejati, Daniel Kurtzer, Daniel Levy, Khalil Shikaki
These remarks were delivered at MEI’s 63rd Annual Conference, November 10, 2009. Kate Seelye:  Last but not least today, we have the Arab-Israeli panel. We thought we would address the most intractable issue at the end. Here to moderate the panel is Toni Verstandig, who we are very pleased to have with us today. She is the Director of Middle East Programs at the Aspen Institute and the Senior Policy Advisor at the Center for Middle East Peace and Economic Cooperation. Ms. Verstandig has also served as Deputy Assistant Secretary of Near Eastern Affairs at the State Department, where she directed and coordinated US bilateral relations and overall policy developments regarding Israel, Jordan, Syria, Lebanon and the Palestinian Authority. Toni Verstandig:  Thank you, Kate. Thank you to the Middle East Institute for bringing together such a distinguished group of panelists who are gathered here today to discuss the Arab-Israeli peace process. Yes, it is intractable, but I would like to suggest and hopefully catalyze and urge our panelists to engage in some new thinking. Over the last days there has been endless analysis over the inability to restart the negotiations. The question is, what is the right prescription to move the parties together after both sides have gotten themselves so far out on a limb? As Bill Burns, who was with you this morning, commented, “The Middle East is a region of deep discontent in an area that teaches us great patience and humility.” I think we would all concur and agree with that comment. We are painfully aware that time does not work to the advantage of those supporting Middle East peace, nor is it a useful tool in a Middle East tool box. However, I would like to suggest that the internal pressures and challenges that each side faces can also be turned around as opportunities for peacemaking if there is a degree of trust and leadership infused into the process. What we have seen over the past several months is a United States president stepping out in his early days of his administration and making a strong commitment to achieve a comprehensive Israeli-Palestinian agreement; appointing Senator George Mitchell as special envoy, a clear signal that the president and the secretary of state were determined to move forward quickly; and finally, a continued reaffirmation, especially over these last days, that this administration will stay the course notwithstanding the difficulties that have occurred. However, the last several months have demonstrated that there are difficulties toward achieving an end to the conflict and a two-state solution notwithstanding this commitment and the clear determination of the US administration. On the Palestinian side we have seen in recent days President Mahmoud Abbas indicating that he will not only not run for reelection but that he may well step down as president of the Palestinian Authority. Is this the beginning of a major paradigm shift on the Palestinian scene? Are we now looking at a sober reality that there really is no partner for peace where there once was? On the Israeli side, Prime Minister Netanyahu – who is here in Washington – yesterday called for restarting the peace talks, but on what basis? What are the terms of reference? Where does the Arab peace initiative come into play? Will it remain a viable instrument or do we risk it being taken off the table at the upcoming spring Arab League meeting? On the Syrian side, progress was reported in the Turkish-sponsored Syrian-Israeli track. That channel now seems to have been put aside. At what point can bilateral talks between Syria and Israel be resumed? When will Syria take steps toward peace and withdraw its support for groups whose sole mission is to undermine the peace process? Today Lebanon is on the eve of announcing a new government. Where does Lebanon fit into the peace process? What confidence-building steps can be taken in areas such as Ghajar or Shebaa Farms to enhance Lebanon’s sovereignty and bring Lebanon to the peace table? I am looking forward to our panelists today to address these aspects as well as the internal dynamics of the Palestinian, Israeli, Syrian and American scenes. But I am urging our panelists to roll up their sleeves and offer some new thinking. I don’t want us to rehash where we have been but to think outside the box. Is it time to move forward to a comprehensive settlement and reset the peace table and get out of the current construct of process and move toward launching a full comprehensive approach? Does the Arab peace initiative provide the regional safety net for such an approach? I look forward to this discussion today. Now I would like to briefly introduce our panelists. As you know, their full bios are in the conference brochure. Khalil Shikaki, who will begin the presentation, has done invaluable research and polling as Director of the Palestinian Center for Policy and Survey Research in Ramallah, which has conducted more than one hundred polls among Palestinians in the West Bank and Gaza Strip since 1993. Currently he is an Associate Professor of Political Science and a Senior Fellow at the Crown Center for Middle East Studies at Brandeis University. Daniel Levy wears several hats as Director of the Middle East Task Force at the New America Foundation and as Director of the Prospects for Peace Initiative at the Century Foundation. He has long experience working with different Israeli governments on peace-related matters and in 2001 was a member of the official delegation to the Taba negotiations. Murhaf Jouejati is a Professor of Middle East Studies at the National Defense University’s Near East and South Asia Center for Strategic Studies. He also teaches at George Washington University. Murhaf was an advisor to the Syrian delegation during the Middle East peace talks throughout the 1990s. Finally, Ambassador Dan Kurtzer has had a long and distinguished career in the United States State Department. It culminated in his serving as Ambassador to Egypt from 1997-2001, followed by an ambassadorial posting to Israel from 2001-2005. Today he holds the S. Daniel Abraham Chair in Middle East Policy Studies at the Woodrow Wilson School of Public and International Affairs, and most importantly Dan works very closely with me and is a dear friend. Khalil Shikaki:  Thank you, Toni. Two things happened in the last two or three years that are turning points. One just happened about two days ago: the Abu Mazen decision not to run for elections. This is a major turning point, one that was preceded by what has also been a very important event in Palestinian-Israeli relations (although it is a very Palestinian issue): the Hamas takeover of Gaza. The Hamas takeover of Gaza has unleashed new dynamics in Palestinian politics, leaving very negative consequences on domestic political issues but surprisingly having highly positive outcomes (intended or unintended) on Israeli-Palestinian relations – in fact leading to a great success for Abu Mazen. However, a few days ago Abu Mazen realized that he has been the victim of his success. He therefore decided he does not want it. He decided to destabilize the situation as a way to move forward. From this day on Abu Mazen is completely changing his strategy. Two or three years ago his strategy was to stabilize the situation. Now he wants to do the opposite. So what I will do in the fifteen minutes that Toni gave me is to explain to you why he is doing that and where we might be heading from here. What did Abu Mazen do in the last few years? He did four things. One, he essentially delivered effective stability in the Palestinian area in the West Bank and in Israeli-Palestinian relations. He delivered unprecedented security for the Israelis. Thirdly, he strengthened ties with the US in a manner that we have not seen during the last nine years. Finally, he reformed Fatah. In fact I would claim that Fatah has now resurrected from the dead. So let me say something about these four things that he has done. I will be doing so fairly quickly because I can only give you an outline of what these things meant. On effective stability, he delivered the following. (When I say he, I obviously mean he and the Palestinian Authority that he had been restructuring. That also means that what Salam Fayyad has been doing for the last two years or so.) First of all, he effectively strengthened the institutions of the Palestinian Authority so that today they are able to deliver greater services to the public than these institutions have been able to deliver in the past sixteen years. Service delivery and strong public institutions is something that Fayyad and Abu Mazen have been delivering. Secondly, we have never had better financial management than the one we have today. Thirdly, the situation of anarchy that prevailed since 2000 has now been effectively ended. Palestinians feel it. When the elections took place in January 2006 we asked voters how they feel about their own safety and security under the Palestinian Authority; 25 percent said they feel safe and secure. Our last survey indicates that this percentage has now jumped to almost 60 percent. That is a significant achievement. Most of it has been delivered during the last two years. He also reformed the security services. The security services have never been as strong and better organized than they have been at any time, again since 1993. Warlords have been terminated; they are no longer in the services. There is a chain of command that never existed before. The Palestinian security services for the most part – with a few exceptions remaining – are becoming more and more professional. They are much better trained than they were before. For the first time there is full control by civilians and security services actually carry out orders by civilian politicians. These are major achievements for this team. Fifth in the list of things they have delivered, they improved the justice system, although there is a lot to be done still. Courts are functioning and people actually resort to the justice system – not everybody but more than we have seen during the past sixteen years are now turning toward the court system. Economic conditions have improved and perhaps the best news for Fatah – when and if they go to the next elections – is that public perception of corruption has gone down considerably. On the eve of the elections of 2006, 90 percent or more of the public told us that the Palestinian Authority was corrupt. Today the percentage is in the sixties. That is a significant achievement and again it is for the most part thanks to what Fayyad and Abu Mazen have done. Secondly, unprecedented security has been delivered, particularly during the last two years. This happened as a result of three things. One, there has been a crackdown – not on Hamas first, but on Fatah first. About 1,000 armed men that were identified by the Israelis as wanted fugitives have now been disarmed; some of them spent time in jail, most of them are free today and can go home. But for the most part, when Fayyad took over he made a deal with the Israelis whereby these people were to be pardoned after they had been disarmed and agreed to stop the violence. They have done that. Fatah for the most part does not have a militia in the West Bank. This is a major achievement. Arafat could not deliver that, certainly not throughout most of the period of the last ten years or so. There has also been a crackdown on Hamas. Some 1,000 Hamas members are today in Palestinian jails. This has come at a cost. Enforcement of order did not mean enforcement of law. Most of the 1,000 men have not seen a judge, have not been charged with anything. Three out of four of the Hamas infrastructure have been targeted: the military (most of Hamas’ military men are in jail); the financial infrastructure has been targeted effectively again; the social infrastructure (not all of it, but a significant part of it has been targeted). The only infrastructure that has not been targeted is the political. The reason that Abu Mazen, Fayyad and Fatah have been doing this is not to please the Israelis; they are doing it because of what I started with, the first turning point: the Hamas takeover in Gaza. In a survey we conducted among Fatah delegates to the sixth congress, which took place last August in Bethlehem, 95 percent of the delegates identified Hamas as a violent coup d’état movement. There is a great deal of threat perception and fear of Hamas that is reflected in the steps that have been taken so far. Secondly, there is greater Israeli-Palestinian security coordination than we have seen since 2000. In some cases in fact, better than it has been since the start of Israeli-Palestinian security coordination as part of the Oslo process. Thirdly, the actual outcome of the steps that have been taken in the crackdown, the coordination and what I have described earlier about the reforms in the security sector, is that we now have – and for the last year and a half in particular – unprecedented calm in Israeli-Palestinian relations. Israelis are not being killed and injured. Some Palestinians and Israelis are still fighting each other in Gaza but not in the West Bank. Thirdly, strong ties with the US – another achievement for Abu Mazen and Fayyad. We have been going back to the days of pre-Camp David, when Arafat was a good friend of the Clintons. Abu Mazen actually managed, particularly since the Annapolis process with the Bush administration, to strengthen Palestinian-American ties and improve his own personal relationship with both Bush and later Obama. This was seen as affecting the American position – seen by the Palestinians – with regard to settlements and the current administration demand for a settlement freeze. It was also reflected in how Palestinians reciprocated with significant change in public attitudes regarding the US and the demand for US intervention in the process. We saw until recently that the public was becoming a lot more welcoming of a US intervention, a lot more optimistic about the outcome of a US intervention; in fact in our surveys we found that about one-third of those who oppose a permanent settlement with Israel because of the terms of the settlement would change their mind and support it if it was predicated on a strong US (Obama) intervention to force both Israelis and Palestinians to implement it. That is a significant achievement. When you change about one-third of the population that is about 15 percent of all of the Palestinians. By the way, although the Israelis are not all that happy with this, we also found that a significant part of the Israelis too change their mind and accept compromises that they were not willing to accept if it was predicated on a strong American intervention. Fourthly, reforming Fatah: something that Arafat could not do. Fatah finally is reformed. The fragmentation within Fatah has now been dealt with. The ability of Abu Mazen to bring Fatah to a sixth congress, where 2,300 people met in Bethlehem and elected a totally new leadership – a leadership that comes essentially from the inside, which means basically it has two goals: one, end the occupation and (most important) stop the settlements in the short term; second, build a state. Palestinians on the inside have always, since the late 1960s, focused basically on these two goals: build a Palestinian state and end the occupation and the settlement buildup. This is something that the insiders have always wanted. It took the outsiders a long time to finally come along and accept it. In 1988 the PLO on the outside – the old guard – finally endorsed these goals of the insiders. Now in Bethlehem last August the change was completed with a new leadership that was almost entirely from the inside taking over the leadership of Fatah and essentially of the PLO. This is a major transformation in Palestinian politics and will have consequences for how Palestinians manage their own affairs, particularly the politics of the Palestinian national movement. The old guard have been removed; 95 percent of the old guard are no longer in power. They have been democratically removed from power as a result of this reform. The old guard were accused of lacking competency, being incompetent and corrupt. There is no doubt that the new leadership will have a much better time winning elections, if and when they go to elections. The institutions that Fatah controls now – the Fatah central committee and Fatah leadership council – these are the two institutions that are supposed to make decisions for Fatah. These institutions were totally out of touch with the Fatah rank and file. Now those people who sit in these institutions are the people who control the street. They are the real leaders of Fatah. Fatah’s institutions are therefore greatly strengthened by the reform that Abu Mazen has just introduced. I am running out of time so I will get quickly to where Abu Mazen then discovers that everything good that he had done is in fact not helping him get what he really wants. Up until last year, in his talks with Olmert, Abu Mazen actually had hope that what he was doing – all these achievements that I have just described – were actually paying off. Yesterday for the first time, he said this to a Palestinian audience, in a meeting with Palestinian businessmen – he said something that I thought he would never say in Arabic to a Palestinian audience: We almost made a deal with Olmert. He said progress was very impressive, that we were very close – he used the word “very close” – to reaching a deal. Then he went on to outline what kind of progress was made. On borders, for the first time he revealed that there was an exchange of maps and that significant progress was made on determining the borders of the Palestinian state, not only in the West Bank but also in Jerusalem. He talked positively about progress on the refugee question and in security. The only area he did not talk about was the holy places but in everything else he seemed to have indicated that there was significant progress. That is what kept him going, that feeling that he was making progress. With the election of Netanyahu, things began to change for Abbas. The stability he delivered, once Netanyahu was in power, meant the status quo is there to stay. If Abbas is able to deliver effective stability, why should the Israelis move forward? This is what Abbas is now calculating, that this stability is giving Netanyahu the option of maintaining the status quo. What Abu Mazen and Fayyad have been doing their best to avoid is in fact now, they fear, a reality. Secondly, the unprecedented security he is delivering to the Israelis is now perceived by the Palestinians as collaboration with the occupation. He and Fayyad cannot stay for long delivering this kind of security in the absence of political progress. He is concluding that political progress is not coming and he will end up being depicted as a collaborator. Thirdly, good relations with the US comes at a price. He suffered the consequences. He was summoned to New York – he came. He was asked to delay the discussion and the vote on the Goldstone report – he agreed. He suffered the consequences. He was seen and described and accused of betraying Palestinian interests. His attempt to maintain good relations with this administration has put him in a position where all of Fatah – the new Fatah – has been against him. Perhaps what was finally the event that crystallized to him what he needs to do was when Secretary Clinton stood next to Netanyahu and praised him for continued violation of the roadmap. That is how Abu Mazen read what Clinton said: the US administration was basically giving its blessings to something that was in violation of the roadmap: continued Israeli buildup. For Palestinians, anything less than a comprehensive phrase is business as usual with regard to settlements. Abu Mazen today is not Abu Mazen of the past. He now is a lot more accountable. Remember these institutions he reformed in Fatah? They demand accountability. One thing they want and they will not change their mind about is a total freeze on settlement construction. Abu Mazen today feels the administration has betrayed him on this. Finally, Fatah reforms. Well, I have just said it. The reforms mean he becomes more accountable. He is no longer Arafat; he is no longer the leader of the old guard. He is now a lot more accountable man. Fatah has become more democratic. He needs to be transparent with them and this is something he is not good at. Part of what he is doing is actually to punish Fatah, not just the US and Israel, for what he feels they have done to him. So what is his game plan? His game plan is to start a process of destabilization. He starts by announcing that he is not going to run. Actually he wanted to start by announcing his resignation. He was convinced that this was a more dramatic step, that he needs to do something that was reversible and not resign, so he decided not to resign. But I believe resignation is going to come. It might not be the next move. If any of you have any plans to go to Ramallah and if any of you today thinks that you have made an appointment to see Abbas – forget it. He is not going to see you. He will start cutting ties. He will start shutting himself off. Then he will resign. When he resigns, everybody else will resign. No one is going to want to stay once Abbas resigns. That means Fayyad will be forced to resign. If someone decides to contest the elections – he says he is not going to run – they have to think about the platform. If the platform is a peace process platform, forget it – nobody else is better than he is for that platform. And he is resigning because he says there is no peace process anymore, that diplomacy has failed, negotiations are futile. Therefore no one can contest the next elections adopting his vision, because his vision is dead. That is what it means if he goes along with the steps that I have just described. So what he intends to do is to start shocking the system one step at a time in the hope that before it becomes too late, before the PA is completely dissolved, someone will take a sane step and try to put the peace process back on track, before it becomes too late. So what if that does not happen? There are two possible alternatives. One, the Palestinian national movement – Fatah – and Fayyad in particular will go unilateral. That is what Fayyad had said. The idea of a Palestinian state in two years with Israel, if Israel is willing to go along, or despite Israel’s objections if Israel does not want to go along – this is the unilateral approach to ending Israeli occupation. Many people might want to go along that way, particularly within Fatah – not everybody but many. In the survey I told you about among Fatah delegates to the sixth congress, the 2,300, we found that 60 percent of them actually work for the PA in the security services or in the civil sector. In other words these people have a vested interest – it affects their pocketbook – what happens with the PA. They want the PA to continue and they want it to continue even if the peace process is failing and even if state-building is done unilaterally. So Fayyad will have some friends. But three questions he still does not know how to answer. One, what about the borders of the state? If we go unilateral, what borders are we going to have? The 1967 borders is what Palestinians want and he has absolutely no way of guaranteeing that he gets the 1967 borders. Second, what about Jerusalem? He needs to say something about the capital. So far his unilateral plan does not have any answer about Jerusalem. Thirdly, who controls the international crossings? If it is Israel, then it is not a state. So he has to figure out a way he can answer these three questions. At the moment he is the most important individual in the Palestinian Authority who thinks unilaterally. He needs a lot more strong personalities from within Fatah to come on board. So far very few have been willing to expose themselves and come on board because they still do not have answers to these three questions. A second alternative is to actually make the dissolution of the PA a strategy in the hope that without the PA there will be a de facto one-state outcome. How Palestinians will get there, what strategies they will adopt – violent or non-violent – is something that at the moment nobody is agreeing on. For the most part, the majority of Palestinians do not believe in non-violence and in the survey that I talked about among the delegates to the congress, two-thirds told us that violence so far has been helpful in achieving Palestinian national rights in ways that negotiations could not. In other words, if indeed Abu Mazen’s message filters down to Fatah’s rank and file, violence could not be precluded. Where to go from here then? To answer Toni’s question, what do we need to do? Sorry, Toni, I don’t have time to tell you. I would certainly want the administration to go permanent status and define the borders of the Palestinian state as fast as possible but to be honest, I’m as pessimistic about the administration as Abu Mazen is. Thank you. Toni Verstandig:  Khalil, thank you very much. It was extraordinarily thoughtful and provocative. Let me ask Daniel Levy to please come up and offer the Israeli perspective. Daniel Levy: I might disappoint you on that. How about if I disappoint you on giving the Israeli perspective but I make you happy on the timing? I think that’s probably a deal you’d accept. Thank you, Toni, and the Middle East Institute. What I have been asked to do is look at the Israeli domestic realities and then put that into the bigger picture. I will try and do that for you without telling you too much that you know already and without intensifying the suspense that we were left in by Khalil at the end of his tremendous tour de force there. The divided nature of the Israeli polity, the fact that Israel is into its 32nd government now – and we are only into our 62nd year of existence and independence – is probably well known to most of this audience. The first point I would like to make is to try and give you an appreciation of how structural I think that has become. I would argue that a constellation of circumstances in the mid-1990s led to a situation where we have a deeply dysfunctional Israeli polity. There were things going on in Israeli society – the wave of immigration from the former Soviet Union, the increasing national identity and ability to articulate a different vision being assumed by the Palestinian Arab community inside Israel, the rise of Safadi orthodoxism – and when that was married to a change in Israel’s electoral system, I think we basically broke Israel as a functioning parliamentary democracy. Israel moved to a system of two ballots. We did it in 1996 and then again in 1999. That encouraged this proliferation of small parties and I don’t think we ever managed to put that back in the bottle again. Today the Israeli polity that you are dealing with is a parliamentary democracy which does not have an executive branch, as you have here; every day the Israeli prime minister is dependent on a majority of 61 in the 120-member Knesset. It’s not that you are elected for four years and you can plan those four years and maybe you have to worry about a filibuster-proof Senate majority, maybe you have to worry about Blue Dog Democrats – no. In Israel’s 120-member Knesset there are twelve different parties represented. The largest single party, which is not the governing party, is less than a quarter of the seats. Less than half of Benjamin Netanyahu’s coalition is drawn from his own party and the twenty-seven that are from his own party are far from guaranteed as supporters of any party line that he might want to define. Governmental reform has become a major issue in Israel against that backdrop. So the first point I would make is that you do not have a four-year planning horizon as an Israeli prime minister. If it is a four-month or four-week planning horizon, then luxury is entering your governmental management equation. What the Vinograd report into the Lebanon war of 2006 – you will remember there was a committee established afterwards, the Vinograd committee – one of the things they found was what a lack of inter-agency process we have in Israel. You don’t have strong institutions bringing long-term strategic planning to the governmental table. The only agency in the Israeli system that has that capacity is the Israel Defense Forces (IDF) and serious military people will be the first ones to tell you that if they are the only body in a decision-making structure that is bringing long-term planning to the table, you are going to have a deeply imbalanced decision-making process. The problem is – because you can have an Italian political reality. People basically say politics is not going to deliver for me, I’m going to get on with my own life; hopefully politics won’t get too much in the way. But an Italian political reality combined with a Middle Eastern geostrategic reality is not a recipe for a happy outcome. Obviously this is not to say that Israel does not have its own responsibilities, is not responsible for its own situation, etc. But I think it poses a serious question if one is imagining a process where the drive to resolve this process is going to come from the parties themselves – in this respect, from the Israeli political system. That poses real challenges to an American administration which defines resolving this conflict in its own national security interests. By the way, of course, the particular coalition that Prime Minister Netanyahu has chosen was his own decision. That was his choice. It was his choice not to have Kadima in the coalition. Kadima, let by Tzipi Livni, set two benchmarks essentially: one was a statement of seriousness regarding the peace process, the other was a rotation (in other words, Tzipi would be prime minister part of the time). The extent to which Livni was committed to the rotation was never put to the test because Netanyahu never gave a satisfactory answer on the first question of a serious peace process. Beyond that there are three main challenges, domestic politically speaking. One is that the ideological constituency represented by the settlers is not something to be taken lightly. There are 500,000 Israelis living over the green line; 300,000 of those are in the West Bank. That begins to take on the dimensions of a serious constituency, certainly when one bears in mind their supporters from inside the green line. Not all of the settlers are ideologically predisposed toward a Greater Israel or to a theological vision but I would argue that any Israeli prime minister serious about de-occupation and two states does have good reason to lie awake at night worried about a political showdown with the settlers and their supporters. The second is what I would call a secure-ocrat mentality that I believe is now pervasive in the Israeli establishment after so many years of peace processing. That secure-ocrat mentality is one that has got used to the luxury of looking at the territories as Israel’s outer envelope of security and has got used to the luxury of Israeli freedom of operation in those territories – even in the context, by the way, of withdrawing from Gaza. That applies still, I’d say, basically to Gaza and to the West Bank. It is going to be difficult to wean the security establishment and the elites that take their lead from the security establishment off of that but it does mean that in fact when Prime Minister Netanyahu puts security arrangements front and center of his arguments – as he did at Bar Ilan, as he did again yesterday at the CJF general assembly here in Washington – that matters. I think there are answers to that that may actually make this easier to do but this is saying something about how the Israeli system looks at this. The third thing is, to my mind, the system of incentives and disincentives in the short term is always stacked in favor of the disincentives, is always stacked against the incentives for doing anything now. Kadima leaders and even occasionally now Prime Minister Netanyahu – and Rahm Emanuel today at that same conference in his speech – can come with the argument that if in the long term, if in the future, one wants a state that is a national home to the Jewish people but still is a democracy, that Israel cannot continue with the control of the Palestinians and needs a two-state solution – one can make that argument but what does it translate into tomorrow? What does it translate into when one has to confront one’s coalition, maintain one’s 61 votes? Are Ministers Benjamin Begin and Bougie Ya’alon going to stay in the government or not? As long as they are happy in the government – if you want to look for one indicator of whether we are ever moving seriously in a peace effort, as soon as those two make noises that they are leaving the government, you can start to think that we are being serious. But if you look at what is happening tomorrow, keeping your coalition together, etc., the system tends to be stacked against taking the big move – I would say because not enough incentives have been created for going forward and not enough disincentives have been created for maintaining the status quo. Especially when we found the magic formula – and it was a magic formula that kind of worked for both sides until last week, in a way, according to Khalil. The magic formula is the peace process. You express your fealty to the peace process, you say the magic words “two states” – everything on the ground is going in totally the opposite direction but as long as we maintain the peace process, as long as we say two states, somehow it is all going to be all right eventually. For the PA this has meant until now at least an exclusively negotiation-centric approach to delivering Palestinian independence and statehood. For the donor community it has meant that fifteen years into funding the PA, we still pretend that this is a state-building exercise while no state is on the horizon – not because necessarily of what the PA is doing or not doing (certainly not in the current leadership of Salam Fayyad) but because of the reality on the ground. So what in fact is being funded is an occupation maintenance exercise. But as long as you call it by its magic name of peace process, it’s okay. The reality on the ground is that in 1993 there were 111,000 Israelis living in the West Bank. That number today according to IDF official statistics is over 300,000. By the way, the settler numbers are just the tip of the iceberg; it is the entrenchment of a reality on the ground – so-called “fabric of life” roads, etc. The belief of the people on both sides – it is not that in a poll you won’t get the majority still saying yes to a two-state formula that looks like Geneva and the Clinton parameters. But the belief of the people is that this is not going to happen, certainly not any time soon. The reality is also that at least what we saw in Gaza in the new year is that each round of clashes could become more and more ugly and devastating and deadly. We have actually seen the de-industrialization of Gaza, with devastating consequences for a place full of such a young population. Were it not for the work of UNRWA and others, you would not even have the basic maintenance of social structures in Gaza that you have today. Yet the basic premise has not changed. I am fascinated to see the trajectory of developments on the Palestinian side and that is certainly one of the wild cards there today. I don’t think it dates from the entry into government of Benjamin Netanyahu. I actually think we were stuck and we were not going anywhere long before that. If Mahmoud Abbas has changed what he said to Lally Weymouth a few months ago and now he is saying actually it was very serious with Olmert, whereas previously he said it was not so serious – I actually think it was a peace process that was not delivering. I don’t think – and I’m going to be blunt – I don’t think we have seen a strategic plan coming out of the Fatah-led PLO either. If indeed these questions of what would a turn to a one-state option or a turn to unilateralism look like, and we are still so in the beginning of thinking that through from a Palestinian perspective, then that says something about how locked into a formula that was not working the Palestinian leadership became over the years. I think the tension was visible many years ago – the tension between being a PLO dedicated to liberation from occupation and being a Palestinian Authority dedicated to cooperating with your occupier on a day-to-day – and how do you square that struggle? I don’t think you could over such a long period of time. So where does that leave us today? Benjamin Netanyahu’s offer of settlement restraint – and I hesitate to say this given that Dan Kurtzer will be speaking after me and he certainly knows this better probably than any of us – but I would argue that it is unprecedented. It meets the technical definition of unprecedented: it has not happened before. There has not been an Israeli government that defined which units it was going to continue building, not beyond those units. However if one were to continue building 3,000 housing units, that is more or less an annual average of building in the territories. Of course East Jerusalem is excluded. So – unprecedented. It is true that there has not been a precondition before – and by the way, this administration also did not make it a precondition, that is a misreading of what the administration said. There has not been a precondition in the last 15-16 years of negotiations that, first of all, settlements are frozen before negotiations can take place. But even if both of those are true, after sixteen years they are not enough. It doesn’t matter. The reality on the ground in 2009 is not what it was in 1994. There is a clause in Oslo, in the first agreement, that says neither side shall prejudice final status talks by their actions on the ground. I think by now the settlement expansion probably qualifies as in some way prejudicial. So where does this leave an American administration that does deserve credit, as Toni mentioned? First of all, and for me this is the key, this is an administration that has defined solving this issue and resolving this conflict as an American national security interest. This is not a favor to Israeli friends or Palestinian friends. When General Jones spoke last week at the J Street conference he said: If there is one thing that can have a positive knock-on effect to everything else we are trying to do, if I could do one thing, it would be resolve this. An administration that has made this a priority, an administration that has engaged early – I would argue that all those are positive things and I even think you can have a few months. When you engage on this from day one, not in year seven or year eight but from day one, you can reach an impasse in month ten and there is still time for a course correction. So all these voices of woe are we and gloom and doom, I think, are just a little bit premature. But it is time for a course correction. There have been strategic reviews in a number of foreign policy arenas and I think this needs one as well. The administration inherited a peace process that was fundamentally broken. Just by doing it better you are not going to fix it. Confidence-building measures, leaving the sides to bilateral negotiations, gradualism – all these things have been tried for sixteen years; I think the jury is in. The sell-by date on Oslo expired in 1999, ten years ago. So I close by saying this. I don’t think we have much time to waste, especially in the de-stabilization scenario that Khalil presented, but I do think there is a need for a re-think. I don’t think the Palestinians are going to negotiate their de-occupation with an Israeli side which is at best ambivalent about whether it is actually up for the task of de-occupation. I think it is going to take the creation of a disincentive and incentive structure from the outside, leadership from the outside, including addressing some of Israel’s legitimate concerns, including Israel’s legitimate security concerns, by third-party answers – not answers that a Palestinian people under occupation can provide while still in that predicament. I have not had a chance to address Syria and Lebanon or the extent to which I think this is very relevant in a new Iran strategy, but I hope we will touch on those, and certainly the next speakers will. But I would end by saying it’s way too early to give up on this administration but if we keep going as we are then I will think again about that. Toni Verstandig:  Daniel, thank you very much. Murhaf, if you could come up and broaden our perspective to Syria. We have been given a very interesting and rich menu of ideas and some very provocative thoughts on both the Palestinian and Israeli fronts. Murhaf, over to you. Murhaf Jouejati:  Thank you very much, Toni. I am very honored to be here and I thank the Middle East Institute. The bad news is I am far less eloquent than the two previous panelists. The good news is I am going to be much more brief. I think the way the Middle East Institute approached this, to talk about domestic obstacles, truly is far more productive than the alternative, which is to lay blame here and there – although I am going to have to engage in that (I cannot change my skin). I take issue, for example, with Toni’s question at the outset of when will Syria take steps toward peace. I also take issue with a sentence in the letter of invitation for me to speak here by Ambassador Chamberlin, who asks whether a rejectionist Syrian regime is ready to make a paradigm shift. Rejectionist? Syria crossed the distance from seeking the liberation of Palestine to the containment of Israel within the 1967 boundaries, a de facto recognition of Israel within the 1967 boundaries. Syria crossed the distance from seeking non-belligerence with Israel to seeking “normal peaceful relations based on the UN land for peace resolutions.” Syria was the first to accept the US invitation to the Madrid conference which gave rise to the Middle East peace process, which itself paved the way for the Declaration of Principles between Palestinians and Israelis and a peace treaty between Jordan and Israel. Syria negotiated directly with a number of consecutive Israeli governments from 1991 to 2003, including the governments of Rabin, Peres, Netanyahu and Barak. If the talks failed in March 2000, it is because former Prime Minister Barak – according to the memoirs of former President Bill Clinton, Prime Minister Barak at the time got cold feet by offering Syria less than a total withdrawal on the Golan. By contrast, Syria acquiesced to Israel’s three requirements for peace: normalization of relations, the establishment of a mutual security regime, and a joint water-sharing mechanism. Despite the failure in the talks later the administration of Bashar Al-Assad sought and later obtained a resumption of talks with Israel, albeit indirectly through Turkey as the mediator. On the eve of the fifth round of talks, which apparently all of them and especially the fourth were promising talks, Israel went to war in Gaza and the talks were interrupted. So given this history, I can hardly call Syria rejectionist. What will it take for Syria to go back to the negotiating table? An Israeli commitment to withdrawal to the June 4th lines and to resume the talks from the point at which they had ended. Let us for the sake of argument assume that Israeli leaders today commit to withdrawing their forces from the Golan to the June 4th lines. Would Syria accept peace? Is there no internal opposition? Under the days of Hafez Al-Assad, there was near unanimity that Syria should not make peace with Israel unless Israel withdraws to the June 4th lines. I think this is very much the case today. During the Hafez Al-Assad era the institution of the Ba’ath was on board and to send the message, especially to the Americans, Hafez Al-Assad at one time sent the assistant secretary general of the Ba’ath Party (Abdullah Akhmar) to the United States, ostensibly to visit with expatriates and so on. The institution of the army also is on board and we remember here when the late President Al-Assad had dispatched Lieutenant General Shabi, the former chief of staff of the army, to have technical talks with then Chief of Staff Barak. The business community certainly then and now is on board for peace but again, on the assumption that this is the June 4th lines of 1967. The only group that I was able to detect in Syria that is ambivalent about this is the Muslim Brotherhood. When you ask them they say if they are in power they will not oppose the trend for peace in the Middle East but as an opposition movement they accuse the Al-Assad regime of wanting to resume peace talks. This is of course political opportunism at its best. Assuming that Israeli leadership commit to that withdrawal to the June 4th lines, will Bashar Al-Assad reduce ties to Iran? I have been here before at the Middle East Institute – I believe it was an annual conference as well – where I had argued that yes, the Syrian-Iranian strategic alliance will be scaled down. I had pointed out to many fissures in the Syrian-Iranian relationship, which I call a marriage of convenience (and if I am going to be even more blunt I would call a muta marriage). Although Syria is the junior partner in this alliance, Syria did participate in the Annapolis conference in 2007 despite Iranian objections. Syria did hold indirect talks with Israel through Turkey despite Iranian objections. Syria and Iran view Iraq through a different lens. There is more of a Syrian-Saudi accord on Yemen than there is with Iran. And, the recent love affair between Syria and Turkey, including intelligence sharing and joint military exercises and so on. How about ties to Hezbollah and Hamas? I argue that that too will be scaled down because Hezbollah and Hamas, I believe, rightly or wrongly, serve as instruments of Syrian power. This is not to say that Hezbollah and Hamas are puppets of the Syrian regime – they are not. But if there is peace between Syria and Israel there is no need to have a Hezbollah and Hamas for Syria. This is not just a hypothetical. I go by the precedent in which at the time under Hafez Al-Assad, former Vice President Abdul Khalim Haddam, who was in charge of the Palestinian portfolio when the peace talks with Israel were going well, had gathered the guerrilla leaders in his office and asked them to go look for another job. At any rate, both Iran and Hezbollah understand the pressures that Syria is up against and I don’t believe they are overly concerned because they are convinced that Israel will not compromise. Third, assuming that Israeli leaders commit to this withdrawal to June 4th lines, will Syria sign a peace accord before Palestinians? That truly is a very difficult question. It is a question that is being debated in Damascus, at least when I was there something like a month ago. Syria is embedded in two institutions: Arab nationalism and sovereignty. As in all institutions, each one of these generates a particular role. In the first Syria is expected to enact the defense of Arab rights; in the second Syria is expected to defend its own interests. Historically Arab nationalism had been a major predictor of Syria’s external action but Arab nationalism has declined and statism has inclined. Still, despite the weakening of the first and the strengthening of the second, Syria faces a role conflict. Will Damascus opt to defend Syria’s narrow interests or will it defend broader Arab interests? Will Damascus opt for raison des nations or for raison d’état? One indication that Syria’s interests are first and foremost is again provided by precedence. Although we will never know if Hafez Al-Assad would have accepted to sign before the Palestinians had he been given all the Golan, we do know that he viewed the secret Oslo talks as a stab in the back. It is since then that he had delinked the two tracks, saying that the two are independent of one another and one can go faster than the other. Then we have as evidence all those things that Hafez Al-Assad accepted: total peace for total withdrawal, normalization, mutual security regime, water sharing. I don’t think Bashar Al-Assad will ask for more than his father did. Another indication that Syria is first and foremost is the economic paradigm shift that Syria is currently undergoing. Syria wants to be integrated into the world market economy and Syria now has private banks and private insurance companies. It has a stock exchange. It has investment and brokerage firms and private universities. Sheraton and Four Seasons hotels are in Syria now and so is Deloitte & Touche, Ernst & Young and KPMG. So is Kentucky Fried Chicken and Dunkin Donuts. The list goes on. Indeed, Syria is changing course. The distance Syria crossed from the consumption of the Ba’athi variant of radical Arab nationalism to the consumption of Dunkin Donuts is impressive. This may lead the observer to conclude tentatively that if Israel commits to withdrawal to the June 4th lines, Syria will sign before the Palestinians. But I don’t believe things are as straightforward as this. Again, Arabism, though it is declining and a declining predictor of Syria’s behavior, it continues to be constraining. Signing a peace treaty without Palestinians compromises Bashar Al-Assad’s position on the Arab street. The big question is, will Bashar Al-Assad trade Syria’s role as the champion of Arabism in exchange for the Golan? Again, this was the debate and to many it seemed unimaginable. What makes me more cautious about this conclusion of “Syria first” is when I interviewed a very senior official, whom I will not name, he answered: We cannot do what our people cannot imagine. So there must be some formula to be worked out, one in which peace between Syria and Israel is accompanied by at least some real progress on the Palestinian-Israeli track. In the final analysis what we can say for sure is that peace between Syria and Israel is not impossible but that Middle East peace without the Palestinians is impossible. That is why I think if there is going to be peace in the Middle East it is going to have to have a comprehensive settlement. Thank you. Toni Verstandig:  Murhaf, thank you very much. Now Daniel, you have the pleasure of wrapping up all the threads and introducing the new thinking to help bring us to hopefully a more positive outcome and catalyst for some new ideas. Daniel Kurtzer:  Thanks. Toni has asked me to kind of reset the table. What I want to do is exactly that but before doing so share perhaps five introductory observations with you, and with that then get to the table and try to reset our policy agenda. First observation, we are hearing from some pundits around town in the newspapers that perhaps because things are going badly we ought to walk away from the peace process. You have heard today from our panelists, with whom I agree fully, that the idea of walking away from the peace process simply misses the point. If indeed peace in the Middle East between Arabs and Israelis is a United States national interest, then one does not walk away from a policy problem. The second observation I would make is one fixes a policy problem. The reality is that the first ten months of the Obama administration, which began so interestingly and productively, have gone astray with regard to our Middle East peace process policy. Rather than thinking about walking away from the peacemaking process, one ought to focus attention on fixing the policy and trying to make it work. A third observation is that one hears around town with increasing frequency – including on this panel – that maybe it is time to experiment with a one-state solution. In other words, the idea that the two-state solution may have run its course. The reality is that for about eighty years we have known that there is only one outcome that is going to work if the Arab-Israeli conflict is going to be resolved: partition, a two-state solution. So rather than Abu Mazen experimenting with a one-state solution, rather than Bibi Netanyahu experimenting with a one-state solution which would effectively result from a continuation of settlement activity, one ought to rededicate oneself to the idea of a two-state solution and not experiment with ideas that have been proved not to work in the past. The fourth introductory comment would be that our panel today was asked to focus a little bit on domestic politics and they are certainly important. But I have to tell you, after too many years in government and a few years out of government, domestic politics is not my problem when it comes to somebody else’s polity. For American policymakers, our domestic politics are important. In this respect I would argue that the Obama administration has not only the tools to do this job but also has the necessary political support. Some 78 percent of the American Jewish community voted for Barack Obama last year and a large part of that community support remains the president’s. The president has the kind of domestic support he needs to embark on an ambitious and aggressive peace process policy. You heard today very – I would say even brilliant expositions of the politics within the Palestinian community and within Israel. It is interesting – now as an academic, I find it fascinating in fact. But as a policymaker I want to leave those domestic politics to their leaders. Let them figure out how to deal with their domestic politics. If they are leaders, they will lead. So rather than predicate our policies on the weaknesses or strengths or successes or failures of someone else’s domestic policies, we need to fix our policies, predicated on our domestic support that the American people have given to this administration, and then lay it out. Let the two sides – in this case the Israelis and Palestinians – figure out to deal with their own domestic issues and how to bring about the kind of support for the policies that we would like them to support, or they may choose not to support it. But if they choose not to support it they have to know there are going to be consequences in terms of their relations with us and others. So the issue of domestic politics – interesting, analytically important, but for policymakers I would suggest that we focus on the policy rather than on the domestic constraints to that policy. The fifth introductory comment relates to a panel that was held earlier today. Maybe it is appropriate that I speak last formally to bring two parts of this program together. It was a very good panel this morning on Iran, US policy choices and so forth. In the Arab-Israeli context, in the past sixteen years there have been two prescient leaders who understood the nature of the Iranian threat and who therefore wanted to do something about it. When Yitzhak Rabin came to Kennebunkport, Maine, in 1992, right after his election, to speak to then President George H.W. Bush, Rabin’s basic message was: we need a comprehensive Middle East settlement not because I’m a member of Peace Now – we know that Rabin was not – but rather because the issue facing Israel as a strategic threat was Iran over the horizon. Rabin understood that the absence of peace was an albatross around Israel’s neck. It was a barrier to coming up with a strategic set of options to deal with the upcoming Iranian threat. Fast-forward the clock just a few years and both the King of Jordan and the King of Saudi Arabia understood the exact same thing, because if you want to understand the origins of the Arab peace initiative it is not that people woke up one morning and said, well, really we’d like to be Zionists. What the Arab world understood was that the absence of peace and a predisposition to fight a battle of 1948 rather than to deal with the consequences of 1967, that that predisposition was holding back the Arab world from dealing with the upcoming threat of Iran. This morning they talked about there’s no such thing as Iranian hegemony – we can talk about that in the question and answer period. The point is that both Israeli leaders and Arab leaders understood that this peace process is past due to be resolved, not just because it can be resolved – as Khalil was suggesting with his polling and as we know from polling in the Israeli public opinion – but because the strategic threats in this region have nothing to do with Arab aggression against Israel or Israeli aggression against Arabs. They have to do with factors now that Arabs and Israelis have to deal with almost in concert, an issue that was raised in this morning’s panel. Therefore, it is important to reset the table and it is important to fix the policy. Let me suggest a number of ways to do that. While some of the words I use are not as creatively disguised as Daniel’s suggestion about Hillary Clinton’s use of some words, while the words I use may sound familiar, think about this as a battle which takes place across a wide front. There is no one issue that needs to be resolved here. There are seven or eight issues which a serious policy approach has to deal with simultaneously. First of all, negotiations. This is not a conflict in which there will be a dictated settlement from the outside but it is also not a conflict in which negotiations can start over from the beginning every time we get the parties to the table. So if we think about getting the parties to the table for negotiations, the United States has the role of framing the issues to be negotiated, of putting forth ideas that we know the parties talked about. Khalil mentioned Abu Mazen’s admission of how close negotiations almost produced an agreement with Olmert. If they were that close, then don’t let the parties start any further apart. Start them that close and then constantly monitor those negotiations so that the United States can continue to narrow the parameters within which the two sides would talk. In other words, negotiations are critical but not open-ended negotiations; not negotiations without preconditions. There have to be preconditions because they have talked now for fifteen years and they have narrowed the areas about which they are talking. Second is this idea of a proactive and interventionist US role. Had we never done this in our own history one could argue that perhaps we are not up to it. But as a number of very well written and well analyzed books have suggested, we have done this in the past. We did it in the 1970s with step-by-step diplomacy, we did it at the end of the 1970s with the Egyptian-Israeli treaty, we did it in the early 1990s with the Madrid peace conference. The United States knows how to do this. The fact that we have not done it well for the last fifteen years suggests that we need to study why. Scott Lasensky and I suggested some ideas in a book we published last year which was in fact a mini-manual for trying to get it right. The point is that an active, aggressive, interventionist US role – not substituting for the responsibilities of the parties to solve their problem but helping them do so – has worked in the past and it can work again. Third, addressing the narrative. This is an issue that my friend Rob Malley has raised and I agree with him fully. We have conducted a peace process now for many years in which two of the most critical constituencies have been left out entirely from the discussion: on the Palestinian side, the refugees; on the Israeli side (as Daniel indicated today) the settlers, who are an important constituency whose concerns have to be dealt with by an Israeli government in the context of peacemaking. This is not an issue in which the United States can play a primary role at the outset but we can encourage the two communities to start internal dialogues in which they can begin to work through these issues themselves. There may be refugees out there who believe that the key that they are holding to their old home in Palestine will one day be used. They are going to have to find a way to deal with it because it is probably not going to happen. There may be settlers who believe that every house that settlers built since 1967 will remain under the jurisdiction of the state of Israel. They are going to have to find a way also to revise their thinking. So the first thing that needs to be done is an internal discussion within these two communities that brings these constituencies into the peace process so that when the parties begin to negotiate refugee matters or the dismantlement of settlements, you won’t have two communities that have been watching this from the outside only with an attitude toward opposition rather than accommodation. Fourth, building support structures. You have had this Arab peace initiative on the table since even before 2002 but it was formally adopted at the Arab summit in 2002. It was readopted at the Arab summit in 2007 and nothing has happened with it. The Arab states also have responsibilities here because they have an initiative out there which did not include Israel in the parties to be talked to about the initiative. If you read the last paragraph of the Arab initiative, it is extraordinary: the Arabs want to talk to everybody in the world about the initiative except the state of Israel. So the Arabs have to figure out a way to make this initiative discussable with Israel, but Israel, the United States and the rest of the international community also have to figure out how to deal with what is in fact a cosmic change in Arab policy. The Arab peace initiative, as I suggested earlier, represents a fundamental shift in Arab policy from focusing on the results of 1948 to focusing on the results of 1967, and the results of 1967 are resolvable. We are not sure that focusing on the results of 1948 would be resolvable but the Arab world has moved beyond 1948 and is focused on 1967. So we have to find a way to build this Arab peace initiative and the safety net and support structure that it provides to Palestinians into the process of peacemaking. Fifth, Palestinian state-building. My mentor in graduate school wrote perhaps the seminal work on this fifty-nine years ago. J.C. Hurwitz wrote a book called “The Struggle for Palestine” in which he said that one of the most important distinctions between the Zionist movement and the Palestinian national movement during the mandate period was that the Zionists got ready to be a state and the Palestinians did not. As Rashid Khalidi has told us, we know why the Palestinians didn’t – because they didn’t accept the very essence of the mandate and therefore could not build the institutions called for by the mandate because they rejected the idea of the mandate. So be it for the mandate, but fifty-nine years later there still are no credible institutions of Palestinian society that would make that state ready for statehood. Thankfully today Salam Fayyad has come along and said: I’m going to make sure we’re ready. So we now have a key to unlock this door that has been closed not just for fifty-nine years since the book was written, but for the seventy-nine years since this problem developed at the outset. That requires more resources and the United States can afford those resources, as can Europe. It requires more emphasis to the mission of General Dayton, referred to by Khalil with respect to the quite exhilarating performance of Palestinian security services who are now loyal to the Palestinian Authority and not to one of its constituent parts. But these are resolvable problems. These are doable issues. So our fifth issue is to build institutions, and now we can do it within the framework of a Palestinian initiative – the initiative of Prime Minister Fayyad. Number six, let’s not forget that behaviors need to change. The Obama administration did not simply decide to try to get Israel to freeze settlements because it thought it was a good idea. The Obama administration started out on its track of policy with the idea of creating a better atmosphere in which all these other things could then take place. The problem however was that the policy became a roadblock in and of itself. Once the Obama administration was not ready to go to the mat – in other words to go all the way for a settlements freeze – in effect Netanyahu could go home claiming “victory” when in fact victory meant nothing, because there was no peace process resulting from it. So the United States must continue to press Israel to freeze settlements. I argue with anyone in this room who says that settlements cannot be totally frozen – they can be totally frozen. Any government in Israel that has allowed settlement construction, that has licensed it, that has permitted settlers to build can also tell settlers that it has changed its policy. If there are legal issues, or financial issues that have to be unwound as a result of this – that is for the Israeli government to work out. Settlements must stop. But the effort to get settlements stopped cannot be used as a barrier to achieve all these other purposes. On the Palestinian side institutions must be built, further efforts must be undertaken to root out whatever infrastructure of terrorism still exists. The effort last May in Qalqilya is a shining star in Palestinian history because it was a moment in which the Palestinian security forces – not to protect Israel but to protect the PA – went after a group of bad people. They went into a building and some people got killed, including among the security forces. That kind of effort must continue because it is in the Palestinian interest for there to be one gun, one authority and one voice when it comes to law and order. So these behaviors which are so detrimental to the success of the peace process must change and the effort to change those behaviors must continue even as we do all these other issues. But none of these should become a barrier to progress on the other fronts. Finally, I would note there is a thought out there: let’s try to do borders first. In other words, let’s try to find the shape of a Palestinian state and then perhaps once that shape is known it will help resolve part of the settlements issue – because whatever is outside those borders presumably then Israel would be permitted to build – and would also give some sense for Palestinians of what it is that they are negotiating about. I happen to subscribe to the idea that a borders first negotiation is a good idea but with a number of principles that have to be attached to it. With that, I would conclude. Number one, that a borders territory agreement would reflect the equivalent of 100 percent of the territory of 1967. It may not be inch by inch the same but it will add up to 100 percent of the territory that was occupied in 1967. Number two, that in reaching this 100 percent outcome there will be territorial swaps of one-to-one ratio in both size and quality. Number three, that there will be an equitable methodology for sharing natural resources (which do not know borders). Water and minerals and the like will be done equitably and fairly. Number four, that the discussions on territory should, first, dislocate as few settlers as possible – which is doable if you look at a map; second, avoid as much as possible impacting on Palestinian daily life; third, ensure the contiguity and political/economic viability of the Palestinian state that is going to emerge; and fourth, not include the idea of population swaps, which I think is a pernicious idea that has been raised by some. With borders first negotiations, there have to be at least three simultaneous, additional talks held. Number one is on Jerusalem because if you’re going to draw a border, it’s going to include Jerusalem and therefore you cannot ignore the Jerusalem issue until the end of the negotiating process. But there are ideas to work through the Jerusalem issue. In 2000 President Clinton came up with the Clinton parameters. Less than a year ago I co-published an article in Foreign Affairs with Ambassador Michael Bell of Canada that resulted from a study we had undertaken on a special regime for the Old City. Maybe that’s not the idea that is going to win out in the end but the point is that Jerusalem is not an unresolvable problem and therefore negotiations on Jerusalem should be conducted simultaneously with the discussions on borders. Number two, there have to be discussions on the issue of safe passage. We have talked around and about the issue of Gaza and Hamas. The most immediate question is, how do you relink these two entities? There has to be a discussion on the issue of safe passage, which is part and parcel of Oslo. Number three, there are territorial water issues related to the Dead Sea which most of us do not pay attention to, but the Dead Sea potentially has some of the richest mineral resources anywhere in that region. If an agreement can be reached on both the allocation of rights and then the exploitation of those minerals, it can go a long way to solve some of the financial issues that will result from these negotiations. So that is a reset table. I did not include Syria. I have a one-line response on Syria which is, why don’t we get the parties back to the negotiating table? Toni Verstandig:  Let me thank all of our panelists. I think the audience will have to agree we were given a very rich overview of the current Palestinian-Israeli situation and Dan has put on the table a very interesting set of ideas on resetting the table. I am going to take the privilege of the chair and bundle a couple of questions. Let’s start with the settlements. All of the panelists addressed the issue of settlements and I would like each of our panelists – we received many questions on settlements, ranging from what will it take for Obama to pressure Israel to freeze settlements; are there implications for his reelection? But I want to take a couple of questions that speak to the issue of what are the incentives and disincentives that might be offered to put on the table to address the issue of settlements? Dan, do you want to begin? I’d like each of our panelists, if they would, address the question please. Daniel Kurtzer:  We had experience with this issue going back to 1989. The issue first arose between the United States and Israel on whether or not certain forms of US aid should be permitted to be used at that time for settlements to support the immigration of Soviet Jews. The United States, after a prolonged period of some crisis in bilateral relations, developed mechanisms for ensuring that our money would not only be used for settlements but that we could monitor the fungibility of money so that Israel would not put US aid in one pocket and take money out of another pocket to pay for the settlements. We have never really enforced that agreement as tightly as we should. In the 1990s, as the study that I mentioned earlier indicated, there was such interest on the part of the Clinton administration to move forward in the peace process that there was very often a blind eye turned to settlement activity in the belief that if you reached an outcome of peace, the settlement issue would go away. Well, we did not reach the outcome and the settlement issue simply intensified. During the Bush administration not only did we turn a similar blind eye but in fact President Bush in 2004 allowed as part of American policy the idea that some heavily populated Israeli areas in the West Bank would be supported by the United States for retention by Israel, which Israel then interpreted as support for its retention of settlement blocks and then unilaterally intensified building in those blocks even though there had been no agreement on what the president had meant. So I think in the first instance we ought to enforce what we already have on the books, and that is that no US resources of any sort should be allowed beyond the green line and that it be monitored very carefully and a deduction be made. The reality is that if we did that, the numbers are going to be quite substantial. We have a sense of what the Israeli budget is beyond the green line and we know what we provide in aid. I think if we started monitoring and then implementing what we already have on the books without even thinking about new methods of accountability, it would send a rather important message to Israel that it probably would be wise to stop that activity rather than start losing the assistance that it needs. Murhaf Jouejati:  For Syria of course, the view is that all settlements are illegal. It is not a question simply of freezing the expansion of settlements, all settlements are illegal. But what I would like to say here is that I think the Syrian leadership along with public opinion – and that I think is true throughout the Arab world – was very discouraged by the fact that the freeze that President Obama called for and which was violated, found no consequences. Ambassador Kurtzer talked about consequences if somebody violates this or that; there have not been any consequences. So I fear that the Obama administration may have lost a lot of political points on this one. Daniel Levy:  First of all, I would endorse that there should be an engagement with the groups that one is not engaging with, including settlers. One can divide that constituency and that will be an important part of getting a two-state deal. I would say that one takes as a point of departure what Ambassador Kurtzer just said. US support for Israel, which I am a big supporter of, should draw the red line at the green line. One should come up with as watertight a policy as possible – including when the New York Mets facility is being used to host a fundraiser for the Hebron Fund. Those kinds of organizations should not be allowed to raise money on a tax-deductible charitable basis in the United States. I’d get that menu in place of what it means to draw a red line at the green line, but I would say this: there should be consequences but I would go to the mats. On a settlement freeze there cannot be any flexibility. Anything beyond the green line is of the same status. When it comes to a border, as Dan suggested, you can have border swaps. You can have a one-to-one land exchange. So I would go to the mats over the framing of an implementation plan for a two-state solution and not necessarily over settlements, because even if you got a freeze the settlements would still be there, the entire infrastructure would still be there. By the way, it is not just the US also. If Europe, in its association and free trade agreement with Israel, has a set of policies regarding rules of origin of products from the settlements not coming under that free trade regime, that should also be implemented. Khalil Shikaki:  I think there are two things that can be done. One, Dan referred to the 2004 Bush statement to Sharon on the settlement blocks, or how the Israelis interpreted facts on the ground. I think if the Obama administration is to state very clearly that any continued settlement buildup, which now the Obama administration says is illegitimate, cannot be counted as part of this American commitment – in other words, if Israelis decide to build more and more settlements today in violation of their commitments, this would put in question the commitment that was made in 2004. It would raise a question about the extent to which the US would be sympathetic to the idea of annexation of certain parts because of the facts on the ground. One can say that because of that commitment, Israel feels in order to expand the area it will annex, it can expand settlement buildup; so the US is in fact complicit in creating this environment. The second thing has to do with the scope. I think if Dan’s suggestion is to be taken seriously, about the administration coming up with an inventory of positions – since Camp David in fact, the administration already has answers from the parties with regard to various proposals submitted, from the Clinton parameters to the Annapolis. We know that Secretary Rice in her last few weeks in office documented the progress that was made between Abu Mazen and Olmert. If these are to be used by the administration to create a list of positions of agreement and disagreement, and present these to the parties – where the parties have already agreed, this should be the joint position of the three parties (the US, Israel and the Palestinians). The areas where there are still gaps, the US can – once the parties return to negotiations – provide bridging proposals if things are not moving forward. If that is to happen then the issue of settlement buildup can become a much easier issue to deal with. In the absence of this larger American undertaking, it becomes impossible, I believe, to move on the settlement question. Toni Verstandig:  Panelists, I want to thank you. We have been given a hard stop. The audience, I want to thank you for your participation. It was an enriching discussion. I apologize for not being able to entertain all of the questions but thank you very much for joining us today. Wendy Chamberlin:  Thank you very much. On behalf of the Middle East Institute and the Board of Governors, thank you all for being very patient. I know you have been crowded together all day today. I began this morning by asking you if you could fill out the card in your package that gives us suggestions for next year; I would remind you to do that before you leave and drop it off at the registration desk. Thank you so much, panelists. Also, before I leave, just one more minute, because I think it is very important to thank the mother of this conference, Kate Seelye, and the full staff of the Middle East Institute have been working on this conference and the dinner last night for months. A particular thank you to our interns who we really could not run the institute without. Thank you all very much.
About this Transcript: Assertions and opinions in this Transcript are solely those of the above-mentioned author(s) and do not necessarily reflect the views of the Middle East Institute, which expressly does not take positions on Middle East policy.   Speaker Details Dr. Khalil Shikaki is an Associate Professor Science and Senior Fellow at Brandeis University. Mr. Daniel Levy is Director of the Middle East Task Force at the New American Foundation and directs the Prospects for Peace Initiative at The Century Foundation. Dr. Murhaf Jouejati is Professor at the National Defense University and a Professorial Lecturer at the George Washington University. Ambassador Daniel Kurzer holds the S. Daniel Abraham Chair in Middle East Policy Studies at Princeton’s Woodrow Wilson School of Public and International Affairs. Ms. Toni Verstandig is Director of Middle East Programs at the Aspen Institute and Senior Policy Advisor at the Center for Middle East Peace and Economic Cooperation.