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The Palestinian Issue: Toward a Reality of Two States April 23, 2013

The purpose of this document is to present the main research findings of the team established by the Institute for National Security Studies, including recommendations on the preferred course of action regarding the Palestinian issue. The members of the team, headed by Gilead Sher, are Benedetta Berti, Gideon Biger, Shlomo Brom, Udi Dekel, Shlomo Gazit, Anat Kurz, Yael Lahav-Kurzion, and Yoram Schweitzer; assistants: Liran Ofek and Neil Segel.

I. Synopsis
The long term national interest of the State of Israel ensuring its future as the secure democratic nation state of the Jewish people depends on the territorial division of the area between the Jordan River and the Mediterranean Sea into two states. Therefore, at this critical juncture, Israel must adopt a proactive policy as soon as possible to delineate its borders so that they will reflect its foundations as expressed in the Declaration of Independence: a democratic state with a Jewish majority. The team analyzed the challenges, trends, and options vis--vis Israels policy toward the Palestinians. Its main conclusion is that in order to anchor its primary long term national interest a democratic Jewish state Israel, both through negotiations and independently, must separate itself from the Palestinians, and in coordination with the international community shape the borders of the country. At the same time, Israel must make internal preparations and engage in an internal dialogue to prepare the public and the national infrastructure for the gradual process of disengagement from the Palestinians. The independent option as a political strategy is intended primarily to promote two states for two peoples if negotiations with the Palestinians fail. Its advantages over the other political options were discussed at the Institutes conference last year. However, the teams conclusions are that it is preferable for the independent option to be a complementary part of the political process from the outset that will keep the initiative in Israels hands and will be implemented along several main tracks. One is based on an agreement, and includes negotiations for a long term political settlement; interim arrangements toward implementation of a negotiated permanent status agreement; and a multilateral regional dialogue. The other would be independent: an initiative of constructive, independent political measures (preferably with cooperation and coordination) that are not dependent on a complex process.

II. Background
In the current political reality and with the temporary lull in violence and terrorism, Israel and the Palestinians prefer to maintain the status quo rather than take the political risks and make the painful compromises necessary in a political agreement designed to resolve the conflict. However, in the meantime, the geopolitical conditions are changing in several senses. The concept of delegitimization of Israel is becoming increasingly prevalent in the international arena, and international recognition of a Palestinian state that does not come about as a result of an agreement is growing. The continued construction in the Jewish settlements is making the actual division of territory between two states less and less feasible. Fatah, the moderate Palestinian negotiating partner, is growing weaker domestically, at a time that the radicals in the Hamas leadership are growing stronger. The increasing strength of those who identify with political Islam in Arab countries is also worrisome.

III. Trends: An Analysis of the Israeli, Palestinian, and International Arenas


1. The Israeli arena Over the past two decades, Israeli governments have declared their support for the principle of two states for two peoples, and have worked some more, some less to implement it through negotiations or unilaterally. This strategic principle is directed at maintaining a Jewish majority under effective democratic governance and is intended to obstruct the risk to the Zionist vision inherent in a bi-national state, the demographic threat, and the Arab demands for the right of return. The team analyzed options that have been raised in the public political debate. The Jordanian option is that Jordan, against its will, regain responsibility for and control of the Palestinian population. However, this option relies on an agreement and does not solve the core issues, and as such, is not realistic. Naftali Bennetts stability initiative calls for full Israeli sovereignty to be extended over the Palestinian population and most of Area C, Palestinian functional autonomy in the areas under Palestinian Authority control, and Egyptian annexation of the Gaza Strip. This too appears to be impracticable from economic, military, and political perspectives. It is liable to lead to further isolation and international criticism of Israel, a deterioration in Israel's relations with Jordan and Egypt, a collapse of the Palestinian Authority, and the outbreak of violence in the West Bank and Gaza Strip. However, in the absence of a realistic political initiative, current reality could lead to the establishment of a bi-national state that lacks either the Jewish or the democratic element in its identity. This scenario of separation from the Palestinians as a result of a political agreement or an independent decision by Israel will require a massive evacuation of most settlements that are outside the large settlement blocs..

Polls indicate that there is consistent high public support in Israel for a two-state solution (about 69 percent), especially when presented as part of a comprehensive plan for a long term political settlement with the Palestinians.1 2. The Palestinian arena The Weakening of Fatah The Palestinian Authority, at whose core is the Fatah movement, is currently experiencing a process of internal delegitimization and is growing weaker economically and governmentally. In the absence of a natural successor to President Mahmoud Abbas, the chaos that would occur following his expected departure could bring about the PAs collapse and lead to Israels once again having full responsibility for Judea and Samaria. It has become clear to the Palestinian public that attempts by the Palestinian leadership to score points in the international arena by means of unilateral measures, such as upgrading the status of the Palestinians to non-member state at the UN General Assembly, have not brought about a significant change in their situation. Nevertheless, Abu Mazen recently announced that he is giving three months at most to American efforts to restart the negotiations, and that if they are not successful he intends to return to the unilateral option. These developments make it easier for Fatahs political rival, Hamas, to contend that the option of armed resistance to Israel is best and to gain strength in the West Bank. Mixed Trends in Hamas Hamas is continuing its relationship with Iran, particularly on military issues and weapons smuggling. In addition, cooperation between Hamas and the Muslim Brotherhood in Egypt has intensified, the legitimacy accorded Hamas in the Arab arena has grown, and Qatars economic support for the organization has increased. The rapprochement between Egypt and Hamas has not led to a deterioration in Egypts attitude to Israel or to radicalization in Hamas. However, Egypts fear of opening its border with Gaza, the terrorists who are establishing themselves in Sinai, and the Egyptian interest in stopping weapons smuggling through the Sinai and closing the tunnels are a potential source of friction between Hamas and Cairo and between Egypt and Israel. The past year saw a change in the balance of power in the Hamas leadership, and the militant Gaza leadership has grown stronger. At the same time, it appears that Khaled Mashal, who recently returned to his position as the movements dominant leader, is working toward a rapprochement with Qatar, moving away from Syria and Iran, and moving toward an internal reconciliation with Fatah. This approach suggests the possibility of a pragmatic policy toward Israel as well.

Yehuda Ben Meir and Olena Bagno-Moldavsky, The Voice of the People: Israeli Public Opinion on National Security 2012 (Tel Aviv: Institute for National Security Studies, 2013), pp. 13, 69. 3

3. The Regional and International Arenas Egypt and Jordan The political deadlock on the Israeli-Palestinian track keeps the Arab-Israeli conflict on the regional and international agenda. The longer the political impasse continues, the greater the chances that the Israeli-Palestinian conflict will take a violent turn. An escalation could cause the Egyptian and Jordanian leadership to demand a further downgrading of relations with Israel, and perhaps even to withdraw partially from the treaties between the countries. Tension between Israel and Egypt, and even more, a blow to the peace treaty, would block Israels path to a positive relationship with Jordan and other states in the region. The United States and Europe In one of his speeches during his memorable visit to Israel in the third week of March, President Obama stated that peace is essential, just, and possible. He pointed out that peace is the only way to achieve true security for both parties and that it should be reached through negotiations that lead to two states for two peoples. The United States and the international community see the settlements as a main obstacle to peace and are severely critical of Israel in this regard. Moreover, increased tension between Israel on the one hand and Egypt and Jordan on the other, the lack of a political process with the Palestinians coupled with an escalation in tension, and a new round of Israeli-Palestinian violence are factors that will impede the ability of the United States to stabilize the Middle East and form a regional and Western coalition against Iran. Pressure is mounting in the European Union for sanctions and punitive measures against Israel in many areas, such as the economy and academia. If developments continue to move in the current direction, Israel could have difficulty rehabilitating its international standing and achieving understanding for its security needs as a result of increasing pressures. IV. Conclusion and Recommendations: A Combined Process that Keeps the Initiative in Israels Hands a. We propose as a new political option an integrative and proactive approach for cautious and gradual progress to separate from the Palestinians and shape the borders of the state. This option would keep the initiative in Israels hands and would be carried out simultaneously on several tracks. One would be based on an agreement, and would include negotiations for permanent status; interim arrangements toward implementation of a negotiated long term settlement; and a multilateral regional dialogue. The other would be an Israeli initiative to delineate the borders, preferably in cooperation and coordination with the Palestinian Authority. b. The main advantage of this approach is the chance that in the first stage, it will lead to improved management of the conflict, and in the second stage, it will

c. d. e.

f.

g.

h.

i.

j.

create a basis for negotiations with the Palestinians on a permanent settlement and a regional dialogue with other Middle East actors. The proposed formula is that any step that contributes to achieving two states and/or is agreed upon be carried out. All the components of this approach are parallel, are alternatives to each other, and complement each other. Israel must formulate an outline for a long term political settlement and propose it to the Palestinian Authority. The proposal must be based on existing official outlines: the Clinton parameters, the Roadmap, the offer by Prime Minister Ehud Olmert to Abu Mazen in 2008, and the Arab Peace Initiative. The proposal would also include elements giving Egypt and Jordan key security and political roles. Including Egypt and Jordan in the process would help Israel demand guarantees for peace in the Palestinian Authoritys areas (and in Gaza as well), progress toward implementation of the goals of the negotiations, and strengthen the relationship with the two countries. When the time comes, it would be appropriate to consider in permanent settlement negotiations creative territorial solutions that have not yet been discussed (territorial enclaves, Israeli autonomous regions in the territory of a Palestinian state, and even Palestinian citizenship to Israeli residents), while limiting the uprooting of settlements to the extent possible, and on the basis of exchange of territories or monetary compensation. Israel should work to strengthen the infrastructure of the Palestinian state and firmly establish it in the West Bank. This means, inter alia, fulfilling understandings reached during negotiations through agreement on terms of reference that will be worded with the full cooperation the US government. In this context, Israel will take steps such as releasing Fatah prisoners, reducing the number of checkpoints and allowing freer movement, refraining from imposing economic punitive measures, providing extensive economic aid such as encouraging Palestinian projects in Area C, and expanding PA security activities in Area B. At the same time, Israel will work to encourage quiet in the Gaza Strip. It is appropriate also to reconsider overall policy toward the Gaza Strip and to receive the assistance of third parties to overcome violent crises and deepen the security understandings between Israel and Hamas. In order to progress toward a long term political settlement and shape a desirable political situation, partial agreements and independent and coordinated actions on both sides will be necessary. This will make it possible to improve relations between both leaderships, and no less important, these measures can help build confidence between the two societies and ultimately increase the public support that the respective leaderships need to advance a long term agreement. On the regional level, Israel should speak with heads of leading states in the Arab League about its willingness in principle to renew the multilateral format, with the possibility of recognizing the Arab Peace Initiative as a basis
5

k.

l.

m.

n.

for the start of a dialogue. The objective would be to promote agreement on a comprehensive ongoing multilateral framework as a regional platform for dialogue and agreement on steps by Israel and the Palestinians to carve out the desired reality. It might be wise to invite Turkey to participate along with the others in a third party delegation, especially given the thaw in diplomatic relations and the positions Turkey has expressed in the past in favor of the initiative. If the effort to promote a long term political settlement does not bear fruit and/or the situation escalates, decision makers will have to work to promote an independent separation initiative in order to create a reality of two states for two peoples, preferably with the cooperation of the Palestinian Authority (although carrying it out will not be dependent on this), and coordinated with the US administration to the extent possible. US backing for the move, especially if it is combined with measures to promote quiet in the West Bank and Gaza, can help limit Egyptian and Jordanian opposition to a unilateral move. Preparations should be made for the day when the residents of the settlements are called upon to return to Israels delineated borders. In order to avoid a domestic conflagration, the government must seriously consider how to change the discourse with the settlers, inter alia, in order to expand public support for the two-state solution, to formulate the evacuation as a unifying move and not as the governments washing its hands of an important segment of the Israeli population, and to justify enforcement and evacuation by force if necessary. An independent, proactive, and responsible Israeli policy must include relinquishing territories outside of large settlement blocs; stopping construction outside these blocs; preparing a national program to absorb those settlers who will eventually be relocated within Israels borders; passing a voluntary evacuation-compensation law; compensating settlers and absorbing those who live east of the fence; promoting an internal dialogue to prevent conflagration; and planning for leaving the IDF in areas that would be defined by Israel on the basis of security needs. Israel will retain control of the security envelope and the external borders of the territories to be evacuated by the Israelis who relocate within the delineated boundaries of the state. In any case, Israel will initiate independent measures at the time decided on by its government, after it has prepared appropriately and has exhausted the possibilities for negotiating a settlement.

In conclusion, the recommendation is to work simultaneously on major policy efforts that support one another: one is to pursue a negotiated solution with the Palestinians, even if it is partial or gradual, and mobilize international and Arab support. The other is to take the constructive, independent steps outlined above, whose purpose is to delineate a border and to promote a regional situation of two states for two peoples, and aspire to do so with regional and international coordination. An independent

separation initiative will constitute real progress toward a two-state solution in and of itself, and will likely help create momentum toward jumpstarting political negotiations. If this attempt fails to result in understandings with the Palestinians, Israel must start to implement the independent steps in a gradual, controlled, and intelligent fashion, while examining the impact of each step before moving to the next one.

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