President Obama will be hosting both Prime Minister Netanyahu and President Abbas this week. The subject, presumably, will be how to advance the prospects of a Palestinian state, and the agenda, almost certainly, will focus on such things as settlements and security arrangements. What has been getting less attention, but seems the biggest emerging fact on the ground, is the West Bank economy which is being driven by an exceptional, rising business class: the key to Palestine's civil society, around which a state must form. I have spent a good part of the summer talking to these leaders, and report on their achievements--and urgent requirements--in the current Harper's. The bottom line is this: Israel could not invent more appropriate partners to build a Palestinian state, economically federated with itself and Jordan; yet in spite of Netanyahu's exhortations, Israel seems to be doing everything to foil Palestine's economic development. Obama's chief objective must be to get Israel out of its way. (Alas, only Harper's subscribers will currently have access to the entire article. Below are excerpts from the article's opening.)
Benjamin Netanyahu ran for prime minister last winter rejecting a Palestinian state but promising to advance "economic peace." In his much anticipated speech at Bar Ilan University in June, he cautiously reversed himself on statehood but returned to his favorite theme: "Economic peace is not a substitute for peace, but it is a very important component in achieving it. . . . I call upon the talented entrepreneurs of the Arab world to come and invest here."
For Netanyahu's boosters, the phrase often means little more than increasing jobs for Palestinians on Israeli construction projects, including settlements that ring Ramallah, and in tax-exempt industrial zones; as well as more opportunity for West Bank farmers to sell to Israeli fruit wholesalers (who, in a grotesque twist, then pad their profits by controlling the distribution of their produce in Gaza). Economic peace slyly implies that Israelis can have no "partner" for a political settlement until Palestine looks more like Delaware. Meanwhile, presumably, fuller bellies and fatter wallets will make Palestinians more tranquil.
Nevertheless, economic peace prompts a reasonable question. If a Palestinian state rises, will it work? Does not the prospect of sovereignty presume a class of resilient entrepreneurs and professionals, people who will build competitive businesses that will, in turn, employ a burgeoning population?
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