This is why the 'Deal of the Century' is just old wine in a new bottle

The White House’s Peace to Prosperity plan claims to offer Palestinians an opportunity for a better life, while the Trump Administration signals its intention to abandon the Oslo Peace Process that has defined how Western states have developed their Palestine policy – under US leadership –  since 1993.

That Oslo framework is centred on the establishment of a Palestinian state in the West Bank, East Jerusalem and Gaza, and this has been rendered unrealisable by decades of Israeli colonisation, moving over 600,000 of their citizens as settlers in the occupied Palestinian territory (OPT).

This has changed the nature of the population in the OPT and has paved the way for eventual annexation. Indeed, leading Israeli politicians have for some time been very clear in expressing their unwillingness to cede control over the OPT to autonomous Palestinian rule.

For the first time, a US administration is signalling that it will support those aims, notably breaking a long-standing taboo of moving the US Embassy to Jerusalem and recognising Israeli sovereignty over the Golan Heights seized from Syria in 1967.

What this does, however, is leave the US’ international and regional Middle East allies, including the Palestinian Authority, in a tenuous situation by abandoning at least the hope offered to Palestinians in a peace plan, no matter how unlikely, acting as a kind of ‘release valve’ on political unrest.  

So, while explicitly sidestepping the politics of Palestinian basic rights or aspirations for an independent state, Peace to Prosperity claims to at least offer Palestinians the possibility for a good life under Israeli rule…devoid of a political resolution.

While offering little in the way of qualitative details of how that might happen, the plan does offer the promise of renewed spending – following recent and devastating US cuts – of upwards of $50 billion, addressing three priority areas: the economy, people and government.

Far from a new proposal, however, this is just the latest version of the same US plan that has been rehashed, reshaped and modernised over-and-over again since the 1970s, seeking to keep Palestinians quiet and to accept their lot under Israeli rule, regardless of what that rule looks like.

‘Happy Palestinians’ and ‘Quality of Life’ initiatives 

In the 1970s, the US began using financial incentives as a way to try to buy peace in the Middle East, while providing Israel with assurances for its security. So when in 1978 the Carter administration left Palestinian rights out of peace negotiations between Israel and Egypt, it instead attempted to offer a ‘depoliticised’ solution to the Palestinian ‘question’ by adopting policy based on the idea that 'happy' Palestinians who had a job, steady employment and a functioning administrative structure would be willing to accept living under Israeli occupation, even if temporarily.  

This approach was updated by the Reagan Administration in the 1980s when it attempted to find a peaceful solution by promoting economic issues in lieu of a political settlement.

Proposed as a ‘Quality of Life’ initiative in 1983-4, the US attempted to promote political reconciliation between Israel and the Palestinians through economic inducements that were in theory separate from politics, while making the occupation palatable enough for Palestinians to accept living under the status quo.

The 1970s and 1980s were though a different era and this put limits on US influence.

First, Israel was at that time wary that economic development would embolden a Palestinian bid for independence. Second, Palestinians feared that any agreement without a political resolution would reinforce the status quo of Israel’s occupation and colonisation of the OPT: a political ploy meant to substitute economics for peace.

At that time Arab donors provided substantial support for Palestinians to not only survive under Israeli military rule, but to challenge it. Further, in the 1980s wealthy Palestinians increased their funding for Palestinian resistance (sumud) to Israeli rule. 

Perhaps above all else, in that period the USSR acted as a powerful counter-balance for the Palestinians. That included military support for Palestinian liberation groups, labelled terrorist organisations in the West.

Yet, while the US plan was checked, the basic idea of trying to separate politics from Palestinian economic development survived in US policy circles, like this quote from 1989: ‘Economics may be politics in the West Bank and Gaza, but the American government can and should attempt to separate the two for policy purposes’.

 Oslo Peace Process and An Investment in Peace 

The decline and fall of the Soviet Union, and the First Gulf War, radically realigned Middle East regional dynamics. Further, the success of the First Intifada by Palestinians at extracting costs from Israel for occupation suddenly opened Israel up to the earlier US-led approaches towards ‘buying’ peace. So, with the US left as the lone superpower, it had an opportunity to assert its prior peace model of economics before (or even without) politics.

This led directly into the Oslo Peace Process, which would be dominated politically by Israel and the US, supported by a ‘depoliticised’ economic development model underwritten financially by Europe and managed conceptually by the World Bank. There the US and its Western allies reinserted the logic of the ‘Quality of Life’ and ‘happy Palestinian’ plans.

This notion informed the 1993 World Bank development plan, An Investment in Peace, that became the blueprint for donor aid from October 1993 onwards. As the World Bank stated in An Investment in Peace: ‘Political settlement and peace is a necessary, but not a sufficient, condition for economic development in the OT [OPT]’. International donors argued that development could foster conditions conducive to peace, and a political resolution afterwards.

The dimensions of Palestinian self-rule radically realigned in this period, too. Before Oslo, international consensus favoured a complete Israeli withdrawal from all the OPT and supported Palestinian aspirations to create their independent state.

Now international sponsors of the peace process largely exclude East Jerusalem from the calculus of peace-building, and Palestinian refugees were mostly isolated and began to be left out of peacebuilding by the donors. Further, Israeli settlement building and annexations of Palestinian land in the OPT were never seriously challenged. Sometimes those settlements were implicitly accepted as ‘facts on the ground.’

Israeli settlements, the status of East Jerusalem and the re-settlement/return of Palestinian refugees were left undetermined and open to further negotiation by Western donors who had little appetite for Palestinian demands that might upset Israel.

All the while, Oslo was lauded as an example for what peace-making could achieve, and Israel was able to re-establish its international legitimacy after much damage done had been done to its reputation in the First Intifada.

What is old is new again 

Though Oslo had been greeted with great optimism, prominent detractors were warning of its flaws. Much has been written about what happened next.

In brief, not long after Oslo was signed in 1993 serious setbacks hobbled the Peace Process, such as closure preventing Palestinians and their goods from moving freely, a rapid decline in Palestinian business vitality, increasing extremes of violence, the assassination of Israeli Prime Minister Yitzhak Rabin in 1995 and the first election of Benjamin Netanyahu in 1996.

The battered process eventually collapsed into the incredibly violent Second Intifada (2000-2006), and was only kept alive – in name – by international donors. Meanwhile, in that time, Israel has come to be dominated by right-wing political parties that are opposed to Palestinian statehood, while on the Palestinian side parties who are opposed to Oslo have also had success given Oslo’s obvious failure.

So, after 26 years of Oslo and An Investment in Peace, with various modifications like the Roadmap to Peace and the Palestinian Reform and Development Plan, and new political boundaries being set by the Trump administration, there has come the need for a rebranding of the long-running US approach of attempting to buy Palestinians into silence with economic incentives.

Palestinian aspirations to self-determination 

History is not predetermined, and even if we can look back at Oslo with the benefit of hindsight, we should not forget that there was an incredible degree of optimism (and perhaps unparalleled political will) to build some sort of agreement for peaceful cohabitation between Israelis and Palestinians, even if it were asymmetrical by nature.

It is equally hard to ignore the logical framework of the US approach, how it keeps reappearing, and the violent dispossession that this economics-before-politics (and economics-without-rights) model keeps leading Palestinians into.

That same process also guarantees that any Trump Administration offer for ‘dignity and opportunity’ is as unachievable as the credibility of the actors presenting it. Yet, the fact that the model needs to be reinvented time-and-time again is also indicative of something else: its inability to completely subdue and quell Palestinian aspirations for freedom and a better future.

Ultimately, Palestinians have been unwilling to surrender to perpetual subservience to Israel, in spite of the odds against them. No matter how many times the US presents the same plan, there is a spark in Palestinians – like every conquered people throughout history  – that sees them resist domination and strive ultimately for freedom.

Palestinians keep pressing for self-determination, which Edward Said once described as freedom, sovereignly and equality. So, building a peace and development plan that starts with politics and is based on such principles may work and lead to real peace, and true prosperity. The long-running US alternative has shown it will not, no matter how it is rebranded.