The Herzlia Conference has become, in the last few years, Ariel Sharon’s favorite forum for addressing the nation. One year ago (December 18, 2003), the Israeli PM used it to high dramatic effect: If the Palestinians do not take steps, he said, to quash terrorism within six months, as prescribed by the Road Map, Israel would disengage unilaterally from the Gaza Strip. The speech was curt and tense, without optimistic flourishes.

This year (December 18, 2004), Sharon’s Herzlia speech was euphoric. The year 2005, he announced, would be “the year of opportunities.”

Sharon bases his optimism on three props: 1) US President George W. Bush, who backs Israel’s interpretation of the Road Map, has been re-elected; 2) the death of PA President Yasser Arafat and his replacement by Abu Mazen will produce, he believes, a new Palestinian policy; 3) He has subdued the rebellion within the ranks of the Likud; having ousted the extreme right from his government, he is about to stabilize the latter by bringing in the Labor Party.

With these changes at his back, Sharon radiates new optimism on three fronts:

1. The Economic
“In 2005, we have the opportunity to extricate ourselves from the morass of recession, and begin real and lasting growth which will bring about a reduction in unemployment and close the gaps in Israel.”

2. The Global
“In 2005, we have the opportunity to establish a new partnership with the international community in the struggle against terror and regional and global instability. The world, and especially Europe, has learned to under‘stand what we have faced for many years.”

3. The Political
“And in 2005, we have the opportunity for an historic breakthrough in the relations between us and the Palestinians, a breakthrough for which we have waited many years. In order to actualize these opportunities, we must take the initiative. This is the hour, this is the time. This is the national test.”

We shall see that a large part of Sharon’s new optimism rests on the narrow shoulders of Abu Mazen. Before we turn to these, however, let us consider each front separately. 

The economy

Sharon’s economic optimism derives from a growth rate of 4.2% in 2004. But who was growing? There was a degree of recovery in high-tech, true, but high-tech, to date, has failed to draw this (or any) economy along with it. Most sectors have remained frozen, and hardly any new jobs have opened. In the country’s periphery, some 30% of the businesses have collapsed. The recovery and growth so touted by Sharon do not show up in the day-to-day life of Israelis. He has permitted his Finance Minister, Benjamin Netanyahu, to implement a tough neo-liberal policy, which reduces expenses in the public sector while cutting taxes for the rich.

On October 29, when Arafat was ill, Sever Plotzker of Yediot Aharonot talked with economists in the Finance Ministry. They complained that the “the Bank of Israel’s index of our economic condition has been sliding since May. … There has been a decline in exports…. Industrial production has stopped expanding. Unemployment has ceased to shrink. The deficit has deepened. Partially, at least, the recession is back.” On the other hand, they promised Plotzker that “God is great and unpredictable. The possibility that Arafat will soon depart this life reshuffles the cards, including the economic.” If there will be a rebirth of hope for settling the Israeli-Palestinian conflict, “this will have an extremely positive effect on the economy. The Prime Minister couldn’t dream of a nicer present. Nor could the lame economy.” Such was the assessment two months before Sharon’s speech at Herzlia.

The International Monetary Fund made its annual visit to Israel in December. This year it reported that “the labor market situation and the extent of poverty continue to trouble.” It noted that Israel’s poverty level kept growing last year, as 1.4 million citizens [about a fifth of the population – Ed.] were reported to be living under the poverty line. According to Tal Muscal (Jerusalem Post December 20, 2004), “This is the first time IMF officials have identified poverty as a worrying factor, especially as past reports have not recognized social issues as troubling factors for economic expansion.”

The global front

When Sharon speaks of an improvement in Israel’s global standing, he ignores one little detail called Iraq. The war there is far from over, and it has given a tremendous push to terrorism. The date set for Iraqi elections, January 30, approaches, and the chances of a democratic process seem more distant than ever. Elections, if carried out, will likely breed civil war, for there is lack of basic agreement among the ethnic groups. Most Sunnis oppose the holding of elections under occupation, and although they number less than the Shiites, the country cannot hold together without their accord. The vision of a “new Middle East,” which inspired the Oslo agreements, has turned out to be a chimera. That will also be the fate of any attempt to restore a pro-American axis on the basis of Egypt, Jordan, Israel and an Iraqi puppet-regime. America, in short, is tied down in Iraq. It will not be able, in the coming years, to launch an additional war. It has largely lost its power of deterrence.

The political front

Sharon’s political forecast is the most problematic of all. Starting from his mistaken assessment of the balance of forces, he wants to exploit two assets: Bush and Abu Mazen. Both will enable him, he hopes, to perpetuate the Occupation of the West Bank. It is necessary, he told the Herzlia Conference, to distinguish “between what is vital for us and what is not”: 

And what will the Palestinians get? Israel will “help” them conduct their elections, so that they will choose at last a realistic representative, namely, Abu Mazen. (See article, p. 4.) Not to leave anyone in the dark, Sharon goes into detail:

“The understandings between the U.S. President and me protect Israel’s most essential interests: first and foremost, not demanding a return to the ’67 borders; allowing Israel to permanently keep large settlement blocs which have high Israeli populations; and the total refusal of allowing Palestinian refugees to return to Israel.”

When we think in terms of gain and loss, we see that for the first time in its history, Israel has won American confirmation for the legality of its West Bank settlements – at the cost of giving up Gaza, which it is only too glad to be rid of.

Israeli leaders have always misunderstood the necessary conditions for settling the conflict, and Sharon is no exception. They may co-opt the leadership, as at Oslo. They may even wear down the will of the Palestinian majority (which is very tired after four years of war). But as long as a sizeable minority seeks fulfillment of basic demands, such as Israeli withdrawal from all conquered lands, no agreement giving less can hold.

Sharon remains locked in the old concept of imposing a solution by force. We can see this in the failure of British Prime Minister Tony Blair during his recent visit to the region. He proposed that Sharon turn over a new leaf in his relations with the Palestinians and the Europeans by taking part in a London peace conference, which would discuss realization of the Road Map. In refusing (after getting permission from Bush), Sharon demonstrated how far he really is from seeking new opportunities. He continues Israel’s policy of diplomacy by dictation. His chutzpah reached a new height when he suggested that Blair should conduct the conference anyway. Why not? Let the Palestinians sit with the other Arab states, and let the British give them a crash course in democracy.

Yet Sharon is on a sticky wicket. He originally justified his plan for unilateral disengagement by claiming he had no negotiating partner. On this basis he could limit disengagement to the Gaza Strip plus four isolated West Bank settlements, consolidating his hold on the rest. Now at last, the Palestinians are about to elect a partner for him. But Sharon persists in limiting his offer to Gaza and the four. If that is all, the new partner will soon become another non-partner. Déja-vu. In September 2003, we recall, Abu Mazen had to resign as Palestinian PM, in large part because Sharon had given him nothing to show to his people.    

Sharon is betting that the removal of settlers will fill TV screens with images of “civil war” between Jews, relieving him of the need for further concessions. From the peak of his ephemeral success, he overlooks the fact that Palestinians too can distinguish between what is vital for them and what isn’t. When they recover from the weariness of four years of Intifada, they too will make their accounts of profit and loss. Again they will stand before the bitter truth that it is impossible to achieve peace with Israel, because Israeli peace, whatever the package, always amounts to continued occupation. 

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