Palestine lost: It’s up to the Palestinian people to shape their future now

The agreement between the United Arab Emirates and Israel to normalize relations is essential for future regional peace and stability. Not only will these two countries benefit, but regional stability translates to global security.

Just this week, as an example, a Sudanese Foreign Ministry official announced that his government is “looking forward to concluding a peace agreement with Israel.” In these diplomatic breakthroughs, the Palestinians have lost.

Now is the time for the Palestinians to assess their strategic next steps. Their future will not look like the past — or at least it should not. The Palestinian Liberation Organization, Fatah, Hamas, the Palestinian National Authority — the entire enterprise — will need a hard reset if its leaders ever hope to realize the aspirations of its people. Palestine’s next generation, not the old guard, know these tough realities.

Israel is a dynamic, increasingly strong regional power that will continue to shape the Middle East. The United Arab Emirates rapprochement is just the beginning. Bahrain, Oman, and eventually Saudi Arabia will normalize their diplomatic relations with Israel.

These countries understand that a Gulf realignment will spur robust economic relations. Israeli-Gulf trade will obviously include advanced military and cyber technology but also breakthroughs in water, energy, agriculture, and health care, putting into motion a positive feedback loop that will drive diversified capital and economic growth for a region too dependent on atrophying oil money.

The first Gulf state adopters will benefit economically more than those Gulf states who hesitate. The Palestinians could find that Israel has broad political, economic, and even social support with much of the Middle East in the next few years.

Despite Netanyahu’s suspended annexation of the West Bank and East Jerusalem as a concession to the United Arab Emirates, Israel will continue to expand its settlements. There is little doubt that Israeli growth rates in the major settlement blocs and beyond will track similarly in the years ahead as it has for the last five decades. To protect these settlements, Israel Defense Forces will continue occupation in the West Bank, with or without Palestinian security cooperation.

Young Palestinians also know that its leadership is irredeemably disconnected from its people. The 84-year-old President Mahmoud Abbas is in his 15th year of a four-year term. The Palestinians have not held legislative elections since 2006, when Hamas won. The Palestinian Authority, the governing structure for the West Bank, is headed by long time Fatah loyalist Mohammad Shtayyeh. Given its dysfunction, 80 percent of the Palestinians believe that the Palestinian Authority is corrupt, including two thirds of the Palestinians who believe that government corruption is deeply rooted. Hamas rule in Gaza has been marked by despair, isolation, and poverty.

The narrative of the talented, educated, entrepreneurial Palestinian class has also been eroding for decades. In the West Bank, the Israeli occupation restricts access and movement — internally and externally, to even neighboring Jordan. Israeli control also denies access to natural resources for Palestinians in their own land — labeled by Israelis as “Area C,” which amounts to 60 percent of the West Bank. These structural impediments to broad based economic growth in tourism, agriculture, and manufacturing has fundamentally stymied the growth of an inclusive economy. Further, because the Palestinian economy is tied to the Israeli shekel, Palestinian labor and services are uncompetitively high internationally. Finally, the Palestinian business climate and its education system have stagnated, particularly when compared to Jordan, Morocco, and the United Arab Emirates over the past few decades. As other countries modernized its institutions, the West Bank has become increasingly less competitive as a regional talent pool. In Gaza, Hamas has created a lost generation where the youth have no hope, no future, and no connection to the world. 

From the 1949 Israeli-Arab Armistice to Jared Kushner’s Peace to Prosperity Plan, the Palestinians have been unable to realize their vision of national independence. On the Israeli side, there is very little demand to negotiate with President Abbas’s sclerotic, fractured leadership team. While some still hope for a two state solution, the Palestinians need to prepare for a more complicated reality.

The first step is to set national and local elections so that the entire range of Palestinian leadership — from mayors to the president — has renewed political credibility.

Perhaps controversially, Hamas and the diaspora must be allowed to participate in elections for the results will determine the Palestinian vision of its future.

Concurrently, the Palestinians should hold a referendum on the legitimacy and viability of the Palestinian National Authority. Depending on the outcome of the referendum, the Palestinians may give notice to the Israelis that they are ending the Palestinian National Authority and shifting governing responsibility back to Israel. While security cooperation has been tacitly suspended, the closure of the Palestinian National Authority would transfer all policing, education, and health responsibility for the Palestinian people to the Netanyahu government, recognizing that the Israelis are the real center of political power in their lives.

Second, the Palestinians must sever donor assistance. Given endemic corruption, this will take moral courage and economic sacrifice. Over the decades, particularly during the Salam Fayyad period, donors provided development assistance to prepare the governing institutions and private sector for independence and statehood. In the absence of a Palestinian state, assistance simply subsidizes the Israeli occupation and failed Palestinian National Authority. In the event the Palestinian National Authority ceases, the Israelis will have to finance Palestinian basic services through increased taxes.

Third, the Palestinians must be prepared to accept a Bantustan-like arrangement coupled with disaggregation in Gaza under Israeli rule, sue for a one state solution with equal rights in Israel, or propose bold new alternatives.

The Israelis, of course, will have a voice in this debate. An Israeli state with full Palestinian rights ends the Jewish state experiment.

A Palestinian Bantustan would be unsatisfactory to the Palestinians and most of the world as it models the worst of apartheid formerly seen in South Africa. Given the bad choices ahead and the realpolitik between the Gulf and Israel, the Palestinians must shape their own destiny.

To begin, the Palestinians can exploit the emerging Israeli-Gulf realignment to their advantage. The Palestinian people are a natural political, economic, and cultural bridge between Israel and the Gulf, with the unique position to serve as the brokers of broader integration. Specifically, the Palestinians could work with the Saudis and others in the Gulf Cooperation Council to shape an updated version of the Arab Peace Initiative that delivers full diplomatic relations for the rest of the Gulf states to Israel in exchange for a final settlement that reflects the changes since the 2002 offer. The Arab League made this bold offer to Israel in 2002, yet Israel never responded.

Perhaps now given the United Arab Emirates agreement, Netanyahu believes he does not need to make concessions to the Palestinians in order to obtain peace in the region. An American administration should disabuse the Israeli Prime Minister of this view. A Palestinian led, updated Arab Peace Initiative is the best, most logical path forward for both people and nations.

The Palestinians know, however, that they have been unable to secure independence through a negotiated two state model for more than 25 years and prudently should have other options at the ready. For instance, while a confederation with Jordan and Egypt harkens back to the 1949-1967 era, it may have some legitimacy in a more modern Middle East. Such a proposal requires the support of the Palestinian, Egyptian, and Jordanian people and necessitates that the Palestinians abandon their decades long dream of an independent state. To start, the Palestinians would conduct a nonbinding referendum to determine the appetite of its citizens to end its conflict with Israel by integrating with its neighbors.

A confederation builds upon the lessons of an earlier time. After 1949, Jordan expanded its borders, administered the West Bank as part of the Hashemite Kingdom, and gave full civil rights to all Palestinians. While not as fulsome, Egypt governed Gaza in a similar arrangement. In this model, the Palestinians would outsource their military, foreign relations, and banking systems to their neighbors in exchange for local autonomy and expanded opportunities in established states. The Gulf countries and the international community would need to facilitate a final agreement by providing massive amounts of public and private capital, technology, and political cover that is front-loaded to help Jordan and Egypt absorb this geopolitical accommodation for the benefit of the Palestinians, the Middle East, and the world.

The Palestinians are in a difficult situation; they essentially must choose to continue to pursue their dream of a potential state without steadfast allies, purse, or political power — or prioritize the collective dreams of their next generation outside of national independence.

The United Arab Emirates-Israel deal tips the increasingly unlikely reality of statehood further away. Nevertheless, the Palestinians can shape their destiny by resetting its leadership, engaging its people, renewing its vision, and seizing the negotiating initiative.

R. David Harden is managing director of the Georgetown Strategy Group and former assistant administrator at USAID’s Bureau for Democracy, Conflict and Humanitarian Assistance, where he oversaw U.S. assistance to all global crises. Follow him on Twitter at @Dave_Harden.