Prime Minister Ehud Barak this week sprang a surprise on his cabinet by proposing economic separation between Israel and the Palestinians. Under the Paris Accord, the economic agreement annexed to the Israel-PLO Cairo agreement between Abu Ala and Minister of Finance Avraham Shochat, the Israeli and the Palestinian economies were to be open to the free movement of goods, and especially of people.
It was no coincidence that Minister of Public Security Prof. Shlomo Ben-Ami sided with the Prime Minister, while ministers Shochat and Beilin strongly opposed the motion. This is because the basic, moral-philosophical-social differences underlying the two conflicting approaches were argued out thirty years ago, in 1969, by Levy Eshkol's government. Then, too, separation had its cabinet proponents, namely Levy Eshkol and the then Minister of Finance Pinhas Sapir, and its opponent, Minister of Defence Moshe Dayan. Sapir maintained that it was incumbent upon the Israelis, as rulers, to develop the local economy and create jobs for the Palestinians in their places of residence. What really worried Sapir and the Israeli doves was that the Israeli economy would come to depend on cheap Palestinian labor, thus perpetuating economic gaps and preventing industrialization and economic development in the construction and agriculture sectors.
That, in fact, was what happened. Palestinian workers became the hewers of wood and drawers of water for Israeli society and economy. The then Minister of Defence Moshe Dayan fiercely opposed any idea of separation or local development. Levy Eshkol did not have an assured majority; and that cabinet session ended without adopting any resolution.
Dayan decided to open the borders, in a move then known as the "open bridges policy" because the Allenby Bridge was opened to the passage of agricultural produce from the West Bank and the Gaza Strip to Transjordan and the wealthy Gulf States. This was actually a policy of making Palestinians the servants of Israel society. The Palestinians became unskilled daily construction workers and agricultural laborers, with no rights; they became restaurant dishwashers, street cleaners and sanitation workers.
Even though thirty years have elapsed since that cabinet session, nothing has changed on a fundamental level, other than the bitter experience we have accumulated as employers of hundreds and thousand of Palestinians. In economic and security terms, especially in moral and social terms, separation, ostensibly negative and prejudicial to the Palestinians, is the proper solution. The most important thing at this juncture is to set up a Palestinian state with basic independent economic foundations that can aspire to reach economic independence and non-reliance on the Israeli economy.
Under existing circumstances, in which Israel's annual $100 billion GDP equals that of Lebanon, Syria, Jordan, Egypt and the Palestinian Authority combined, being connected in any way to Israel will be disastrous for the Palestinians. Separation is one of the common necessities of existence. Ongoing connectedness will result in an inevitable clash.
The advocates of separation, however, should be warned that it must be achieved by means of a carefully controlled process. The key to the transition should be simply that Israel can gradually reduce the number of Palestinians entitled to work in Israel to keep pace with the creation of new jobs in the Palestinian Authority's Territories, especially in the Gaza Strip.
Good neighbourly relations will be maintained only on a basis of mutual respect and economic equality, or at least the prospect of ongoing and positive economic progress. The object of the separation is, ultimately, to prevent the economic exploitation of Palestinians by Israel, and to establish those good neighbourly relations on a basis of differentiation and independence.
Published by Israel's Business Arena October 20, 1999