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"Your situation isn't good," said a high-ranking European diplomat recently. "No one believes Bibi [Prime Minister Benjamin Netanyahu] and we don't want any connection with [Foreign Minister Avigdor] Lieberman. Only a dramatic and surprising diplomatic move, like [former prime minister] Ariel Sharon's disengagement, will change the impression."

A few hours later, Time magazine published an interview with U.S. President Barack Obama, in which he expressed disappointment with Israel's unwillingness to make "bold gestures" toward the Palestinians.

In a speech at a conference not long ago, an Israeli diplomat serving in a European capital touted Israel's hoary PR line, distinguishing between "the only democracy in the Middle East" and its autocratic Arab neighbors.

"We share common values," the Israeli told the Europeans. To his surprise, a member of the audience stood up and replied to him: "What common values? We have nothing in common with you."

In diplomatic conversations, Europeans are critical of Israel because of the Gaza blockade, the construction in the Jewish settlements, the home demolitions in East Jerusalem, the pervasive loathing of the right-wing government and even the social gaps and the way Israel is moving away from the European welfare-state model.

The Netanyahu-Lieberman government is nearly always described as "hard-line" in the foreign media. This is not entirely fair: The government of Ehud Olmert and Tzipi Livni went to war in Lebanon and Gaza and built thousands of apartments for Jews in East Jerusalem and the West Bank settlement blocs - many more than did Netanyahu, who has refrained from employing military force and has declared a 10-month freeze on settlement construction. But they liked the Kadima government because Olmert and Livni made the right noises about their desire for peace and a final status agreement, whereas they don't believe Netanyahu when he talks about "two states for two peoples." The fact that Olmert and Livni achieved nothing in the negotiations makes no difference. It's the intentions that count.

Netanyahu and his aides have answers to the accusations against Israel. The blame for the Gaza blockade lies squarely with the Palestinians, who chose Hamas to reign over them and kidnapped soldier Gilad Shalit. "You are worrying about the humanitarian rights of 1.5 million Palestinians in Gaza. You should be worrying about one Israeli who is being held there," Netanyahu's people tell UN representatives.

In East Jerusalem, the government is hiding behind Mayor Nir Barkat and the planning and construction institutions, which are approving building plans for Jews and home demolitions for Palestinians. And for the diplomatic stagnation, it is blaming Palestinian Authority President Mahmoud Abbas, who is refusing to renew the talks.

There is one little problem: The world isn't buying Israel's explanations and it isn't prepared to condemn Palestinian obduracy. Obama has split the blame for the stagnation between the two sides and has also taken some of it upon himself ("We raised expectations").

American envoy George Mitchell's appeal to the members of the Quartet that they urge Abbas to return to talks, has gone unanswered. This week he completed another frustrating visit to the region, with zero results.

Obama's approach - to "park" the diplomatic process for lack of achievements and to concentrate on domestic issues - has not surprised Netanyahu. Three months ago, a senior Israeli official said the Obama administration would probably put off the Israeli-Palestinian problem to his second term, explaining: "Now they're weak, they have unemployment and the economic crisis, Afghanistan, Pakistan and Iraq, and they aren't emerging from that. They don't have the strength to complete an agreement. In the meantime, the maintenance will continue."

U.S. officials are hoping talks will be renewed within six months. The main thing is that there be some negotiations. They have no expectations of more than that.

Disturbing scenario

The Palestinian Authority is conducting a campaign to isolate Israel, based on the Goldstone report and the hatred for the Netanyahu government. Political scientists Shaul Mishal and Doron Mazza are calling it "the white intifada," which is aimed at enlisting international support for a unilateral declaration of independence in the West Bank, Gaza and Jerusalem. In a document they distributed last week, they warn of Israeli complaisance and present a disturbing scenario: The Palestinians declare independence, and Israel refuses to recognize it and is faced with a boycott. Regardless of whether it yields or reacts with force, Israel cannot win, and will also lose control of the process. Therefore the two scholars recommend a preemptive diplomatic move.

Diplomatic isolation can be costly. Former Foreign Ministry director general Gideon Rafael wrote in his memoirs that in the summer of 1973, he felt that the diplomatic stagnation, which was perceived as something taken for granted, and perhaps even desirable, was liable to become "a death trap."

Former Egyptian president Anwar Sadat cut Israel off from its friends in the Third World, proposed a peace initiative to the Americans and was rejected. He then raised the demand for the return of the Sinai Peninsula in the UN Security Council and came up against an American veto.

In his book, "Destination Peace: Three decades of Israeli Foreign Policy, a Personal Memoir" (published in English by Littlehampton Book Services, 1981), Rafael wrote that Israel rejoiced in the veto and did not realize that closing the diplomatic door left Egypt with only one option - war.

In the coming weeks Israel apparently will request an American veto in the Security Council again, in order to bury the Goldstone report. Netanyahu is planning a fourth meeting with Obama, concerning the nuclear security conference in Washington on April 12 and perhaps even before then. The agenda will center on Iran - or "the new Amalek," as Netanyahu called it in Auschwitz on Wednesday. The question is whether alongside his demand that Obama take action against Iran, Netanyahu will also tell him that in exchange, Israel will take some sort of initiative vis-a-vis the Palestinians. This would be in an attempt to persuade the world to believe him and ameliorate Israel's increasing diplomatic isolation.