The Costs of the Israeli-Palestinian Conflict or how Sara Netanyahu's household recycling fund can bring improvements to the Israeli GNP

The Rand Corporation recently released a report called The Costs of the Israeli-Palestinian Conflict.

It has been making the rounds from Forward to the Jewish Press. I decided to take a quick read, and got half way through it and was struck by air of ‘lost in wonderland’ which haunts the writers of this report for most of its 273 pages. The question of ‘how much, who pays, and for how long’; is never fully addressed in the study.  It touts ‘end financial benefits’ to both the Israeli and Palestinian communities if a two-state solution is established while ignoring the one timeless fact of state sovereignty; nothing is free.

In 2005, the Rand Group released a study on the viability of a Palestinian State and estimated that the International community would need to invest over $33 billion USD over 10 years before a Palestinian State could potentially be a viable, rather than, just another failed mid-east state.  Who knows, what the price tag would bottom-line costs would be ten years later? 

When the 2005 study was released, the Gaza Strip was not Hamastan  nor had infrastructure had  been ravaged by three military engagements with the IDf.  Relations with the Egyptians had not  deteriorated to their current state with no signs of rapprochement in sight. Who pays, and how much is never fully explored. Maybe we can make the Greeks pay!

The recent Rand study makes a number or erroneous assumptions which bear little resemblance to the current facts on the ground. Such as, the Rand Report presumes there will be a full reconciliation between West Bank and Hamas leadership.  Currently, there has been a seven year separation with no true reconciliation for the foreseeable future. Just as recently as last summer, West Bank Palestinian dictator, Mahmoud Abbas, had to circumvent an attempt against his rule by Hamas members.  Nor is there any accounting for the greater infrastructure spending needed to rehabilitate the Gaza Strip from its current dilapidated state. 

This airy-fairy magical reconciliation between Hamas and Fatah is vital for the Rand report’s most positive scenarios; two-statement peace agreement solution, a coordinated or unilateral withdrawal by the Israelis. In all Rand’s ‘best-case’ scenarios the report assumes that there will be magical territory congruity between the West Bank and Hamastan with no thought given to the practicalities of ‘how this is to be achieved’. I am sure, Fatah would really like to know.

The search and development for natural gas outside of the Gaza Strip, and the development of a deep sea port is absolutely vital and necessary to making Palestinian state viable, without this, the Palestinian state will be just another failed mid-East state in the community of nations. 

The Rand report does not, for even a moment, entertain the possibility, in the event of a unilateral uncoordinated withdrawal from the West Bank that the Israelis may chose not to carry on economic trade with their Palestinian neighbors. It would not be the first experience Israelis have had with undesirable neighbors... Even with a ‘peace’ agreement duly signed by all parties does not mean Israelis would chose to participate with closer ties, either economic or social with their neighbors. The Israelis will continue to thrive in the event of a divorce, but the Palestinian economy would collapse. And the Rand rolls the dice heavily on a complete reconciliation rather a divorce absolute.  

Another presumption of the Rand report is that the Allenby- King Hussein  border bridge between Jordan and the West Bank will be under full Palestinian control, which given the history of PLO in Jordan, I would suggest runs completely contrary to Jordanian security needs – or even taking into account the recent ‘coldness’ that has entered into Jordanian-Palestinian relationship. 

 And let’s talk about the settlements. The Rand report suggests anywhere from 60,000 to 100,000 Israeli-Jews would have to be evicted from their homes and relocated. It suggests the International community, in the interests of peace, should pick up at least 75% of the tab for evicting Israeli Jews from their homes.

The report never mentions the ‘actual’ cost or what that figure would look like but there is baseline to start.  The estimates for the disengagement from the Gaza Strip were around US$2 Billion for just under 9,000 Jews. So if we do the math, and take the lowest baseline figures for eviction that makes around 60,000 Jews, and it will cost approximately US$34 Billion. According to the Rand formula, the international community should be on the hook for approximately 75% to the tune of around US$25.5 Billion. Where the Israelis are going to up with an extra US$8.5 Billion is beyond my ability to project. Who knows, maybe Rand is counting on hitting up Sara Netanyahu's household fund for recycling of plastics and bottles for the Israeli contribution.