Follow the Money

In the mid-1990s, then-Foreign Minister Shimon Peres proclaimed a “New Middle East,” in which trade and economics had replaced ethnic and religious wars. Israel, as an economic and technological powerhouse, was poised to be an engine of advancement for the region. He was premature, to say the least. The region was mired in ethnic and religious upheaval, and Israel’s economic and technological prowess was a huge source of Arab envy, not admiration or respect – small chance they would admit they needed the Jewish state for economic advancement.

In the mid-1990s, then-Foreign Minister Shimon Peres proclaimed a “New Middle East,” in which trade and economics had replaced ethnic and religious wars. Israel, as an economic and technological powerhouse, was poised to be an engine of advancement for the region. He was premature, to say the least. The region was mired in ethnic and religious upheaval, and Israel’s economic and technological prowess was a huge source of Arab envy, not admiration or respect – small chance they would admit they needed the Jewish state for economic advancement.

But he was right. So when President Bush took another radical step last week, calling for a Middle East Free Trade Zone to complement his call for regional democratic reforms, he owed a tip of the hat to Mr. Peres.

Now, perhaps the timing is better. The liberation of Iraq did not cause the feared “Arab street” to rise, but it has unleashed an unusual amount of introspection from Arab regimes and intelligencia (see www.memri.org). Both despotic and more moderate regimes are beginning to understand that they have to meet the aspirations of their own people or face their wrath. Satellite dishes are proliferating faster even than ballistic missiles, and pan-Arab hatred of Israel doesn’t put CD players on the table. Concern for the plight of the Palestinians – real or ginned up to divert attention from domestic ruination – doesn’t squelch the desire for economic freedom, which goes along with political freedom.

It also helps that the purveyor of the thought is the President of the United States and the offer comes in the form of economic benefits through relations with the U.S. But Israel is right there, because to enter into a Free Trade Agreement with the U.S., a country cannot be a participant in the anti-Israel boycott.

“Welfare reform”? Saudi Arabia has agreed direct its $37 million monthly payment for the PA to accounts regulated by the World Bank, rather than to Yasser’s private accounts. The EU is giving the PA more than $10 million monthly and another $5 million comes from other Arab states. That’s a lot of welfare, and it should stop. If the PA had to live on the money the Palestinian people paid in taxes on money they earned, two things would likely happen. First, there wouldn’t be enough for 17 PA security services and the skills of bomb-makers. Second, the government would need for the people to work to pay taxes. But the people might be angry with leaders who spend their tax money on the destruction of Israel and might demand a restoration of the economic cooperation that used to allow more than 80,000 Palestinians to earn their living in Israel. That would require an end to terrorism for practical, not political reasons, making it a good goal for the U.S. to set before Abu Mazen.

In both cases, obligations accrue to the governments of the Middle East – to put the people first; to open up the economic and political system to allow for advancement into the 21st Century; and to accommodate the legitimate, sovereign State of Israel. It would be a good deal for everyone.