Australia / Israel Review

Tzvi Fleischer

It is very disappointing to read reports that Australia has announced it plans to send two senior Australian diplomats to Teheran to participate as “guests” in the Non-Aligned Movement (NAM) conference there from August 26 through 31. As Ruth Wedgewood notes elsewhere in this edition, this forum is being exploited by the Iranian regime to gain support for its non-existent “right” to enrich uranium, and to erode the increasing isolation Iran has experienced as sanctions mount because of its defiance of the UN Security Council and International Atomic Energy Agency over its illegal nuclear weapons program. Moreover, it is highly likely that the conference will be used by the Iranian regime to promote their unconscionable efforts to demand Israel’s destruction – following on from President Mahmoud Ahmadinejad’s August 17 claim that “The Zionist regime and the Zionists are a cancerous tumour” which must be “excised,” as well as various other antisemitic and Holocaust denying rants.

By sending UN Ambassador Gary Quinlan and Joanna Hewitt, a special envoy employed by the Prime Minister, Australia, which is not a NAM member, is inadvertently or not, legitimising and abetting this Iranian agenda – which is to make the NAM gathering as significant as possible. This is at a time when the US and other responsible actors are working hard to try to limit the amount of high-level international participation in Teheran’s PR extravaganza.

Sending the envoys is strongly against Australia’s interest in preventing a nuclear-armed Iran, which would destroy the Non-Proliferation Treaty regime and likely cause a nuclear arms race in the world’s most volatile region. Isolating Iran is the best-hope of achieving these interests peacefully. Australia’s move makes it that much more likely that the world will end up in the no-win situation of having to decide whether to let Iran acquire nuclear weapons or take military action, with all the risks and uncertainties that entails.

One can only hope the government will have come to its senses before the conference begins, and, as opposition Foreign Affairs Spokesperson Julie Bishop has urged, cancel Quinlan’s and Hewitt’s travel plans, and confine any Australian involvement to the staff of Australia’s Teheran Embassy.

Culture, “Occupation” and the Palestinian Economy

When US Presidential candidate Mitt Romney mentioned “culture” as a reason the Israeli economy has vastly outperformed the Palestinian one during his visit to Israel in early August, Palestinians and their advocates reacted angrily. Palestinian official Saeb Erekat said Romney’s claim was “racist” and he failed to understand that “the Palestinian economy cannot reach its potential because there is an Israeli occupation.” Others, including the Associated Press, went on to complain about the economic effects of “occupation” in more detail.

But frankly this “It’s the Occupation, stupid” argument does not hold water.

Yes, it’s undeniable that the Palestinian conflict with Israel, the checkpoints, the violence, and the lack of control over export infrastructure etc., has economic costs for Palestinians. So surely the relatively well-educated Palestinians, whose economy has performed similarly over time to neighbouring countries like Jordan, Syria, Egypt, would be way ahead of others in the region if not for the “occupation”?

Actually we know this is unlikely because we can easily compare the economic performance of the Palestinians under “occupation” with their economic situation not under occupation by looking at the economic realities before and after 1967.

As scholar Efraim Karsh documented in a 2002 article, starting from a poor and stagnant base in 1967:

During the 1970’s, the West Bank and Gaza constituted the fourth fastest-growing economy in the world – ahead of such “wonders” as Singapore, Hong Kong, and Korea, and substantially ahead of Israel itself. Although GNP per capita grew somewhat more slowly, the rate was still high by international standards, with per-capita GNP expanding tenfold between 1968 and 1991 from $165 to $1,715 (compared with Jordan’s $1,050, Egypt’s $600, Turkey’s $1,630, and Tunisia’s $1,440).

And remember, the world-leading growth of the ’70s and ’80s was during the period of most direct “occupation” – with no Palestinian Authority (PA) and none of the extensive autonomy, under their own government, which 98% of Palestinians now have in the cities and towns of the West Bank.

Palestinian living standards actually stagnated once the PA took over in 1994.

In reality, what has most damaged Palestinian economic prospects in recent decades has been terror and war (although corruption has also played a significant role). The decline of the mid-1990s was caused primarily by a campaign of suicide bombings by Hamas, leading Israel to shut the door to Palestinians working in Israel, or otherwise participating in the Israeli market.

Things improved economically for Palestinians in the late 1990s as terror was brought under control. Then the second intifada of 2000 to 2005 caused a major collapse in Palestinian economic fortunes from which they have still not fully recovered. But recent quiet has seen major economic improvement in the West Bank, with four years of growth averaging 9% per annum. (Gaza too has seen strong growth in the last couple of years).

Of course, the World Bank recently pointed out that this growth is largely based on foreign aid, and is thus an unsustainable economic base for a Palestinian state – as highlighted by the PA’s current cash crunch caused by donors failing to deliver on pledges.

But the fact remains that the Palestinians have done best economically when they are not involved in a terror war with Israel. And this is wholly unsurprising – war is always costly and not conducive to the stability and certainty business requires.

The truth is that, depending on how you define “culture”, almost everyone – right, left and centre – agrees that culture has an effect on differing international economic outcomes. But the cultural factor that has most damaged Palestinian economic prospects has been the culture of hate and of lionising violent “resistance” directed against Israel, which in turn leads to repeated outbreaks of terrorist conflict with all the costs thereby entailed.