Tax Transfer Dispute a Microcosm of West’s Failed Management of Peace Process

In an effort to get the West to ratchet up pressure on Israel to resume tax transfers to the Palestinian Authority, the PA warned yesterday that the lack of funds could cause its collapse. That move came after Israel rebuffed demands from Washington, Berlin and Quartet Envoy Tony Blair to restore the payments, which it suspended after UNESCO accepted “Palestine” as a full member last month.

Israel may eventually capitulate, as it has in the past. But it shouldn’t – because the demand that it resume these payments epitomizes one of the biggest flaws in Western handling of the “peace process.”

The West argues that Israel has no right to suspend the payments, because they are mandatory under Israel’s signed agreements with the Palestinians. That argument overlooks one minor detail: The PA just abrogated those agreements by seeking statehood at the UN.  The 1995 Israeli-Palestinian Interim Agreement enjoins either side from taking “any step that will change the status of the West Bank and the Gaza Strip pending the outcome of the permanent status negotiations,” yet the PA is now asking the world to recognize these territories as a state -a drastic change in status – without even conducting permanent-status negotiations, much less concluding them. As Israeli Prime Minister Benjamin Netanyahu correctly noted, the PA has thereby “reneged on a central tenet” of the peace process: its pledge to resolve all outstanding issues through negotiations.

And while UNESCO membership isn’t full UN recognition as a state, the PA indeed plans to use its new status to press its claims through channels other than negotiations:

“Now that we have joined UNESCO, we will take Israel to court for systematically destroying and forging Arab and Islamic culture in Jerusalem,” said Hatem Abdel Qader, former PA minister for Jerusalem affairs. “We are also seeking to file lawsuits against Israel in international courts and bodies for stealing Arab and Islamic antiquities and assaulting Islamic and Christian holy sites….”

PA Minister of Tourism Khuloud Daibes confirmed that the Palestinians planned to file lawsuits against Israel for alleged theft of antiquities.

So the PA has just blatantly violated a central tenet of all previous agreements, and the world’s response is–Israel must honor these agreements anyway.

Clearly, this violates a fundamental principle of both law and international diplomacy, which is that if one side tears up an agreement, it ceases to bind the other side. But it’s also counterproductive, twice over.

First, if the world insists that Israel uphold agreements regardless of whether or not the PA does, Palestinians have no incentive to abide by these agreements. That’s counterproductive at any time, but it’s particularly bizarre at a time when the world is frantically trying to persuade PA President Mahmoud Abbas to honor these agreements by resuming negotiations. Why should Abbas comply with this request when the world is trying equally frantically to ensure that he suffers no financial penalty for refusing?

Second, this attitude makes signing new agreements far too risky for Israel, because it turns every such agreement into a unilateral concession rather than a trade: The PA can refuse at any moment to provide the stipulated quid pro quo, but the world will still demand that Israel cough up what it promised.

Thus, by demanding Israel resume the tax transfers, the world has effectively given both sides strong incentives to avoid negotiations. With management like that, is it any wonder that the “peace process” keeps flopping?