How much pressure can Washington exert on Tel Aviv?

Steven Stanek, Foreign Correspondent

• Last Updated: July 26. 2009 1:27AM UAE / July 25. 2009 9:27PM GMT

WASHINGTON // Israel’s recent decision to press ahead with a housing project in East Jerusalem, defying calls by the White House to halt settlement activity, raises an inevitable question for Barack Obama: how much pressure can he exert on a longtime US ally to bring it in line with his policies?

The short answer, at least according to the conventional wisdom, is not much.

Although Israel has a variety of trade and weapons agreements with the United States – it is also the largest recipient of American aid – tough measures such as economic sanctions have traditionally been perceived as so unpopular here that no US president would risk implementing them.

“Anything that would be a real game changer, that could really grab Israel’s attention … is essentially off the table in the context of American domestic politics,” said Wayne White, a top Middle East analyst for the state department’s bureau of intelligence and research until 2005. “I don’t think Obama has a lot of options.”

A state department spokesman, Robert Wood, said this week that any talk of applying financial pressure to Israel is “premature”.

“What we are trying to do,” he said, “is to create an environment which makes it conducive for talks to go forward”. But he also noted that the US policy on settlements had not changed. “I think we’ve been very clear with regard to settlements. They need to stop,” he said.

Every US administration since 1967 has opposed the construction of housing and settlements for Jews in the West Bank and Gaza. But the rift on Mr Obama’s watch has been uncharacteristically public and blunt for two allies used to settling disputes through back channels and more subtle gestures.

The administration of George W Bush, for example, reached a secret agreement with Israel permitting it to expand West Bank settlements that Israel hoped to keep in any eventual peace deal.

Edward Walker, who served as the US ambassador to Israel during Benjamin Netanyahu’s first term as prime minister in the 1990s, said pressing Mr Netanyahu too hard on the settlement issue is a “losing proposition”.

“You can push and push Bibi, but he will find a way around it,” he said, referring to the Israeli prime minister by his nickname. “He will not cross the settler movement at this point. He’s too weak politically and he happens to believe in it anyway.”

Mr Walker added that the settlement dispute will likely be resolved in backroom meetings where diplomats “talk turkey quietly, and see what they can work out”. But not everyone believes that Mr Obama is handcuffed when it comes to implementing tougher measures. Philip Wilcox, US consul general in Jerusalem in the 1990s and the president of the Foundation for Middle East Peace, said it is “absurd” to think of the US president as “helpless” when it comes to changing the US policy toward Israel.

“That would mean Israel is ultimately more powerful than the US president on these issues,” he said, citing what appears to be growing support in the United States and in Israel for a broad shift in policies. “Does the United States need Israel more than Israel needs the United States?”

If Mr Obama does decide on some form of economic sanctions, he would not be the first US president to do so. George HW Bush, whose administration also publicly called for a full settlement freeze, instituted a policy that deducted the costs of settlements from US loan guarantees to Israel. But the penalties on the loan guarantees, which essentially allow Israel to borrow money at reduced interest rates, have amounted to only a small fraction of the total US aid package. Some say the policy, still in effect today, is more symbolic than it is practical.

Short of sanctions, there are other ways for Mr Obama to exert meaningful pressure on Israel. One option, said Mr Wilcox, might be to appeal directly to the Israeli people.

“If the public in Israel sees a growing breach between their leaders and the United States, they will begin to wonder if this is such a smart policy for Israel,” Mr Wilcox said. “And that will be reflected over time in the way they choose their officials.”

Mr Obama has publicly described the US-Israel bond as “unbreakable”, but in a recent closed-door meeting with Jewish leaders, he reportedly said that the close relationship between the two countries has “produced very little” over the last eight years.

The White House did not release a transcript of the meeting, but participants, including Abraham Foxman, national director of the Anti-Defamation League, confirmed the president’s comments.

Mr White, the state department analyst, worries that Mr Obama’s rhetoric will soon become stronger than what his policies can realistically achieve.

“Obama risks getting himself into a jam where he could take his rhetoric beyond his capabilities and become embarrassed and lose credibility in the eyes of the Palestinians and all other Arab parties,” he said.

Graeme Bannerman, a former Middle East analyst for the US state department, said he believes both sides will attempt to ferret out the other’s bottom line through “diplomatic gamesmanship”. He does not expect the dispute to escalate to the point where there is lasting damage to the US-Israel relationship.

“It is a collision course, but it’s not two planets heading towards each other,” he said. “Each one has some control.”



sstanek@thenational.ae