The CIA and the “Peace Process”

Against the Current, No. 78, January/February 1999

Harry Clark interviews Professor Israel Shahak


A CONTROVERSIAL FEATURE of the torturously negotiated and implemented “Wye Plantation Agreement” is the direct, overt role assigned to the U.S. Central Intelligence Agency in monitoring Palestinian Authority (PA) implementation of the “security provisions.”  In fact, as this discussion with Professor Israel Shahak makes clear, the CIA’s central involvement has been an accomplished fact ever since the 2993 Oslo Accord, and has been no secret to readers of the Hebrew press in Israel.  Although conducted June 6-7, 1998, nearly half a year before Wye, this interview, we think, still sheds important light on the real dynamics of the “peace process.”

The interview was conducted in Jerusalem by Harry Clark, a solidarity activist from Ann Arbor, Michigan, and has been abridged for publication here. A second installment will appear in our next issue.

Israel Shahak deserves far broader attention than he has received in the United States.  A native of Poland and survivor of a Nazi concentration camp, he came to Palestine at the end of World War II. For over thirty years he has been a tireless campaigner for civil and human rights, and a sharp critic of Zionism and Israeli policies.

Since his retirement from Hebrew University, where he was professor of organic chemistry, he has authored two important books: Jewish History, Jewish Religion: The Weight of Three Thousand Years (Westview Press) and Open Secrets (Pluto Press), a series of essays on Israeli politics and society.  For many years he produced invaluable packets of translations from the Israeli press.  He is currently at work, with Norton Mezvinsky, on a book about Jewish fundamentalism and its profound impact on Israeli politics.  In a follow-up phone conversation with Harry Clark at the end of November 1998, Prof. Shahak emphasized several points, including:

  1. There will be no further Israeli withdrawals beyond those negotiated at Wye, and Arafat knows this. Arafat will declare a Palestinian “state” inside the PA boundaries.
  2. The hostile posturing of Israeli and Palestinian representatives should not be taken for their real relations, which are highly congenial when the television cameras are off.
  3. Given the power of Israel and especially of the United States, the “settlement,” despite its brutalities and injustice, is likely to be stable for a number of years—although, to be sure, not permanently.

—David Finkel, for the editors of ATC

Harry Clark: The peace process is very much in the news, the so-called peace process.  What are the interests of Israel and the United States in this process, what are they trying to get out of it, what are they moving toward?

Israel Shahak: With your permission I will not answer your question exactly as it was asked, because I want to concentrate on the United States.  The U.S. role in the so-called peace process is largely unknown except in Israel, where it is very much reported.

The real change that happened here, after Netanyahu came to power—because Netanyahu is weak with the Israeli establishment—is that he had to give to the United States what Rabin and Peres [previous Labour Party prime ministers—ed.] had successfully refused.  Netanyahu had to give to the United States, or rather to the CIA directly, supervision of relations between Israel and Arafat’s regime.

All the important talks—I don’t mean the official talks, which are unimportant as usual, but the important talks still reported in the (Israeli Hebrew) press between Israel and Arafat’s regime—are chaired either by the American ambassador in Tel Aviv, or if they are really important, by the CIA representative in Tel Aviv.

This is all from the Hebrew press.  When there is a dispute between Netanyahu and Arafat, about whether the Palestinians are so-called “fighting terrorism” or anything called a security matter, it is officially agreed by both sides that the CIA representative in Tel Aviv will be the arbiter; he actually checks with his own agents and then reports to Washington who is “right.”

I don’t have to explain to you that he is not “objective,” but directed by American interests.  But the point is that this has happened not under Rabin and Peres but under Netanyahu.

And of course, the CIA supervision of the most important part of Arafat’s regime, meaning the secret police forces which control everything and anything, is much tighter than this. All the officials of the many secret polices are being trained in the United States by the CIA and to some extent the FBI. They are very frequently called to the United States for special tours.

I believe, in fact, that American direct supervision of Arafat’s regime carried out by the CIA has no parallel in the Arab world, even in the pro-American countries of the Arab world.  Arafat’s regime has become a special enclave controlled by the CIA in very many respects.  And it is this which gives Arafat power—limited power of course, because Israel is much richer, stronger and more valuable (to U.S. interests)—but some power, to ask the United States to compel Israel to make concessions.

This is, in my opinion, the most important feature of the so-called peace process, and it is reported only in Israel, by the Hebrew press.

I don’t have to tell you that the Palestinian media are completely controlled and don’t report anything.  But as Noam Chomsky has shown through a great series of works, the main American media are also controlled on foreign affairs, and controlled by omission.

What is not convenient is not reported.  In Western Europe, the situation is more or less the same. The result is that the CIA, through Arafat, is able to mobilize a big section of the international left—quite honest people, I don’t accuse them, I accuse the situation, really—to help its own stooges!

There is the conference which you are attending [See Note].  Like everything under Arafat’s auspices, you can be sure—this is why I haven’t even asked you what has happened at the conference—that everything, at least in substance, has been approved by the CIA.

In Israel this mobilization of the left, or of the so-called left, is really ridiculous.  The so-called Peace Now or many organizations go to the American ambassador and ask him to pressure Israel on this, to do that—Clinton is in fact the messiah of the Israeli Zionist left. They have completely forgotten who Clinton is, I mean President of the United States, and for what he works.  They assume he is motivated by good will, by concern for human rights, all that stuff—and of course he refuses.

The last answer by the American ambassador to a big delegation of Peace Now and other organizations, only two weeks ago [early June 1998], was that Clinton had decided not to press Netanyahu too much, because if he did so Netanyahu would fall, and the polls he has been taking show that if there were new elections Netanyahu would win with a bigger majority than he has now.

My own estimation is the same. But this shows you what the so-called left has become .  .  .  .

The Economy and Apartheid

I.S.: I want to add something about the Palestinian Authority economy as it is now. I know you are aware how Israel puts the whole economy in fetters, and how it dominates and continues indirectly to exploit it. But I want to speak of two other things about the Palestinian economy that may not have been discussed at your conference.

The first is the legal dependence of the Palestinian economy on Israel; the second is what Arafat’s regime does for its own reasons to the Palestinian economy.

First: During Rabin’s and Peres’ time, Israel took good care of making signed agreements between itself and the PA on economic matters.  These are called the Paris Agreements, which not only the United States but also the European Community has signed, under which the PA has agreed to Israeli supervision of all aspects of the Palestinian economy.

For example, they have agreed that Israel will supervise their exports and imports.  They have also agreed, not in writing but informally, that a part of the income of Palestinians in the territories ruled by Arafat will derive from the two old sources: the work of Palestinians in Israel, and the export of low-income Palestinian products, mainly vegetables but also unfinished textiles, to Israel.

There was an unsuccessful European attempt [in May `98] to place restrictions on produce coming from Israeli settlements in the Occupied Territories.  This was not a boycott, but an attempt to deny favorable terms which all Israeli produce receive in the European community.  Europe is entitled to do this, because in its trade agreements with Israel it’s written “Israel.” They said everything outside the Green Line [1948 borders] is not Israel.

Israel didn’t debate this point.  Rather, it has openly proclaimed that if Europe will hurt the settlement process, Israel will hurt the Palestinian economy more than now, by prohibiting the import of Palestinian vegetables and unfinished textiles to Israel, or through Israel to other places.

I should state that Israel has taken care that the Palestinian textile industry never makes a finished pair of trousers, let us say, or a finished shirt.  It only makes the labor-intensive part, and then the sewn material is sent to Israel and finished there—which means that Israel has complete control over the situation, and if the borders are closed the people become unemployed.

As for Palestinian vegetables, because they are low-grade vegetables Europe will not buy them. Egypt and Jordan of course produce their own vegetables.  Israel is the only market, and if the Palestinian economy is tied to producing low-grade vegetables it is tied to Israel.  [In contrast, Israeli agriculture is heavily dedicated to specialized exports—ed.]

The other whip that Israel has over the Palestinian economy is Palestinian workers in Israel.  Israel has shown in the past five to six years that it can import foreign workers [from Romania, for example—ed.]; also, now that there is a slight recession in Israel, more Israeli Jews are willing to work in jobs formerly reserved for Palestinians from the territories.

But still Israel, in the past half year or so—whether because of American pressure or its own policy, I’m not sure if I can separate between the two—has again allowed a number of Palestinians, around 120,000, to work in Israel.

The numbers are not proportionally drawn from all areas.  The number from Gaza is small, because Israel rightly supposes that this area is especially controlled by Arafat—so why worry if they are only getting UN refugee rations?  But the number of work permits granted is especially high from the Hebron area, which is a sensitive spot so that Israel wants to keep the population there more satisfied.

Of course, by the way, Palestinian media don’t report this. I have to derive all my information from Hebrew sources or from people like Sara Roy, who publish in very obscure organs in the United States.  So in these ways Israel maintains its rule over the Palestinian economy.

And another very important thing: You will not find an ordinary investor, even of Palestinian descent, who will invest in this economy, apart from building houses for the Palestinian elite.  The only thing developing in this economy is that some Palestinian rich are building apartments as high-priced as in Tel Aviv.

There are many areas in Gaza where apartments cost as much as in Tel Aviv. (I saw this myself two-and-a-half years ago—HC.) This is for other Palestinians who will come here on vacation—you will see that the Palestinian economy will not be built by such things.

Second: The whole economy is pervaded by two things that Arafat instituted immediately when he came here—monopolies and corruption.  First are the official monopolies, abetted by the fact that imports to the Palestinian economy come from or through Israel—a list, which Sara Roy gave, of fifteen or sixteen products including flour, frozen meat, gasoline.

Basically every important product cannot be sold on the free market.  You can ask the World Bank and IMF, who tolerate all this. I can only mention that in recent weeks Arafat is being called mini-Suharto.

All these products can be sold only to Arafat-controlled monopolies, who then sell them to shops.  The distributor-agents are in many cases Fateh activists at the same time, and on top of what the monopoly takes, they take their percentage, as happens in every such system, and in addition to this there is bribery on every level which pervades the whole economy.

And by the way, those who most fully exploit this situation are Israeli companies, headed by former employees of the Civil Administration during the time of the military occupation.

You can draw the conclusions yourself, but the obvious one is that the economy will never develop in such a state, and how easy it is for Israel to exploit.  And there will never be even “ordinary” capitalism, in the sense practiced in the United States and Europe; there will be no investment in this economy.

H.C.: You have said that Netanyahu is weak. How then would he be reelected with a greater majority?

I.S.: He’s weak with the Israeli establishment, but he’s strong with the majority of the public.  Israel is now being socially and also politically transformed, and everybody is aware of this.

You know that Israel has been ruled by what we call the old elites, people who came to Israel before 1948 or at least in the early 1950s, mostly Ashkenazi [Central and Eastern European-ed.], whose dominance in economy, banking, academia and the army used to be even stronger than in the government.

This has begun to be shaken in the last twenty years [beginning with the defeat of the Labour Party in the 1977 election—ed.] but it is Netanyahu, although he is himself Ashkenazi of course, who is now head of the coalition of the “outsiders”—I am translating from Hebrew—”outsiders” meaning people who didn’t have a big enough part of the national cake and political power.

You have sent me a book about the Jacksonian revolution (The Market Revolution, Jacksonian America, 1815-1846 by Charles Sellers—HC).  One part of the Jacksonian revolution, besides its capitalistic terms, was that people who were excluded from ruling in Washington but who were growing in influence wanted to rule, so that the coalition of Virginia and Massachusetts would not decide everything.  Here it is the same thing.  Russian immigrants want to rule, Moroccans want to rule. Now there is a storm in Israel in that for the first time a real outsider was nominated for military chief of staff, who came from Iran when he was seven years old, and was in fact failed three times, probably on racist grounds, when he first attempted to enter the officer corps, and only admitted after, as a non-commissioned officer, he invented a new method of ambush.

Here then is a clear case of someone whom the elite didn’t want to accept .  .  .  So Israel is being transformed, the old elites are decaying, and like every decaying elite they are stupid and clinging to power in stupid ways, and Netanyahu is strong because he represents a coalition of the outsiders.

And I want to add something about the peace process: Why are all of Netanyahu’s quarrels with the United States adding to his popularity among his own group?  I must again say that Israeli Jews are so polarized [along religious/secular and political lines—ed.] that you cannot generalize, except on very basic questions; an issue that is popular with one group is unpopular with another.

So why is Netanyahu’s stance towards the United States and toward Arafat so popular among his group?  This “outsiders” group has a petty-bourgeois attitude toward politics, not capitalistic in the global sense but with the attitude, let us say, of small merchants or businessmen, which means: What we have won by war is our property, in the plain sense of the word.

Of course sometimes one has to relinquish a piece of property for the sake of greater benefit.  But the good merchant is the one who gives away as little as possible, for the highest price.  This is exactly the attitude of Netanyahu in the negotiations.

Now this infuriates the old elites because they are capitalistic, in the sense that they understand that one has to make long-term investments.  But a petty merchant doesn’t understand what a long-term investment is; he only understands bargains.  Netanyahu represents himself as a person who makes good bargains, paying the lowest price for an agreement.

H.C.: Can you comment further on the relationship of Netanyahu and the Clinton administration?

I.S.: I will go a little deeper into this question.  Netanyahu plays on the fact that the Republicans have a majority in both houses of Congress, and the administration cannot pass laws or budgets without the Congress.

The Republicans are for Netanyahu for three reasons, all of them discussed at length in the Hebrew press but not in the United States.  The first reason is “Jewish money.” These words are a direct quotation, not my invention.

The Hebrew press is stating—Americans can judge whether it is correct—that money from U.S. Jews is fifty percent of the money given to both parties.  As of the last elections [1996] most of this Jewish money is going to the Democratic Party.

The Republicans, according to the Hebrew press, are very much interested in having a much greater chunk of this money go to them. I don’t have to tell you that American elections are dependent on money.  And the Hebrew press is adding that because of this money factor, the big ally of Netanyahu is Al Gore.

H.C.: Yes, this is certainly true.

I.S.: Now the second factor, which is again discussed repeatedly in the Hebrew press, is that there exists a strong ideological affinity between Netanyahu, not as a person but as a representative of his coalition, and the Christian fundamentalists.

More generally, conservatives who have an ideology, or many different ideologies, in the Republican Party, so far as I can see are all tending in Netanyahu’s favor.  I don’t mean only the people who believe in the second coming of Jesus and for whom Israeli rule in the Holy Land is important; I mean also the people who follow the theories of Samuel Huntington about the “clash of civilizations.”

In working on those people, Netanyahu’s forces are supplying them with a flood of information about Muslim fundamentalism, for example—and no one is opposing him. No one is showing that there is anti—Christian Jewish fundamentalism in Netanyahu’s coalition.

And in addition, there is something that is important for continuous American policy: I mean the value of Israel to the United States as an ally. The most important consideration facing Clinton, according to the Hebrew press, is whether Israel should be pressured, because the United States may wish to build another Arab coalition against Iraq.

There are two approaches—I suppose, both in the Clinton administration and among Republicans.  One is to say let’s not give a damn about Arab states, let’s cultivate only Israel; the second is to cultivate relations with pro-American Arab states.

Obviously people who are not engaged in day-to-day foreign policy, who are only sitting in Congress, are free to express one of these two alternatives.  And the impression gained here—rightly or wrongly—is that Republicans are not giving very much weight to Arab states, apart from Saudi Arabia and the Gulf emirates, because the Arab states are poor.

Israel makes a greater impression on Americans as an ally because Israel is rich—and in addition, of course, Israel has a great army and willingness to give America a base.

So to recapitulate the three reasons.  The two important ones, I am sure, Jewish money and the Republicans’ ideological affinities (to Netanyahu’s policies), are very clear.  And the third, of which I am less but still fairly sure, is that for people with a really capitalistic mentality, the attitude is to let the Arabs go to hell, apart from the oil states.  Israel is rich, Israel is profitable, let us stick with Israel.

[A subsequent installment of this interview will cover in more depth Shahak’s views on the contours of the settlement and the prospects for the Palestinian and Israeli future.]

Professor Shahak refers to a conference in Jerusalem June 7-10, 1998, organized by the Palestinian Society for Law and the Environment (LAWE), observing the 50th anniversary of the Nakba, the Palestinian dispossession and expulsion of 1948.  Shahak states that according to his sources, no formal invitations were extended to the Israeli media by conference organizers, on the grounds that doing so would legitimize Israeli authority.

The Hebron Solidarity Committee, a group with which Israel Shahak is associated, asked the organizers of the conference to present a panel discussing Zionist ideology, the apartheid character of the Olso accords and the need for a democratic secular state in former Mandate Palestine.  The request was refused, though there was on panel on the theme of post-Oslo Palestine during which several speakers did discuss these topics.

An HSC representative spoke from the floor, criticizing the conference for downplaying this theme.  An Israeli argued from the floor that claims that Palestinian Authority (PA) rule is worse than Israeli rule only played into Israeli hands; the director of LAWE, who was on the panel at the time, said that such statements damage the cause of Palestinian human rights.

This view was challenged emphatically from the floor by Norman Finkelstein, the critic of Zionism who had spoken during the panel on Oslo. Finkelstein stated that while we might argue that Israel wanted it this way, or that it serves Israel’s purposes, we absolutely must tell the truth-and that he had several friends in occupied Palestine living under Israeli rule (‘Area A”) who were dreading the transfer of their area to the PA.—HC

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ATC 78, January-February 1999