by Jonathan Adler
28 May 2019
The White House revealed last weekend that the “Deal of the Century,” the administration’s plan to resolve the Israeli-Palestinian conflict and promote peace in the Middle East, will be crafted by and for businessmen.
Jared Kushner, a real-estate mogul and son-in-law and senior advisor to President Trump, will launch the plan by convening an “economic workshop” in Bahrain at the end of June. There Arab finance ministers and international businessmen will discuss how to “encourage investing capital” in the West Bank and Gaza through infrastructure and industrial development.
Over the past months, many have speculated about what this investment might look like. Journalist Vicky Ward suggests that the deal will include a Saudi-Gaza oil pipeline, complete with refineries, desalination plants, and a shipping terminal in Gaza. Rumors have circulated of a trans-desert railway that will connect Baghdad to Haifa. And Saudi Crown Prince Mohammad bin Salman has reportedly offered the Palestinian Authority a lofty sum of $10 billion if they accept Trump’s deal and relinquish their claim to a Palestinian capital in East Jerusalem.
The political component of the deal will be unveiled only after the economic workshop. It will not, however, include an independent Palestinian state. In a recent interview with Robert Satloff, the executive director of the Washington Institute for Near East Policy, Kushner dismissed Palestinian statehood as a matter of semantics: “If you say ‘two states,’ it means one thing to the Israelis, it means one thing to Palestinians,” he remarked. “‘Let’s just not say it.’” This position is a non-starter for the Palestinian Authority, whose presence in the upcoming workshop is not even guaranteed.
Satloff argues that we should “view Kushner and his colleagues as developers applying to the Middle East lessons from the New York real estate market than as diplomats trying to solve a thorny, long-standing international dispute.” But this approach is nothing new. In fact, Kushner is following a long tradition of deal-making in the Middle East that, by prioritizing economic development and avoiding or delaying political solutions, has proved to be disastrous for the region and for Palestine in particular.
Before the “economic workshop” next month, it is worth reminding ourselves of a similar deal completed 100 years ago that would have far-reaching implications for the conflict – and which will foreshadow the failure of Kushner’s plan to secure a lasting peace.
Under guidance of ‘advanced nations’
On April 8, 1919, the British and French petroleum ministers met to negotiate their own deal of the century. Before World War I, Britain had acquired a 50 percent stock in the Turkish Petroleum Company (TPC), a syndicate that had gained the rights to seek oil in Iraq. The remaining shares were split between German and Dutch investors.
By the end of the war, Britain and France had emerged as victorious Allied powers that could reshape pre-war oil agreements to suit their own interests. The petroleum ministers, Walter Long and Henri Berenger, agreed that France would take the TPC shares previously held by the Germans. In exchange, France relinquished its territorial claims over the oil-rich Mosul region in Iraq and committed to construct pipelines and railways to link Iraq with the Mediterranean.
The next step was to offer a political vision to justify British and French control over the region. The Covenant of the League of Nations, signed in June 1919, created the system of mandates, whereby territories “inhabited by peoples not yet able to stand by themselves” would be placed under the temporary guidance of “advanced nations.” Britain and France could thus claim to be safeguarding the “well-being and development” of Middle Eastern peoples while fulfilling their own imperial goals.
Like Kushner today, Britain claimed that the development of modern industry necessarily came before the establishment of an independent Palestinian polity. Yet Britain’s quest to construct a pipeline to the Mediterranean, as secured by the Long-Berenger Agreement, came at the direct expense of the Palestinians.
Although land surveys had shown that a pipeline from Iraq to the Lebanese port city of Tripoli would be the financially sound choice, Britain sought an oil terminal in Palestine, under its direct authority, at the Haifa Port. After the TPC struck oil in Iraq in 1927, Britain bribed the oil company with unprecedented privileges. The company was granted exemption from nearly all local taxes, access to state land with the right to expropriate additional private land, and permission to import foreign labor.
Negotiations between the TPC (which became the Iraq Petroleum Company in 1928) and the British government took place without any input from Palestinians. The Iraq-Haifa pipeline, completed in 1935, secured one of Britain’s long-standing imperial interests. But because it provided no positive benefit to the local Palestinian population in the form of tax revenue, it did nothing to address – and in some cases exacerbated – the growing problems of land loss and unemployment that plagued Palestinian society throughout that decade.
Britain’s singular focus on colonial development in Palestine had a crucial political effect as well: to cement Britain’s support for Jewish settlement. British officials viewed Palestinian society as incompatible with their vision of development and preferred to work with English and European Jewish industrialists who conditioned their investments on British support for the Zionist project. Large-scale infrastructure such as the IPC pipeline was a point at which British and Zionist interests converged.
What can we expect for our own century?
For the Palestinians, Britain’s mighty rhetoric about their interest in the “well-being and development” of the local people rang hollow; Britain had simply expanded its empire into the Middle East, further distancing Palestinians from political sovereignty.
British rule in Palestine is now a distant memory. And yet, US leaders still subscribe to its century-old logic. Kushner rightly observes that conflict has stifled economic opportunity for Palestinians. But he fails to grapple with the essence of this conflict – a century-long saga of dispossession, expulsion, and military occupation – which requires not merely financial restitution for Palestinians but also a just political solution.
For Kushner, history is only a burden. Palestinians, he believes, should simply let go of their “grandfathers’ conflict” and allow his plan to “focus on developing the infrastructure, the rules, the training for a lot of the people.” But he refuses to say who will develop the infrastructure, set the rules, and provide the training, nor does he discuss the conditions Palestinians must agree to receive this surge of investment. Indeed, there is no reason not to assume that the primary investors in his plan, including Gulf States, Egypt, Jordan, Iraq, Israel, the US – everybody except the Palestinians – will be the primary beneficiaries.
With history in mind, we should be skeptical that this plan will even bring about development for Palestinians. And in a way, Kushner’s deal is worse for Palestinians than what was offered by Britain a century ago. The Mandate was justified – if only in words – as a step toward self-determination and sovereignty for Palestinians. Kushner’s deal, on the other hand, will try to bribe Palestinians away from political sovereignty toward a mere promise of economic prosperity.
History informs us that the development of infrastructure alone has never been a path towards peace. In the Middle East, infrastructure has always been a double-edged sword: by building pipelines and laying railways, as historian Timothy Mitchell argues, oil companies were also erecting “the infrastructure of political protest.”
This was particularly true in Palestine where, during the mass anti-colonial uprisings of the late 1930s, the IPC pipeline, bridges, telephone lines, trains, and other British infrastructure were frequent targets of attack. To protect their investments, Britain transferred tens of thousands of troops to Palestine and violently suppressed the revolt. They also enlisted Jewish recruits, who learned the keys of British counterinsurgency strategy: torturing and murdering civilians, destroying houses, and blowing up villages. These were the same brutal tactics the Haganah used to expel hundreds of thousands of Palestinians a decade later.
The British left Palestine in May 1948 with their tail between their legs, having laid the groundwork for 100 years of conflict. With neo-imperialists like Kushner leading the way, we should expect nothing better for our own century.