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The EU Offers Israel a Raw Deal

“The European Union gave a push to Israeli-Palestinian peace talks on Monday,” the Wall Street Journal reports, “pledging unprecedented aid to the two sides if they reach agreement on their final status.” The phrase “unprecedented aid” sounds like a great deal for both sides. Israel has repeatedly tried to strike a final-status agreement with the Palestinians at great cost and sacrifice, only to be rebuffed or met with violence every single time. Since Israel obviously already wants peace, this “aid” just sweetens the pot.

The Palestinians, too, might be tempted, since they depend so much on foreign aid. And for the EU as well it appears to have mostly upside: if there’s no deal, they don’t have to spend a dime of the promised aid, and if there is a deal, it would be well worth the cost. So: three (or even two) cheers for the EU? Not exactly. Widening the scope a bit reveals this to be something much closer to what the Journal reported around the Black Friday shopping rush: the deal is much less a bargain than the price tag would have shoppers believe. The Journal noted that companies long ago figured out that if they overinflated the initial price offering they could better lure bargain hunters amid all the competition. As a result:

In a 2012 presentation, Mr. Johnson, then still Penney’s CEO, said the company was selling fewer than one out of every 500 items at full price. Customers were receiving an average discount of 60%, up from 38% a decade earlier. The twist is they weren’t saving more. In fact, the average price paid by customers stayed about the same over that period. What changed was the initial price, which increased by 33%.

And so it is with the EU’s latest fit of magnanimity, at least with regard to Israel. That’s because the EU has been slowly, but unmistakably, seeking to punish Israel financially for the EU’s policy disagreements with the Israeli government. I wrote about this over the summer, when the EU released new guidelines intended to restrict grant access to Jews who lived in the West Bank or a large part of Jerusalem, the Jews’ eternal capital. The EU had not instituted a full-fledged trade boycott, to be sure. But it’s not clear if that was because EU officials oppose such a morally repugnant policy or because the denial of grants was a way to hurt Jewish Israelis without also damaging European economies. It was no less discriminatory, in other words; just unprincipled.

The EU’s behavior also gives tacit approval to more bigoted forms of boycotts on a continent with rising anti-Semitism. So when the EU says it can offer a major infusion of financial aid to Israel if it signs on the dotted line, it is not only proclaiming its belief that Israel can be bought but also to some degree offsetting the damage it is already trying to do to Israel’s economy. Perhaps in Brussels an offer of unprecedented financial aid is indistinguishable from a shakedown, but Israeli officials can tell the difference.

With regard to aid to the Palestinians, it might end up being more expensive for the EU than officials expect. The Oslo era saw Yitzhak Rabin sign a deal with Yasser Arafat, followed by Benjamin Netanyahu doing the same, followed by Ehud Barak making a generous offer to Arafat, followed by Ariel Sharon unilaterally disengaging from Gaza and parts of the West Bank, followed by Ehud Olmert offering Mahmoud Abbas the store, followed by Netanyahu accepting in principle the two-state solution and suggesting even that dividing Jerusalem would be on the table, and then willing to release terrorist murderers just to begin negotiations.

In other words, if you want a peace deal, talk to Ramallah; Jerusalem’s door is always open. So financial aid to the Palestinian Authority is a start–or, rather, a continuation, since they already receive such aid (which Israel fully supports). But all those years of rejection and/or violence in return for Israeli offers of peace should tell the Eurocrats something about the ability to induce the Palestinians to make peace. Each Palestinian rejection was followed by an eventual Israeli offer more generous than the last. The Palestinians have learned that all they have to do is keep saying no and eventually they’ll get whatever they want.

So the EU can offer generous financial aid. The Palestinians in all likelihood will reject the terms, but they won’t forget the EU offered them in the first place. The next time the EU wants to get involved, the offer will be sweeter, and after the Palestinians reject that one the next offer will be sweeter still. By that time, the EU’s financial action against Israel will have increased as well. The EU has begun rolling a snowball downhill. Good luck stopping it.



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