Dispatch: Netanyahu's Speech Before the U.S. Congress

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Analyst Reva Bhalla examines the ongoing intractability of the Israeli-Palestinian conflict, in light of recent speeches from world leaders.

Editor’s Note: Transcripts are generated using speech-recognition technology. Therefore, STRATFOR cannot guarantee their complete accuracy.

Israeli Prime Minister Benjamin Netanyahu delivered a speech to the U.S. Congress on May 24 spending a lot of his time on the threat posed by Iran and explaining the reason why Israel has not been able to proceed on the peace path outlined by U.S. President Barack Obama and the presidents before him.

The gist of Netanyahu's argument was that, while Israel is ready to make very painful concessions in this peace deal, it is the Palestinians that have been blocking the peace process. He also maintained that Jerusalem will not be divided and that Israel will not make large concessions on its security or on the borders of a future Palestinian state.

A great deal of attention has been paid to a very specific line in Obama's speech from last week, where he said the borders of Israel and Palestine will be based on the lines of 1967 with mutually agreed swaps. This was portrayed by much of the media as a major U.S. policy shift and led Netanyahu to declare to the Israeli lobby in Washington that those 1967 borders are indefensible.

There is absolutely nothing groundbreaking in what Obama actually said. The 1967 lines refer to the borders before the 1967 Six-Day War, when Israel captured the Gaza Strip from Egypt, the West Bank and East Jerusalem from Jordan, the Golan Heights from Syria, and basically went beyond the border outlined in the 1949 armistice between Israel and Arab states.

Obama is not saying that the 1967 lines will be the exact same borders of a two-state solution; he is saying negotiations need to be held for those mutually agreed swaps that would deal with the very contentious issues of East Jerusalem and West Bank settlements. Obama said he was explicit in what he meant, but no matter which way you look at this issue, this is an issue that remains very much clouded in controversy. The only new aspect to Obama's roadmap for peace was perhaps the urgency in which he is conveying his message. This does not change the fact that Israel is very unlikely to make significant concessions to the Palestinians, especially at a time when the Palestinians are in a fledgling unity government that includes Hamas, which refuses still recognize Israel's right to exist. As Netanyahu put it, he declared Hamas the Palestinian version of al Qaeda and called on Fatah to rip up its agreement with Hamas if it wants to negotiate seriously with Israel.

Now, the biggest challenge to the Israeli-Palestinian conflict lies in the surrounding environment to the conflict itself. Egypt is undergoing a very shaky political transition, and the military regime there is also trying to keep a lid on Hamas in the Gaza Strip. Jordan meanwhile is facing much higher levels of political pressure from its Islamist opposition, and the Syrians are throwing all of their effort into putting down a country-wide uprising. Meanwhile, the threat of a third Palestinian intifada continues to loom.

The past 33 years of Israeli history have been largely quiescent, for Israeli standards. Now, Israel faces threats on nearly all of its frontiers. Obama argued that this very uncertainty in the region is exactly why Israel cannot afford to delay the peace process any longer, and why both Israel and the United States should avoid ending up on the wrong side of history, as he put it. This is a point that Israel will likely strongly disagree with. It also brings up a much more important question, one that we addressed in this week's "Geopolitical Weekly," of whether there really is a true "Arab Spring" capable of bringing about democratic revolutions that would be friendly to U.S., much less Israeli, interests.

Meanwhile, as Netanyahu emphasized in his speech, a big focus for Israel, and what arguably should be the focus for the United States, concerns Iran, where the United States has yet to devise and effective strategy to counterbalance the Iranians that are waiting to fill a power vacuum in Iraq following the U.S. withdrawal. That remains a key point the Obama presidency must address, and it is largely one that is ignored by the effects of the Arab Spring.