Settlement Freeze Redux*

Israel’s ever-expanding network of civilian settlements in the occupied territories is viewed by its partisans and opponents alike as the most significant obstacle to the creation of a viable, sovereign Palestinian state. Palestinian Authority chairman Mahmoud Abbas is conditioning a renewal of discussions with Israel on an Israeli commitment to freeze all settlement, echoing a demand originally made in 1992 during the pre-Oslo Washington talks.

“We consider settlements to be a central issue,” explained Palestinian delegation leader Haidar Abdel Shafi in a January 1992 memorandum, “and if there is no cessation of the settlement process, that practically means there is no peace process.”

An Israeli commitment to a settlement moratorium is viewed by proponents as a necessary demonstration of good faith toward a diplomatic process leading to an end to occupation and the creation of secure and recognized boundaries for two states—Israel and Palestine. Yet, for more than three decades, on again off again promotion of a settlement freeze by the U.S. has failed to slow settlement expansion, thereby undermining the credibility of U.S. diplomacy. More often than not, attempts to establish a freeze resulted in U.S. support for settlement expansion, most notably the Clinton administration’s endorsement of the “natural growth” of settlements.

Settlements must be evacuated as part of a final status plan that establishes Palestinian sovereignty and enhances Israeli security, but to do so will require a degree of commitment—not to a freeze in settlements but to their removal—that neither Israel nor the international community has yet been able or willing to muster.

The administration of President Barack Obama is considering resurrecting the freeze idea as a key element of its policy. Israeli prime minister Benjamin Netanyahu has signaled his opposition, noting that, “if Israelis cannot build houses in the West Bank, Palestinians do not need to build either.”

U.S. officials believe that despite the failure of all previous attempts to freeze settlements, the idea still has merit. But achieving the goal of peace and security for both Israelis and Palestinians requires a strategy rooted in historical experience and the vital requirements of both peoples. A settlement freeze falls short of this standard. Settlement evacuation, not a freeze, is a more credible and necessary objective, more closely attuned to the essential long-term interests of both parties and firmly rooted in past Israeli practice, most recently in Gaza. Placing a freeze at the center of a U.S. diplomatic effort that calls for confidence-building measures from all parties invites failure, and risks eroding the credibility of a much-anticipated U.S. effort to end the conflict. The only context in which a freeze could be implemented is as a consequence of an Israeli decision to remove settlements and the Israeli army from occupied territory. The history of the last 40 years suggests that if Israel makes such a momentous decision, freezing settlements becomes moot.

A Settlement Freeze Is Far More than a Confidence-Building Measure

A cessation of settlement requires Israel to repudiate the linkage between settlement, security, and sovereignty that is at the heart of its defense and settlement doctrine in the occupied territories. Neither Israelis or Palestinians see an Israeli implementation of a freeze as a mere confidence-building measure, but as a precursor to settlement evacuation, marking a radical reversal of Israel’s core security, political, and ideological principles.

Moreover, a freeze as currently understood does not address the symbiotic relationship between settlements and security at the heart of Israel’s policy of occupation and settlement. It assumes that settlements can be addressed while ignoring the broader security framework in which they exist. If the Obama administration is committed to ending the conflict, promotion of a freeze is of less consequence than a forthright initiative to create a new security framework that protects legitimate Israeli and Palestinian national security interests and that ensures the removal of settlements and an Israeli military withdrawal from the occupied territories.

In order to comply with the requirements of an effective settlement freeze, Israel will have to undo the system by which the military establishment, the legislative and executive arms of the state, settlers, and public, private, and supranational communal organizations collaborate in the encouragement and expansion of settlements. Laws empowering individuals and private and public bodies to increase settlement will need to be reformed, and military orders must be rescinded and new ones issued. Major elements of national legislation and administrative practice that have devolved planning and budgetary power to settlements will have to be undone, as will the host of decisions taken by representative settlement councils. Powers of taxation, planning, courts, and construction will require radical revision to reflect the requirements of a freeze as will the complex system of material and budgetary incentives granted to individuals and business enterprises to encourage settlement expansion.

The requirements necessary for an effective settlement freeze reveal an undertaking so complex and requiring an Israeli political decision so profound that no Israeli government would undertake except as a result of a broader decision to terminate occupation.

Evacuation, Not a Freeze

It is important to recognize that, as Abdel Shafi warned in 1992, the credibility of the Oslo process was undermined not only by the working assumption of the U.S. and Israel that peace and settlement expansion were compatible. It also suffered because Israel refused to meet even modest U.S. benchmarks regarding settlement expansion and removal of new settlements, and it received no penalty for its failure do to so.

The re-creation of a diplomatic process based in part on an Israeli commitment to a freeze would soon be undermined if Israel failed to comply. Moreover, Israelis may well believe that a renewed U.S. initiative that centers on a freeze can, like all previous efforts, be exploited to consolidate settlements and the occupation rather than progress toward an agreement requiring settlement evacuation. Were Israel to engage Washington in negotiations on the parameters of a freeze, it may well signify a prescription for stalemate rather than an expression of goodwill.

The Begin-Carter Settlement Freeze

The freeze idea was born at a time when settlement expansion was in its infancy. Israel had occupied the West Bank for hardly a decade, and with the exception of East Jerusalem, settlements claimed only small numbers of inhabitants; most had yet to shed an air of impermanence. There were less than 5,000 Israelis living in less than 30 West Bank settlements. The settler population in East Jerusalem numbered 50,000. Administration of all settlement-related activities in the West Bank and Gaza Strip was largely controlled by the Israel Defense Forces (IDF), and the integration of settlements and settlers into the routine bureaucratic life of Israel’s civilian ministries was still some years off. In this era, marked by the election of Menachem Begin in 1977, there was a legitimate basis to view a cessation of settlement as a confidence-building measure.

In a letter to President Jimmy Carter delivered after the September 1977 Camp David summit, Begin offered a three month moratorium on establishing new settlements rather than the longer moratorium preferred by Washington. Restrictions on the expansion of existing settlements had been dropped at Israel’s insistence. On the face of it, Begin’s agreement to halt new settlement creation for even three months was a bold and surprising concession. Yet, and not for the last time, Israel’s commitment to a moratorium did not constrain settlement but rather established categories of expansion implicitly endorsed by Washington. The temporary moratorium on new settlements notwithstanding, the Begin government continued to “thicken” and “strengthen” settlements, at times establishing new sites kilometers away from existing colonies during the three month period. Carter administration officials were frustrated by Israel’s actions, but acquiesced.

In contrast to Begin’s agreement to the partial, temporary, and ineffective restrictions on Israeli settlement actions in the West Bank and Gaza—East Jerusalem was excluded implicitly—the peace treaty with Egypt signified a strategic Israeli decision to trade territory for new security mechanisms that required Israel’s evacuation of all settlements in territory returned to Egyptian sovereignty. Only in the context of an Israeli decision to withdraw from Egyptian territory was it possible for Israel, through its complete evacuation of the Sinai Peninsula, to adopt and enforce an effective halt to settlement expansion. Indeed Israeli settlement activity in Sinai increased in the months before evacuation until the IDF forcibly removed the Sinai settlers. Settlement activity undertaken within the strategic context of imminent evacuation proved to be irrelevant.

Settlement Freeze Reborn: The Oslo Years

Baker-Bush I

The emigration of Jews to Israel after the implosion of the Soviet Union, and the Madrid diplomatic process that followed the 1991 American victory in the Gulf War, returned the issue of a settlement freeze to the U.S.-Israel diplomatic agenda. The freeze idea was raised by President George H. W. Bush without success in the context of a U.S. agreement to provide loan guarantees to Israel during the 1990–1992 period. The idea was also prominent among the confidence-building measures sought by Palestinians before and after the Madrid conference. In neither context was the concept incorporated into subsequent agreements, nor did its appearance as an issue on the negotiating and bilateral Israeli-U.S. agenda prove an effective instrument for formally or informally constraining settlement expansion.

The Bush administration called on Israel to stop construction in new or existing settlements with increasing frequency after the beginning of Secretary of State James Baker’s diplomatic initiative in March 1991. Presaging ideas currently being considered by the Obama administration, Baker at one point suggested that a settlement freeze would be reciprocated by a cessation of the Arab economic boycott of Israel. During the October 1991 Madrid conference, Baker broadened the proposal to include an end to the Palestinian intifada as well as U.S. provision of the loan guarantees in return for a temporary settlement freeze.

The Baker offer reflected a lack of American understanding of two issues vital to the proposed deal. First, the boycott of Israel, both primary and secondary was, by that time, ineffectual. Second, and more important, the offer illustrated Baker’s failure to comprehend the centrality of the settlement enterprise to the Shamir government.

“Once the government of Israel accepts any kind of freeze,” explained Shamir aide, Yossi Ben Aharon, “it violates a very basic principle in its policy—the right of Jews to live in any part of this land west of the River Jordan.”

If Israel were to concede what in effect it considers its national birthright, it would demand a quid pro quo far more substantial than an end to the feeble boycott or even, as the Palestinians suggested, an end to the intifada. The offers of such a lopsided bargain—and they weren’t the last ones—invited rejection. Shamir did not take the U.S. proposal to stop settlement seriously. It was, he remarked, “merely the expression of a wish.”

A similar conceptual disconnect is apparent in the road map. The plan’s sequencing suggests that the major penalty to be paid by Israel for failing to freeze settlements—the elements of which remain undefined—is to postpone the creation of a Palestinian state with provisional borders. This is a “penalty” the current government of Israel would welcome.

Rabin Builds

In the wake of the 1992 election of Yitzhak Rabin, the Bush administration’s demands for a settlement freeze were transformed into a two-tiered and somewhat contradictory policy of exacting decreasing and largely illusory financial penalties for settlement expansion—associated with the provision of $10 billion in loan guarantees—while formally acknowledging, for the first time, Israel’s right to expand settlements, according to the undefined requirements of their “natural growth.”

In the wake of his August 1992 agreement with President Bush to expand settlements according to this standard, Rabin sought to dispel the impression that the agreement with Washington meant that Israel had imposed a settlement “freeze.”

Look, I do not know what you mean when you say settlement freeze, when we are talking of the continued construction of 11,000 units in the territories. . . . Let us keep things in proportion. I am not happy with the situation, but I found . . . that we cannot practically cancel the construction of more than 6,000 to 7,000 housing units that were planned before, and for some of which initial ground-breaking work had begun. The construction of 11,000 units continues, nonetheless. Is this a freeze?

Soon thereafter, the Bush administration proposed legislation to grant Israel $10 billion in loan guarantees over five years. Absent was any reference to earlier demands for a cessation of settlement. In its stead, the president was empowered, beginning with the second annual disbursement of guarantees, to impose a dollar-for-dollar penalty “for activities which the President determines are inconsistent with the objectives of this section [resettling immigrants, infrastructure, housing, and ‘other purposes’] or understandings reached between the United States Government and the Government of Israel.” As a consequence of this legislation, Israeli expenditures for civilian settlement expansion were deducted in progressively smaller amounts from the loan guarantees made available by Washington.

These sanctions failed to produce a meaningful change in settlement expansion or to prompt a change in Israeli settlement policy. U.S. support for the “natural growth” of settlements became official policy, further eroding Washington’s long-standing opposition to settlements as an obstacle to peace. Loan guarantees were provided, and the mechanism employed to determine Israeli expenditures on settlements segregated large parts of Israel’s settlement budget from penalty. The principles established by this process were not related in any fashion to an effective cessation of settlement but rather centered on (virtual) financial penalties exacted for some settlement-related investments. With the exception of the establishment of new settlements, which Rabin opposed for his own reasons, settlement expansion continued apace. Beginning in 1996 the establishment of new settlements—euphemistically known as “outposts”—was renewed.

During the rest of the decade the freeze idea became on various occasions an element of bilateral discussions between Jerusalem and Washington. The U.S. engaged in fruitless discussions with the first Netanyahu government to establish that there would be “no substantial expansion” of settlements. Prime Minister Ehud Barak rebuffed criticism of his expansion efforts, explaining that the imminent conclusion of a final status agreement with the Palestinians would resolve the issue.

The Mitchell Committee

The settlement freeze and evacuation recommendations made in 2001 by the Sharm el-Sheikh Fact-Finding Committee (Mitchell Committee) challenged a number of assumptions at the heart of Israel’s settlement strategy. By establishing a cessation of all settlement activity, including the provision for natural growth agreed to by the Clinton administration, as a key element in constructing a viable diplomatic process, Mitchell contested Israel’s power to define the terms under which diplomacy would be conducted. In a letter to President George W. Bush opposing a settlement freeze and its linkage to the second Palestinian intifada, Prime Minister Ariel Sharon wrote that it would be impossible to grant to PA chairman Yasser Arafat, as a consequence of violence, a prize that he failed to receive from any Israeli government during a decade of negotiations.

The Mitchell recommendations repudiated a key assumption of the Oslo process—namely, that settlement expansion and progress toward peace could proceed in tandem. The commission acknowledged a key Palestinian claim that settlement growth undermines the prospects for Palestinian sovereignty. As the Palestinians had long argued, it viewed an effective settlement freeze as a necessary confidence-building measure required from the outset of negotiations, even those conducted during the interim period before final status talks began.

Furthermore, the Committee sought to disaggregate Israeli security from settlement expansion. Implicit in this suggestion, at odds with Israeli security doctrine, was a challenge to Israel’s ability to unilaterally determine its security requirements in the occupied territories. Indeed, it suggested that settlement expansion endangered Israeli security.

Mitchell also called upon Israel to consider evacuation of some settlements. Within the committee there was minority support for the evacuation of all settlements in Gaza.

Israel deflected Mitchell’s call for a freeze. In a May 15, 2001 official comment on the his report, Sharon noted,

[T]he question of the settlements is a matter that, together with, principally, Jerusalem, refugees, and borders, has specifically been agreed by Israel and the Palestinian side as one for treatment in the permanent status negotiations. There is nothing in the bilateral agreements between the two sides that suggests that the question of settlements is to be regarded as one that could be separated from the others and unrelated to the overall solution of those other problems. Indeed, the Committee itself noted that the issue of settlements is one of the core issues to be negotiated between the sides. The outcome of such negotiations, in which each side has legitimate positions and claims, should not be prejudged. On the substance, it must be recalled that it is already part of the policy of the Government of Israel not to establish new settlements. At the same time, the current and everyday needs of the development of such communities must be taken into account.

Foreign Minister Shimon Peres went a step further, explaining shortly after publication of the Mitchell report,

[A] freeze is already in effect. Actually, a freeze is only the third stage of the Mitchell plan—first comes a cease-fire, then a cooling-off period, then confidence-building measures, such as freezing settlements—such that there is nothing to even talk about regarding such a freeze until six weeks after it begins. But in practice, the coalition negotiations stipulate that there be no new settlements, and we also agreed that there would be no land-expropriations to expand existing settlements, and then we added a third thing, to which the government, Mr. Sharon, agreed, and that is that there be no new construction outside the built-up areas within the existing towns—such that in practice, there is a freeze on construction in Yesha.

The Mitchell Commission’s call for a settlement freeze was ambiguous and incomplete. There were no details about the elements of a freeze—its geographic scope, duration, methodology, oversight, monitoring and assessment mechanisms, or penalties for infractions. Discussion on some of these issues was considered by the Bush administration and the Sharon government—centering on defining approved (by Washington) buildable areas for each settlement—but never initiated.

Mitchell’s call for a freeze was incorporated in the 2003 road map, which also called for the evacuation of new settlements created after (but not before) March 2001, now numbering around 50. Israel endorsed the road map, including the freeze and outpost provisions, noting however, that ‘there will be no involvement with issues pertaining to the final settlement. Among issues not to be discussed: settlement in Judea, Samaria and Gaza (excluding a settlement freeze and illegal outposts).”

On May 12, 2003, it was reported that Prime Minister Sharon had rejected a settlement freeze as “impossible” due to the need for settlers to build new houses and start families. Sharon famously challenged Secretary of State Colin Powell, saying, “What do you want, for a pregnant woman to have an abortion just because she is a settler?”

Gaza Evacuation

Sharon’s bold decision in 2004 to “redeploy” from the Gaza Strip, removing all permanently stationed IDF forces, and evacuating all 7,500 settlers, like the Sinai evacuation 25 years earlier, reaffirmed the notion that settlement evacuation rather than a freeze can be a more effective alternative to occupation. The decision to evacuate Gaza’s 17 settlements was made in the context of a new Israeli security paradigm for Gaza. Sharon believed that Israeli security could be enhanced through withdrawal, redeployment, and settlement evacuation. Freezing settlements simply had no place in the new policy. Indeed, settlements continued to be expanded, often with government support, almost until the day of evacuation.

Facing the Future

If the Obama administration pursues a settlement freeze will it want to undertake the onerous task of negotiating with Israel the mechanisms required to define, implement, police, evaluate, and if, necessary impose sanctions for infractions? In order to avoid this, Washington, echoing the Mitchell committee recommendations, might opt for a declaration that Israel cease settling without engaging Israel in defining a freeze. The U.S. may even impose sanctions more severe than those associated with the loan guarantees in response to an Israeli failure to heed Washington’s demand. There is a seductive appeal to these policy options. They build upon past efforts and they have an intuitive appeal. After all, if settlements are a problem does it not make sense to stop building and expanding them? Even in the unlikely event that a freeze succeeds, settlements will remain. The urgency of the situation and the failure of all previous efforts to freeze settlements point to the conclusion that U.S. policy should focus, for the first time, on removing settlements, defining the border between the states of Israel and Palestine, creating new security mechanisms, and ending the conflict.

“I can see a freeze for three or six months, maybe, for the duration of the talks,” explained Israel Harel, a founder of the settlement movement and a resident of Ofra near Ramallah. “It won’t be implemented, but sabotaged. In Ofra we won’t stop [building], well maybe for a week or two.”

*Portions of this article first appeared in “The Israeli-Palestinian Roadmap: What a Settlement Freeze Means and Why it Matters,” International Crisis Group, Middle East Report N̊16, July 25, 2003.