Fixing Palestine

In 1995 and 6 I led IMF technical assistance teams to Israel to establish the Palestine Monetary Authority as called for by the Oslo Accord. We were excited by the prospects of contributing to peace between the Arab and Jewish populations who had occupied the area for millennia (as well as new arrivals). We spoke, as did many others, of the Oslo Peace Process establishing a two-state solution to the struggles between the Palestinians and Jews since the establishment of Israel in 1948. In fact, we should have referred to the Oslo Accords as establishing only a step, a rather small one at that, toward a two-state solution—two independent states following Israel’s occupation of the West Bank and Gaza Strip in 1967.

I wrote about these experiences in “Palestine-The Oslo Accords Before and After-My Travels to Jerusalem” Our work was greatly facilitated by the fact that the governors of the Bank of Israel, Stan Fischer, and of the newly created Palestine Monetary Authority, George Abed, had been IMF colleagues. I asked each if they would write the foreword to my book. Stan declined saying that it was too sensitive a topic and George declined saying that my book was unfair to the Palestinians.

I have just finished reading a new account of the efforts to find peace in the area by two insiders with much wider exposure than I had had:  “Tomorrow is Yesterday-Life, Death and the Pursuit of peace in Israel/Palestine” by  Hussein Agha and Robert Malley. And I concluded that George Aben had been right about my account.

The two authors had been intimately involved in the many efforts to find agreement between the relevant parties. Drawing on their experience advising the Palestinian leadership (Arafat and Abbas) and US presidents (Clinton, Obama, and Biden) and their participation in secret talks over decades, Agha and Malley expose the weaknesses of those efforts and point to the potential of a very different approach. “They stress that the two-state solution became a global goal only when it was no longer viable; that U.S. officials preferred technical schemes to a frank reckoning with the past; that Hamas’s onslaught [on Oct 7, 2023] and Israel’s war of destruction were not historical exceptions but historical reenactments; and that the gaps separating Israelis and Palestinians have less to do with territorial allocation than with history and emotions.” From Amazon Books website.

Robert Malley was the United State Special Envoy for Iran in 2021-23 and as Special Assistant to President Clinton from 1998 to 2001, he was a member of the U.S. peace team and helped organize the 2000 Camp David Summit. Hussein Agha, a Lebanese, is a senior associate of Oxford University’s St. Antony’s College was a senior associate fellow at Chatham House.

Malley and Agha stress the diversity of players in the search for peace—ultra orthodox to nonreligious Jews—Palestinian groups that spent more energy fighting one another than fighting Jews. Selecting Israeli prime minister Ehud Barak and Palestinian Authority chairman Yasser Arafat for US lead negotiations at the Camp David summit left out most groups and many relevant issues. The authors end with the somewhat encouraging call to return to the beginning (1948 and before) and seating all Jewish and Palestinian groups at the table to take on the fundamental issues of history head on if there is any chance of finding the compromises needed to live together in peace with one, two, or more states as options.  https://wcoats.blog/2024/01/19/one-state-solution-for-palestine-israel/   Their narrative is a very enlightening account. 

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Author: Warren Coats

I specialize in advising central banks on monetary policy and the development of the capacity to formulate and implement monetary policy.  I joined the International Monetary Fund in 1975 from which I retired in 2003 as Assistant Director of the Monetary and Financial Systems Department. While at the IMF I led or participated in missions to the central banks of over twenty countries (including Afghanistan, Bosnia, Croatia, Egypt, Iraq, Israel, Kazakhstan, Kenya, Kosovo, Kyrgystan, Moldova, Serbia, Turkey, West Bank and Gaza Strip, and Zimbabwe) and was seconded as a visiting economist to the Board of Governors of the Federal Reserve System (1979-80), and to the World Bank's World Development Report team in 1989.  After retirement from the IMF I was a member of the Board of the Cayman Islands Monetary Authority from 2003-10 and of the editorial board of the Cayman Financial Review from 2010-2017.  Prior to joining the IMF I was Assistant Prof of Economics at UVa from 1970-75.  I am currently a fellow of Johns Hopkins Krieger School of Arts and Sciences, Institute for Applied Economics, Global Health, and the Study of Business Enterprise.  In March 2019 Central Banking Journal awarded me for my “Outstanding Contribution for Capacity Building.”  My recent books are One Currency for Bosnia: Creating the Central Bank of Bosnia and Herzegovina; My Travels in the Former Soviet Union; My Travels to Afghanistan; My Travels to Jerusalem; and My Travels to Baghdad. I have a BA in Economics from the UC Berkeley and a PhD in Economics from the University of Chicago. My dissertation committee was chaired by Milton Friedman and included Robert J. Gordon. I live in National Landing Va 22202

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