Dollars and Diplomacy: The Impact of U.S. Economic Initiatives on Arab-Israeli Negotiations

The U.S. government spends on the order of $5 billion a year in an effort to promote Arab-Israeli peace, not to speak of untold hours of diplomats' and politicians' time and many other exertions. Has all this effort paid off? Before replying, Clawson and Gold point out that the great majority of Middle Easterners disagree with the implied assumptions that lie behind the economic dimension of this effort (namely, that being better off makes it easier to make politically difficult decisions; and that economic cooperation probably will lead to political cooperation). Far from wanting their opponents to prosper, people in the region (quite instinctively) fear that more wealth will make them a more formidable enemy. Or, as the authors memorably put it (playing off of Shimon Peres's quip), Middle Easterners fear "banks as much as tanks."

Clawson and Gold cautiously endorse the American approach, calling efforts to build prosperity and regional cooperation "useful." In the same breath, however, they emphasize the need for "a sense of proportion" in what to expect of economic incentives. "In the Middle East, politics does come before business, but business can help to reinforce politics." If Americans keep in mind the obvious limitations of economics, cooperation in this realm can help promote prosperity and people-to-people contact, positive ends in their own right, even if they do not lead to grand diplomatic breakthroughs.

Although the authors offer a sophisticated and sensible critique of U.S. outlook and policy, it may be that, at least in the Middle East, the nasty gut instinct of the locals (kick your opponent when he's down) is ultimately more on target than the good-willed American approach (help him up, remake him). In any case, the years ahead will provide ample opportunity to discover who understands the region better.

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