After nearly 60 years, Israel is still not at peace with most of its neighbors. The Saudi peace plan, first proposed in 2002, is the latest in a series of Arab overtures aiming to end this situation. It offers Israel full normalization of relations in return for withdrawal from the territories it conquered in 1967, and a negotiated agreement on the right of return for Palestinian refugees. Israel ignored the plan in 2002, but this year the Arabs have re-presented it more forcefully. In July two Arab League envoys visited Jerusalem to press the Arab case, and plans led by the United States are afoot for an Arab-Israeli peace conference in September. Though Israel may still not respond, this is a giant step for the Arabs, reversing decades of hostility.

King Abdullah, then Crown Prince, presenting the Saudi peace plan, first proposed in 2002 in the Arab Summit in Lebanon

The West viewed the plan as no more than a proper Arab response to Israel’s existence, revealing a profound ignorance of what the plan means for Arabs. Westerners regard Israel as a natural part of the Middle Eastern landscape and dismiss what Arabs feel about it. Yet an understanding of Israel’s impact on the Arab world has always been crucial to the search for a resolution to the conflict, and helps explain why none has yet been found.

The damage done to the Arabs by Israel’s creation is an untold story in the West. To understand it, you have to set aside the Israeli narrative and the idea of Arabs as fanatical, backward warmongers irrationally bent on destroying a modern, democratic and peaceable state.

For the Arabs, Israel’s presence in their midst has been disastrous. It has led to six major wars, forced them to militarize when they could not afford it, distorted their development, split their ranks and encouraged their fragmentation into ethnic and religious minorities, provoked the rise of Islamic fundamentalism and reared generations of young Arabs on conflict, hatred and hostility. It has forced them to host a state that dominated them and ensured continued Western hegemony in their region. A disproportionate amount of damage was borne by the frontline states of Jordan, Syria, Lebanon and Egypt. But now Iraq and the rest of the Arab world are affected, as is Arab society in general.

On each visit to the Arab world I am struck by its immense resources and its varied geography, history and customs, from Yemen to the Levant, sweeping through Egypt and Sudan to its westernmost point in Morocco. Such diversity could have made this the wonder of the world, physically beautiful, self-sufficient and wealthy. Instead, it is backward, poor and divided. This is not all Israel’s fault, but its existence has contributed significantly to the Arabs’ decline, and ignoring Israel’s role in the story would be misleading.

In 1948 the Arab world was confronted with the new and alien creation of Israel. Its governing ethos was European and so were most of its people. As such, Arabs could neither understand nor deal with it. They were powerless to prevent Israel’s creation and too weak to defeat it in the war that ensued. Their ill-trained, smaller armies stood little chance against the highly motivated, trained and better equipped Israeli forces. But this made no difference to the Arabs’ sense of failure, unable to protect the Palestinians from dispossession or halt Israel’s expansion in the region. “The problem is not that Israel is so great,” an Israeli friend once told me, “but rather that it’s a mirror in which the Arabs see their own weakness.”

The western powers’ implicit contempt for the Arabs’ wishes only worsened the situation. Few realised the true extent of western support for Israel, unrivalled in the region, and how, without it, the Zionist experiment might have ended before it began.

The devastating and continuing effects of Israel’s establishment on the Palestinians are well documented, but they were not alone in paying the price for Israel’s creation. The Arab world was transformed by its imposition. No other event there since world war one has been so cataclysmic. There has not been a decade since 1948 when Israel has not been in combat with its neighbours. This has damaged the political process in the Arab world, which has come to depend on its army generals for leadership and to admire military strength and violence.

The UN’s Arab Human Development Report in 2002, which revealed the extent of the Arabs’ retardation, was clear that Israel’s occupation had affected the region’s political and economic life, and that the Arab-Israeli conflict was “a major impediment to human development in the region”. This is hardly surprising. The Arab states, struggling with post-independence when Israel was established, should have focused on their own political and social development. Instead, the frontline states were dragged into wars that diverted their resources into armaments and surveillance. After each defeat, they were forced to re-arm ever more extravagantly.

Arab military spending in the late 1990s accounted for 7.4% of GNP (three times the world average of 2.4%). Since then it has grown by an annual 5%. As Israel acquired sophisticated arms from the United States, Arab states were pushed into trying to keep up at increasing expense, although the arms the Arabs bought from the U.S. and Britain needed the sellers’ technical assistance for operation. These sales were thus designed to benefit Western arms industries rather than help the Arab states protect themselves against aggression.

The continuing conflict has discouraged foreign and domestic investment in Arab states and led to a migration of skilled labor, further impoverishing local economies; in particular, it has exhausted and weakened the frontline states. Their economies have been grossly distorted towards militarization at the expense of social and economic development. In 2002 average Arab expenditure on health and education combined was only 3.7% of GNP. Yet the Arabs had no choice but to militarize against what they saw as an expansionist Israel bent on taking their land. Israel did not set its borders with Egypt until the 1979 peace treaty and has still not done so with Syria or Lebanon.

Disunity and unrest

Today’s Arab world is riven by sectarian strife and factionalization. Disunity, unrest and breakdown on ethnic and religious lines have increased since 1967. Israel’s role in this was a logical way to weaken its enemies and enhance its regional hegemony. Prominent Israeli figures explicitly propounded this strategy from the 1950s. David Ben-Gurion, Israel’s first prime minister, had a vision of a reorganized Middle East with Jordan divided into an east bank as far as Iraq (to accommodate Palestinian refugees) and a west bank joined to Israel. Ariel Sharon, architect of the 1982 Lebanon invasion, embellished this with his plan for a forced exodus of West Bank Palestinians into what remained of Jordan. Lebanon would be split into a Muslim south annexed to Israel; the rest would be a Maronite Christian entity.

From the 1950s Israel tried to encircle the Arab world by creating links with a network of non-Muslim, non-Arab countries, especially those opposed to pan-Arabism and in some cases, Islam. It sought to neutralize or win over non-Arab states that supported the Arab cause. It cultivated clandestine contacts with pre-Khomeini Iran, and maintained them after 1979, supplying weapons to Iran during its war with Iraq. It also established ties with Turkey, Ethiopia and the Christian south of Sudan.

Israel’s alliances with non-Muslim and non-Arab minorities within the Arab states were designed to disrupt internal cohesion. Israel cultivated the Maronites in Lebanon, for example, and its constant internal interference has destabilized the country. The long occupation of the south, 1982-2000, scarred its economic and social life. The massive Israeli attack on Lebanon in 2006 was an opportunity to fragment the country further, destroy the only effective anti-Israel force, Hizbullah, and revive Israel’s aim of establishing a friendly Lebanese government.

It is not surprising that Arabs see the U.S.-led occupation of Iraq in 2003 as a fulfilment of Israel’s wish to destroy every strong Arab state. With Egypt neutralized by the 1979 Camp David agreement, Iraq, the next potential threat to Israel, was the obvious target. There is now a real possibility of Iraq fragmenting into Shi’a, Sunni and Kurdish areas. Israel prepared for this by supporting Kurdish rebellions against the central government during the 1960s and 1970s. After the U.S./U.K. invasion of 2003, Israeli operatives funded and trained Kurdish fighters for intelligence gathering in Iran and Syria (next on the list of states to be destroyed or broken up). It is said that Israel used this intelligence to assassinate Shi’a and Sunni insurgency leaders in Iraq. In 2004 it was complicit in stirring Kurdish protests against the Syrian government, using Iraqi Kurdish operatives.

Israel was also implicated in Iraq through the neoconservative group advising President George Bush: Members of this group, sympathetic to the rightwing Israeli Likud Party, had been agitating for regime change in Iraq since 1995, arguing that ousting Saddam Hussein was the key to transforming the balance of power in the Middle East in Israel’s favor. The neocons’ principal concern was to destabilize Israel’s enemies. Removing the Iraqi regime was the essential first step, with Syria and Iran to follow. They realized that only U.S. backing for such an enterprise could ensure its success, and found a willing partner in the Bush government.

Separate deals

In Israel’s drive to disrupt the Arab front, it has worked hard to make separate deals with Arab states (Egypt in 1979, the PLO in 1993, Jordan in 1994). Contacts have also been made in the last decade with Morocco, Tunisia, Mauritania, Qatar and Bahrain. This has widened the gap between Arab governments and their peoples, since there is no popular acceptance of Israel in any of these states.

Israeli and Saudi officials are also reported to have met to discuss the Iranian threat to both countries, though the Saudis denied it. The current division between Sunnis and Shi’a, and between “moderates” (Egypt, Jordan and Saudi Arabia) and “extremists” (Syria, Hizbullah and Hamas), is meant to fragment the Arab world into camps for and against Israel. In Palestine, the split between Fatah and Hamas, encouraged by Israel, is a devastating example of this.

Though not responsible for the establishment of the Muslim Brotherhood in Palestine in the 1940s, Israel tacitly encouraged it after 1967. By turning a blind eye to Palestinian fundamentalist movements and using them as a counterforce to the nationalist PLO, Israel allowed them to become fully established and armed. Most Palestinians were not fundamentalist, but since the second intifada in 2000, the failure of the Oslo Accords and the collapse of secular resistance, Islamists have won support for their uncompromising opposition to Israel. This accounts for the Hamas victory in the Palestinian elections in 2006.

Generations of young Arabs reared on hostility towards Israel have helped the growth of radical groups opposing Israel and its backers. Recruits for al-Qaeda did not spring fully armed from nowhere. Al-Qaeda’s doctrine that Palestine is a sacred Muslim land has begun to find a sympathetic following among some Palestinians in Gaza, which is changing the Palestinian struggle from nationalist to Islamic: far more dangerous if it becomes a part of the shift towards political Islam sweeping the region, convulsed by anger at the United States and its support for Israel.

Suicide bombing is a late and ugly manifestation of Palestinian reaction to Israel. Its Islamic aspect arose as Arab nationalism, weakened by decades of Western support for Israel, was replaced by religion as a primary intellectual motivation. That a peaceable, agrarian and family-centered people should accept the sacrifice of its young in the struggle against Israel is eloquent evidence of the way it has been damaged.

This does not mean that without Israel, the Arab world would have had an untroubled history; Israel often only aggravated or exploited what was already there. The ground for the divisions in the Arab world had been prepared by the major European powers at the end of World War One. By creating borders and nation-states where none existed, they sowed the seeds of future discord. The imposition of Israel in this setting was just the most flagrant example of the same imperialist policy.

Israel’s powerful Western sponsors are committed to its security, irrespective of the cost to the Arabs, who are hamstrung by political weakness and dependence on Western favor. How can that be dealt with? Neither war nor peace has solved this predicament, and the Arabs have ended with unsatisfactory and uneven arrangements, characterized by resignation and impotence. The Saudi peace plan represents an acknowledgment of this reality, but also of Israel’s stunning success in imposing its own terms without having compromised. However the plan fares, it is a landmark in the historical evolution of the Arab world from outrage and hostility to accommodation and acceptance, even if grudging. Whether it will be the end of the story remains to be seen.

Ghada Karmi is research fellow and lecturer at the Institute of Arab and Islamic Studies, University of Exeter, and author, most recently, of “Married to Another Man: Israel’s Dilemma in Palestine,” (Pluto Press, London and Ann Arbor, 2007). © 2007 Le Monde diplomatique.