Diminishing Returns

This process will show that the Israel lobby, while influential, is not dictating US policy. This theory has been a popular one, but it has always risked underplaying the self-interest of the United States. Rather than being pulled along grudgingly, with the tail wagging the dog, the opposite is and has been the overriding dynamic: the US has invested in Israel as a garrison for securing its imperial objectives in the Middle East. As Joe Biden said in 1986: “[Supporting Israel] is the best $3 billion investment we make. Were there not an Israel, the United States of America would have to invent an Israel to protect her interests in the region.”

Biden’s thinking made sense for that phase of US imperialism, but this approach is now being challenged as this asset depreciates and, indeed, becomes a liability. Simply put, the region demands stability as multipolarity takes effect, and the Gulf states want authority in this field. The United States also prefers a reconfiguration that can protect its financial and long-term strategic interests, having accepted that endless military interventions in the Middle East prove deleterious. As the US prepares for escalating competition with China, it seeks a resolution in which its objectives can be flexed commercially through Gulf collaborators against a backdrop of regional integration.

This is why they have accelerated talks with Iran, and why it is likely Iran will agree to a deal. In addition, the United States has concluded hostilities with the Houthis and, quite remarkably, without Israeli support or coordination. As mentioned above, they have also engaged in direct talks with Hamas, much to the ire of the Israeli cabinet. On his recent tour, Trump conducted high-level talks with representatives from several key states in the region, but not Israel. The USS Harry S. Truman aircraft carrier has since left the Red Sea, with three fewer fighter jets. It is little wonder that Netanyahu grasps that Israel will need to “wean ourselves off US military aid.”

As interests reposition, the United States is also coordinating with the Saudis on the nature and implementation of a lasting cease-fire in Gaza — a difficult and messy process, as disentanglement generates its own dilemmas. This is partly why one day a report will suggest the Trump administration is planning to expel a million Palestinians from Gaza to Libya, and the next, the US embassy in the country denies it. It is plausible that briefing and counterbriefing reflects schisms inside the American establishment over the question, which takes us to the future of Gaza itself, largely obliterated by Israel with the support of its NATO allies.

The proposal for a Trump-Netanyahu “Riviera” in an ethnically cleansed Gaza was never going to be accepted by the region; the AI rendering of such a grotesque spectacle posted by Trump on social media was too on the nose. But the material effect of this proposition was to hasten the Egyptian plan for Gaza, which rejected the ethnic cleansing of the strip. This plan was supported by the Arab Summit, and quietly Britain, France, Germany, and Italy also backed it. Contrary to some initial reports, the US didn’t reject it. Middle East envoy Steve Witkoff said it was a “good faith first step from the Egyptians.”

Israel has been driven into a corner: it needs regional normalization, but its negotiating position has been undermined because of its criminal and genocidal actions. With each hour it remains on its current course, its position becomes weaker. Moody’s Ratings warns of “severe implications for the government’s finances” and “a further erosion in institutional quality,” as a result of high political risks. Israel could lose some $400 billion in economic activity over the next decade, according to some estimates.

Despite this, the United States will now make deals with Arab states without raising normalization as a prerequisite. In return, Trump has secured a $600 billion Saudi investment pledge, including in one of the largest arms deals in history. This also disrupts the ironclad US commitment to Israel’s “qualitative military edge,” which is meant to guarantee it military supremacy in the Middle East. Trump also made clear in his keynote speech that Western intervention was a failed enterprise and nodded toward the uprooting of American soft power NGOs by ending US Agency for International Development (USAID) funding.=

Ending the Anarchy

This gives the regional players and the Gulf Cooperation Council a historic opening to discipline Israel and advance a Palestinian state. It should be said that any such objective on their part would not be altruistic, given the lack of action these regimes have taken to stop the genocide in Gaza. They are incentivized to ensure their regional sphere in the new global order is anchored in a way that is favorable to them. Saudi Arabia, in this vein, sees Israel as a security threat to its ambitions for the region because its depraved expansionist approach to the Palestinians generates cyclical violence and political unrest. The righteousness of the Palestinian cause is quite incidental (which is why it is, inexcusably, in no rush to act).

The Palestinian question is, at the same time, hardwired into regional interstate competition and serves as a platform to bring Israel to heel. The questions are: to what extent and at what pace? Another important factor is the demand for regional harmony being made by international capital – given the trade geography of the global economy – which can no longer tether itself to the US bombing new markets open.

While a narrower set of interests around arms manufacturing prefers permanent conflict, there are broader and far more differentiated flows of commerce impeded by it. This partly explains why the Financial Times has been outspoken for a cease-fire since as early as October 2023, and why other establishment publications like the Economist are slowly breaking from Israel’s Gaza policy.

Pressure is growing, and relationships are straining. Britain, France, and Canada this month released a joint statement condemning Israel’s military expansion and the lack of aid entering the strip; for the first time, the threat of targeted sanctions was broadcast. In response, Netanyahu claimed this represented a “huge prize for the genocidal attack on Israel on October 7th.” The latest statement is itself cynical, given that its signatories have been unrepentant in their provision of arms, technical support, and political cover for Israel.

However, these nations have reputational interests, global security concerns, and economic competition to consider. It is no coincidence, for instance, that Rachel Reeves has said that Britain is targeting a major Gulf trade agreement, following recent negotiations between the European Union and India. Such arrangements will be thrown into disarray should Israel be allowed to conclude the genocide and ethnically cleanse Gaza, given the consequences entailed for the region.

In Spain, last week more than three hundred officials and investors convened in Riyadh for a Spanish-Saudi Business Forum in which substantial deals were made. At the same time, Spain is calling for an arms embargo on Israel and is urging its European allies to do the same. It has also called for concrete moves toward a Palestinian state. These and other items were discussed at a high-level summit known as the “Madrid Group” on Sunday, which included representatives from European countries, including France, Britain, Germany, and Italy, along with envoys from Egypt, Jordan, Saudi Arabia, Turkey, Morocco, the Arab League, and the Organisation of Islamic Cooperation. Israel is becoming a problem for the West to deal with, inhibiting its private sector and regional deals, rather than a rational and profitable partner.

Netanyahu, isolated and losing strategic value to the United States, has no viable path forward. It is possible he is negotiating his own “day after,” using his only remaining leverage: inflicting further misery on Palestinians and barbarically ratcheting up the stakes. His recent trip to Hungary was related to the International Criminal Court (ICC) proceedings. And while it is true the ICC is a colonial instrument, there is no guarantee that the drive to consolidate blame around one individual can be avoided; we can expect a harder Western turn against Netanyahu as states seek to distance themselves from the catastrophe they have jointly unleashed in a bid to reset relations with the Middle East, as well as the Global South.

Netanyahu also faces a domestic legal swamp involving corruption charges, which are much harder to evade. But the underlying and foundational issue is that the geopolitical recalibration attendant on the emerging multipolar world system relegates Israel’s comparative importance to US policy in the region — not just Netanyahu’s.

A Salvage Operation

Netanyahu and his allies remain in control of the Israeli state — making it all the more dangerous and volatile — but their rule is fracturing and unsustainable. Netanyahu’s policy only eventuates in further curtailing Israel’s fortunes. It should also be said that this conflict is not between a handful of peaceniks and a united Israeli ruling class. Ruptures exist within the business elite, the military, security services, and among prominent political figures. We must also factor in the most fanatical and messianic elements, the settlers and so on, who are likely to become more dangerous as the situation evolves, fragmenting the state’s cohesion further. As the horrors intensify, splits will become more desperate in tone. One politician, Moshe Feiglin, recently argued on Channel 14 that “every child, every baby, is an enemy”; another, Yair Golan, has warned that “Israel is on the way to becoming a pariah state, like South Africa was . . . a sane country does not fight against civilians, does not kill babies as a hobby, and does not give itself the aim of expelling populations.”

Former Israeli prime minister Ehud Olmert has himself taken a critical stance, telling a “People’s Peace Summit” that “Gaza is Palestinian and not Israeli. It needs to be part of a Palestinian state.” This, he argued, is the basis for achieving normalization. Former Mossad and Shin Bet heads have also coauthored a letter with a former deputy IDF chief urging Trump not to listen to Netanyahu and to end the “war.” These interventions are, of course, based on self-interest and the knowledge that Netanyahu has run out of road. The mission now is a salvage operation: an attempt to realign Israel and the United States as far as possible. It is notable that Israel’s once-confident defenders in the media are now silent. There is no single propaganda line to coalesce around; the narrative has collapsed entirely. The international Palestine solidarity movement, meanwhile, has been justified in its key demands and its assessment of the scale and objectives of the horror unleashed on Gaza.

This movement has been the vanguard of moral conscience in these past months, and it has also been politically inclusive, despite the smears directed against it. Now in the West, the “great and the good” have started to turn. Although stopping short of identifying the apartheid nature of the Israeli state, New York Times columnist Thomas Friedman writes, ‘This Israeli government is behaving in ways that threaten hardcore US interests in the region. Netanyahu is not our friend.” In the Guardian, Jonathan Freedland predicts that Trump will betray his onetime ally. The former European Commission vice president Josep Borrell now says that Israel is committing genocide. Emmanuel Macron is due to cohost a summit in New York with Saudi Arabia on setting up a Palestinian state.

To reiterate, these moves are based on interests, not morality. In the case of France, Macron is vying for European and French objectives in the Middle East, for which loyalty to Israel yields diminishing returns. They, like the United States, require a new means through which to interface with the region. Others are looking to the long-term sanitization process of the Israeli state that will be required, by reducing the issue to one especially bad aberration in the form of Netanyahu.

Nothing can be taken for granted in the arguments made here — not least because the Israeli cabinet is likely to become ever more vexed. At every stage, the global Palestine movement must continue to mobilize, institutionalizing and universalizing its positions as it does. It is only because of the determination of the Palestinian people that, against all the odds, they are in the end the crucial and decisive factor in the overarching regional calculation. The struggle of the Palestinian people for dignity, freedom, and human rights has shown in practice what they have always attested to: existence is resistance.