The core obstacle to Israeli-Palestinian peace is not borders or settlements but the Palestinians' religious and cultural refusal to accept Jewish sovereignty in any form, according to WSJ opinion writers responding to Rahm Emanuel's proposal for a 23-state solution.
A pair of Wall Street Journal opinion writers argued this week that the Israeli-Palestinian conflict is not a conventional real-estate dispute but a 77-year impasse rooted in the Palestinians' refusal to accept Jewish sovereignty on any borders — a dynamic that Rahm Emanuel's proposed "23-state solution" does not address.
"The conflict is bottomed on the Palestinians' religious and cultural refusal to accept Jewish sovereignty on any borders," wrote Gregg Mashberg in a letter published Monday. "That is the actual Palestinian cause, despite the conventional wisdom that Palestinians are helpless victims simply seeking statehood — which they've rejected repeatedly when presented with end-of-conflict opportunities."
Mashberg was responding to Emanuel's July 6 op-ed "A New Path for NATO and Israel," which called on Arab states to press the Palestinians to become "a partner for peace." Emanuel's framework envisions 23 Arab and Muslim nations normalizing relations with Israel while conditioning progress on Palestinian political reform. But Mashberg said the proposal, while welcome, overlooks the ideological dimension that has derailed every previous peace initiative.
Doron Lubinsky of Atlanta echoed the critique in a separate letter, noting that "every Palestinian faction has rejected peace" and that "never before has it been so clear that they and their regional backers reject Israel's existence in any form and behind any boundaries." Lubinsky argued that Israeli concessions have historically led to more attacks rather than peace, and that holding Palestinian leaders accountable — rather than appeasing them — is the only viable path forward.
The rejectionist record
The letters arrive as the conflict enters its fourth year since the Hamas-led attacks of Oct. 7, 2023, in which militants killed roughly 1,200 people and kidnapped 251 others, according to Israeli tallies. The subsequent Israeli military campaign in Gaza has killed more than 37,000 Palestinians, per the Gaza Health Ministry, and displaced most of the territory's 2.3 million residents.
The historical pattern the writers cite is well-documented. Palestinians rejected the 1947 UN Partition Plan, which would have created a Palestinian state alongside Israel. They rejected the 2000 Camp David offer from Prime Minister Ehud Barak, which proposed a Palestinian state on roughly 95 percent of the West Bank and all of Gaza. They rejected the 2008 offer from Prime Minister Ehud Olmert, which went further. Each time, the rejection was followed by violence.
Mashberg praised Emanuel for not "falling back on the shopworn refrain that Israel holds all the cards for resolving this conflict and the Palestinians hold none." Instead, he said, Emanuel is "politely calling upon the Arab governments to stop pandering to Palestinian rejectionism and start pressing the Palestinians to abandon their mythic quest to turn the clock back to 1948."
Market and geopolitical implications
For investors, the persistence of rejectionism carries measurable costs. The conflict has pushed Israel's shekel to multiyear lows, widened its sovereign CDS spreads, and raised defense spending across the region. Saudi Arabia's normalization talks with Israel, which were progressing before Oct. 7, remain frozen. Brent crude has traded with a persistent geopolitical risk premium of $3 to $5 per barrel since the escalation, according to analysts at Goldman Sachs.
The last time the region saw a comparable period of diplomatic paralysis was after the 2000 Camp David collapse, which preceded the Second Intifada and a decade of stalled peace efforts. During that period, the Tel Aviv Stock Exchange's main index fell 42 percent in local-currency terms between September 2000 and July 2002, while Israel's defense budget rose to 9.4 percent of GDP from 7.8 percent.
Emanuel's proposal shifts the burden from Israel to Arab capitals, a framing that some analysts say could gain traction as Gulf states prioritize economic diversification over the Palestinian cause. The Abraham Accords of 2020 demonstrated that several Arab governments — including the United Arab Emirates, Bahrain, and Morocco — are willing to normalize relations with Israel without a Palestinian state first.
"Can you imagine any other conflict where the party that is repeatedly attacked is expected to make endless concessions to implacable foes after surviving the wars they start?" Lubinsky wrote. "There can't be peace until the Palestinians and other regional regimes end their obsession with wiping out Israel."
This article is for informational purposes only and does not constitute investment advice.
