By James L. Hecht, DenverPost.com, 07.12.07

As was noted deep in the Iraq Study Group report, "The United States will not be able to achieve its goals in the Middle East unless the United States deals directly with the Arab-Israeli conflict."
An Israeli-Palestinian settlement has long been recognized as necessary to making progress in ending terrorism. But how can this long- sought goal be achieved? Perhaps the question can be framed as, "How much money would it be worth to the United States to broker a peace that would be acceptable to both the Israeli and Palestinian governments?"
The answer is: a great deal. There is almost universal agreement that the perception of the U.S. favoring Israel at the expense of Palestinian interests is an important factor in the recruitment of terrorists. While terrorism by Islamic extremists is rooted in many factors, if the U.S. received credit for helping to broker a mutually acceptable settlement, that could decrease the number of terrorist recruits.
Such a settlement also would be worth some tens of billions of dollars in other ways. Visits to the U.S. by people from the Middle East for tourism, education and health care have been greatly reduced. And "Made in America," once a marketing asset, now can be a deal breaker in the region. If the image of the U.S. changed to that of peacemaker, these losses would be recouped.
Is peace possible? People in the region long for an end to the bloodshed and destruction. And what is needed for a mutually acceptable agreement is known and supported by large majorities of both Israelis and Palestinians: a two-state solution based on the 1967 borders altered by minor land swaps, plus adequate compensation for Palestinian refugees. This is what comprised both the earlier Geneva Accord and the Saudi Proposal that was supported by all of the Arab countries. Both Hamas and Hezbollah have hinted that they would view such a proposal favorably.
However, the difficulties must not be underestimated. Israelis are hyper-vigilant about security. History has instilled in Jews the determination that they cannot trust their security to others. Also, both sides have significant minorities that oppose peace. These include the Israeli right-wingers who believe God gave Judea and Samaria to the Jews, Palestinians who cannot accept the reality of a Jewish state on land that once belonged to Arabs, and the many on both sides so embittered by past violence that they will try to resist a settlement. Another barrier is that Israel would lose 30 percent of the water it now uses if a Palestinian state had complete control of the West Bank.
These barriers will not be overcome unless the U.S. takes a much more active role, including a willingness to invest large amounts of money to assist both sides. Here is what is needed to bring about a mutually acceptable settlement between Israelis and Palestinians.
•  Give as aid to Israel a significant part of the $15 billion to $30 billion needed to relocate settlers from the West Bank to Israel.
•  Pledge that if Israel were attacked by another nation, the U.S. would consider it the same as an attack on America.
•  Finance large desalination plants to alleviate a water crisis without requiring Israel to cut back on its highly subsidized agriculture.
•  Make large grants to the Palestinian government for building infrastructure.
•  Provide substantial compensation to all Palestinian refugees.
It is unlikely that the U.S. would need to bear the entire cost of these subsidies for peace. If the U.S. provided leadership, the European Union probably would be willing to increase the substantial aid it already is providing to the Palestinians. But even if the U.S. picked up the entire bill, it would be an excellent investment for the future.
What can bring about a change in U.S. policy to take such a course of action? It would help greatly if enough people recognize that the best way they can show support for Israel is to support publicly such an investment in peace. Israeli security cannot be achieved by military force alone. To be pro-Israeli also means to be pro-Palestinian, because the fate of the two nations is inexorably linked.
James L. Hecht is a senior fellow at the Center for Public Policy and Contemporary Issues at the University of Denver.