Rabin was the indispensable man for the Oslo process. His immediate successor as prime minister was his old rival Shimon Peres. Though an architect of Oslo, Peres did not enjoy the same degree of public confidence as Rabin. The Israeli voters did not place the trust in Peres that an enduring land-for-peace settlement required. Deemed weak on security, Peres tried to confound his critics by launching a military campaign against Hizbullah in retaliation for its attacks on Israeli positions in South Lebanon and missile attacks on northern Israel. The April 1996 initiative, Operation Grapes of Wrath, confirmed voters’ doubts about Peres’s judgment on security issues. The massive incursion into Lebanon displaced 400,000 Lebanese civilians and provoked widespread international condemnation when the Israeli air force bombed a UN base in the southern Lebanese village of Qana, killing 102 refugees who were seeking shelter from the assault. The operation was brought to an ignominious end by American mediation, with no visible benefit to Israel’s security. Peres was punished by voters in the May 1996 election, when Likud leader Benjamin Netanyahu won the premiership by the slenderest of margins. Netanyahu’s election set Israel on a collision course with its Oslo commitments. Netanyahu and his party had consistently opposed the principle of exchanging land for peace. Although he did succumb to American pressure to conclude a redeployment scheme from the West Bank town of Hebron, Netanyahu’s minor land for peace deal left Israel in full control of more than 71 percent of the West Bank, and in control of security over 23 percent of the other territories. This was a far cry from the 90 percent transfer the Palestinians expected from the Oslo II agreement. In his battle for Jerusalem, Netanyahu used the settlement movement to create unalterable facts on the ground. He commissioned 6,500 housing units on Jabal Abu Ghunaym to create a new settlement called Har Homa, which would complete the encirclement of Arab East Jerusalem with Israeli settlements. By encircling Jerusalem with Jewish settlements, Netanyahu intended to preempt any pressure to surrender the Arab parts of the city occupied in June 1967 to the Palestinian Authority. Har Homa was the latest of an escalating settlement policy that, more than any other factor, led to the collapse in Palestinian confidence in the Oslo process. After three years in office, Netanyahu lost the confidence of his own party and, dogged by corruption scandals, was forced to call for new elections in May 1999. He was defeated, and the Labor Party returned to power under another retired general, Ehud Barak. One of Barak’s campaign promises had been to end Israel’s occupation of South Lebanon and withdraw all Israeli troops within one year if elected. The occupation of South Lebanon had grown increasingly unpopular in Israel, as persistent attacks by Hizbullah inflicted regular casualties on Israeli forces. Having won a landslide victory over Netanyahu, Barak made the Lebanon withdrawal one of his first priorities. However, efforts to effect a smooth transfer of power from the departing Israeli forces to their local proxies of the South Lebanon army collapsed as the collaborators surrendered to Hizbullah units. Israel’s unilateral withdrawal degenerated into an unseemly retreat under fire, leaving Hizbullah to claim victory in its eighteen-year campaign to drive the Israelis from Lebanon. Israel’s top brass chafed, eagerly awaiting the next opportunity to settle the score with the Shiite militia. The opportunity for future conflict was preserved in a territorial anomaly. Israel withdrew from all of Lebanon except the disputed “Shiba’ Farms” enclave, a strip of land 22 square kilometers (8 square miles) in area along Lebanon’s frontier with the occupied Golan Heights. Israel claims to this day that it is occupied Syrian territory, whereas Syria and Lebanon insist it is Lebanese territory. Hizbullah takes Shiba’ Farms as a pretext for continuing its armed resistance against Israeli occupation of Lebanese territory. Once out of Lebanon, Prime Minister Barak resumed negotiations with the PLO. In view of Israel’s actions under Netanyahu, there was little trust or goodwill between the two sides. Yasser Arafat accused the Israelis of failing to meet their treaty obligations under the Oslo Accords and pressed Barak to respect unfulfilled commitments under the interim agreements. Barak, in comparison, wanted to proceed directly to discuss a permanent settlement. The Israeli premier believed that negotiations with the Palestinians had been undermined through endless disputes over interim details, and he wanted to take advantage of the closing months of the Clinton presidency to secure a permanent settlement. Bill Clinton invited Barak and Arafat to a summit meeting at the presidential retreat in Camp David, Maryland. The three leaders met for two weeks in July 2000, and though bold new ideas were put on the table, the summit ended without any substantive progress toward a settlement. A second summit was held in the Egyptian resort of Taba in January 2001. There, the Israelis offered the most generous terms yet tabled; even so, the Taba proposals still left too much of the proposed Palestinian state under Israeli control to serve as a permanent settlement. The failure of the Camp David and Taba summits led to bitter recriminations and finger pointing, as both the American and the Israeli teams wrongly placed the blame for failure on Arafat and the Palestinian delegation. The trust and goodwill necessary for Palestinian-Israeli peacemaking had evaporated.
The Oslo framework had been flawed, but it brought Israel and the Arab world closer to peace than at any point since the founding of the Jewish state in 1948. The gains of Oslo were very significant. Israel and the PLO had overcome decades of mutual hostility to exchange recognition and enter into meaningful negotiations toward a two-state solution. The Palestinian leadership left exile in Tunisia to begin building its own state in the Palestinian territories. Israel broke its isolation within the Middle East, establishing formal ties with a number of Arab countries for the first time, and overcoming an Arab League economic boycott that had been in place since 1948. These were important foundations upon which to build an enduring peace. Unfortunately, the process was inextricably linked to building confidence between the two sides and to generating sufficient economic prosperity that Palestinians and Israelis would be willing to make the difficult compromises necessary for a permanent settlement. Whereas the Oslo years were a period of economic growth for Israel, the Palestinian economy suffered recession and stagnation. The World Bank recorded a significant decline in living standards over the Oslo years and estimated that one in four residents of the West Bank and Gaza had been reduced to poverty by 2000. Unemployment rates reached 22 percent.47 The decline in living standards between 1993 and 2000 produced widespread disillusion with the Oslo process. Israel’s decision to expand the settlements was also a key factor in dooming the Oslo accords. As far as the Palestinians were concerned, settlements were illegal in international law and their continued expansion contravened the terms of the Oslo II Accords.48 Yet the Oslo years witnessed the greatest expansion of Israeli settlements since 1967. The number of settlers in the West Bank and East Jerusalem rose from 247,000 in 1993 to 375,000 in 2000—a 52 percent increase.49 Settlements were built in areas Israel wanted to retain either because of their proximity to urban centers within Israel or to crucial aquifers, providing control over scarce water resources in the West Bank. Palestinians accused the Israelis of forsaking land-for-peace for a land grab, while the guarantor of the process, the United States, turned a blind eye. The Palestinians expected nothing less of the Oslo process than an independent state on all of the territory of the West Bank and Gaza Strip with East Jerusalem as its capital. The Palestinians knew their position was supported by international law and believed it was reinforced by the demographic reality that the territories were almost exclusively inhabited by Palestinians. The PLO had come to recognize the state of Israel in the 78 percent of Palestine conquered in 1948, and the Palestinians held to their rights over the remaining 22 percent of the land. With so little space on which to build a viable Palestinian state, there was no room for further concessions.
The expansion of settlements contributed significantly to public anger at a process Palestinians believed failed to deliver statehood, security of property, or prosperity. That anger boiled over in a series of violent demonstrations that broke out in September 2000 and developed into a new popular uprising. Whereas the First Intifada (1987–1993) had been marked by civil disobedience and nonviolence, the second uprising was very violent indeed. The outbreak of the Second Intifada followed a visit by Ariel Sharon, who had risen to lead the right-wing Likud Party, to East Jerusalem on September 28, 2000. At the Camp David summit, Prime Minister Ehud Barak had raised the possibility of relinquishing East Jerusalem to Palestinian control and for Jerusalem to serve as the capital of both Israel and Palestine. The proposal was enormously controversial in Israel, prompting some of the members of Barak’s coalition to withdraw from the government in protest, which in turn required a new election. For Sharon, Jerusalem was a vote winner. He chose to visit the Temple Mount in East Jerusalem to reinforce his party’s claim to preserve Jerusalem as the undivided capital of Israel and to launch his campaign to unseat Barak as prime minister. The Temple Mount, known in Arabic as the Haram al-Sharif (Noble Sanctuary), was the site of Judaism’s Second Temple, destroyed by the Romans in A.D. 70, and, since the seventh century, home to the Aqsa Mosque, Islam’s third-holiest site after Mecca and Medina. Because of its significance to both Judaism and Islam, the Temple Mount is politically charged territory. Sharon arrived in Arab East Jerusalem on September 28, 2000, with an escort of 1,500 armed police and toured the Haram al-Sharif. In his comments to the press pack that followed the Likud leader, Sharon asserted his commitment to preserve Israeli rule over all of Jerusalem. A group of Palestinian dignitaries, on hand to protest Sharon’s presence, were dispersed by Sharon’s security detachment. Television cameras captured Israeli police rough-handling the Aqsa Mosque’s highest-ranking Muslim cleric. “As chance would have it, his turban, a symbol of his exalted spiritual status, got knocked off his head and tumbled into the dust,? Sari Nusseibeh recalled. ?Viewers saw the highest Muslim cleric of this highly charged Muslim site standing bareheaded.? This insult to a respected Muslim official in Islam?s third holiest site was enough to provoke a massive turnout the next day for Friday prayers in the Haram. ?Armed and nervous [Israeli] border police marched into the Old City by the hundreds, while hundreds of thousands of Muslims poured through the gates from neighborhoods and villages.? Prayers were conducted without an incident, but as the angry crowd withdrew from the mosque a violent demonstration erupted. Teenagers threw stones from the Haram complex onto Israeli soldiers posted to the Western Wall below. The Israeli border police stormed the Haram complex while soldiers opened fire on the protesters. Within minutes, eight rioters were shot dead and dozens fell wounded. “The ‘Al-Aqsa intifada’ had begun,” Sari Nusseibeh recorded. 50 The deterioration in public order played to Sharon’s advantage, given his reputation for being tough on security, and he swept to power in February 2001. Israel’s bellicose new prime minister was more interested in land than peace, and his election only exacerbated volatility between Israelis and Palestinians. At the start of a new millennium, the Middle East was further from peace than ever.