The United States and the Israeli Settlements: Time for a Change
Zaki Shalom - Strategic Assessment, Volume 15, No. 3
http://www.inss.org.il/upload/(FILE)1352290638.pdf

[Prof. Zaki Shalom is a senior researcher at the Ben-Gurion Research
Institute for the Study of Israel and Zionism at Ben-Gurion University and a
senior research fellow at INSS.]

Introduction

The issue of the Jewish settlements in the West Bank has been a source of
disagreement within Israel for over forty years. Some governments viewed
them as a vital national interest, especially from a security standpoint.
Others viewed the enterprise as the realization of an ideological and
religious belief, and the historic right of the Jewish people to the land of
its forefathers. Still others viewed the settlements as the price to pay for
coalition constraints. But all Israeli governments have invested
signi�cantly in the project in various ways.
In parallel, the issue of the settlements has been a bone of contention
between Israel and the United States since the end of the Six Day War. This
issue has strained the relationship between the two allies perhaps more than
any other topic.

Almost every administration tended to de�ne the position of the United
States on the Jewish settlements on the basis of two parameters: one, that
the settlements are not legal, and two, that the settlements are an obstacle
to peace. Two Republican administrations were notable exceptions. Ronald
Reagan declared that he did not accept the position that the settlements
were not legal (“they’re not illegal�1). At the same time, he criticized the
manner and pace of establishing the settlements and saw them as a
provocation. The other exception was the George W. Bush administration,
which formulated a set of comprehensive understandings with Prime
Ministers Sharon and Olmert over the settlements. The meaning of these
understandings was a limited, de facto recognition of the settlement
enterprise, assuming, however, that any construction was based on a
framework agreed upon by both Israel and the United States.

In hindsight, one may say that America’s longstanding opposition to the
settlement enterprise did not achieve its objective. In practice, the
project continued and expanded, and seems to have created an irreversible
territorial and demographic reality in the Middle East. Under these
circumstances, perhaps the American administration might consider whether
there is any value in continuing to express sweeping opposition to the
settlement enterprise. Experience proves that international opposition in
general and American opposition in particular to the settlement project,
complemented by support among many circles in Israel, failed to stop this
national venture. Therefore, the administration might question if and to
what extent maintaining American opposition is liable to damage the status
and prestige of the United States in the international community. More
concretely, the inevitable question is: has the time come for a change in US
policy on the issue of Jewish settlements in the West Bank?

Despite the awareness on the part of the US administration of its
failure to stop the settlement project, it will almost certainly not condone
or accept the enterprise outright. According to the outlook of all US
administrations, the settlement project severely damages not only American
interests but also the interests of the State of Israel – a position widely
held among much of the Israeli public and political establishment The
American opposition, based on moral, legal, and political considerations, is
shared and supported by the international community, which takes an even
more extreme position on the issue than the United States. Therefore, the
administration cannot be expected to come to terms with the full expression
of the settlement project.

On the other hand, given that the US policy on the settlements is in
practice not implemented, the administration must necessarily consider
whether maintaining sweeping opposition is liable to harm United States
international status and prestige. Signi�cantly, since 1967, US
administrations have resisted the option of escalating the disagreement over
the settlements to the point of a rupture in relations with Israel and even
imposing sanctions against it. Moreover, while any such pressure would be
met negatively by Israel, it is far from certain that stopping the
settlement project would advance an agreement with the Palestinians.

Issues much more dif�cult to resolve are on the agenda, including the
Palestinian Authority’s insistence on the “right of return� – at least in
part – of Palestinian refugees; the division of Jerusalem and recognition of
East Jerusalem as the capital of a Palestinian state; and the future borders
of the Palestinian state, which would require dismantlement of settlements.
In this situation, therefore, the most reasonable and effective option is an
administration effort to formulate a document of understanding with Israel
about the Jewish settlements in the West Bank. Such a document would allow
Israel to continue the project on the basis of an agreed-upon, limited
outline. Its main points would likely mandate that Israel:

a. reiterate its acceptance of the land for peace formula, the Oslo
accords, and the two-state vision;

b. make clear that the settlement enterprise will not impact on the
delineation of the permanent border between Israel and a future Palestinian
state;

c. refrain from establishing new settlements and expanding the territorial
area of existing settlements;

d. focus its activities on the settlements located inside the large
settlement blocs;

e. limit construction within existing settlements for the purposes of
natural growth and maintenance of normal life; and

f. refrain from con�scating Palestinian land for the purpose of Jewish
settlements and from providing incentives to Israelis to move into
settlements.

The American administration would refrain from voicing opposition to Israeli
construction throughout Jerusalem.

Such a formula for a document of understanding could be acceptable to both
right and left wing Israeli governments. A largely similar document of
understanding was in place between President George W. Bush and Prime
Minister Ariel Sharon. There is no reason for the current American
administration not to adopt it as well.

The United States and the Settlements: The Core Issues

Since the end of the Six Day War, every US administration has evinced
negative positions on the settlement enterprise, emphasizing their
questionable legality and their obstruction of peace efforts. Since 1981,
following President Reagan’s assertion that he does not accept the
illegality of the settlements, the administration focused primarily on the
impact of the settlements on the peace process.2

Administration �gures occasionally presented the settlement activity as
representative of a tendency by both Israel and the Palestinians to act
unilaterally; unilateral measures were deemed unacceptable. In a letter to
the Palestinian leadership on the eve of the Madrid Conference (October 24,
1991), the administration linked its opposition to the settlements to an
overarching opposition to unilateral conduct on both sides. Nonetheless,
most of the cases of unilateral action mentioned by the administration were
the settlements, without speci�c mention of unilateral action on the part of
the Palestinians.3

Some statements by administration of�cials indicated that the
administration’s opposition to the settlements reflected not only American
national interests but also vital Israeli national interests. Daniel C.
Kurtzer, who served as US ambassador to Israel in 2001-2005, made the point
very clearly (May 29, 2002). Relying to a great extent on accepted opinion
among widespread circles on the Israeli left, he stressed that Israel’s
status and security would improve if and when it ended the settlement
project: “Our opposition to the settlements is political. Washington feels
that Israel would be better protected and more accepted inside borders where
there are no settlements.�4

President George W. Bush added another element to the administration’s
opposition to the settlements. In his opinion (May 24, 2006), the
settlements created serious friction between Jews and Arabs and thereby
contributed to an intensi�cation of the hatred and violence in the region.
President Bush’s statement in this context was intended to justify his
support of Prime Minister Sharon’s disengagement plan and his fairly
supportive position toward Prime Minister Olmert’s convergence plan. He
also stressed the importance of Israel working in agreement with the
Palestinians and emphasized the dismantlement of settlements as a move
capable of enhancing peace in the region.5

The political foundation for these and other positions on the settlements
was laid a few months after the end of the Six Day War, when the settlement
phenomenon was still in its infancy and its dimensions were limited. The
Johnson administration made its position clear when it stated that the
Israeli government must not operate in the territories it occupied during
the war in a way that might prejudice peace efforts and realization of the
land for peace formula. Beyond this, the administration argued that such
activity was in contravention of Paragraph 49 of the Geneva Convention,
which states that an occupying force will not move its own population into
the territory it occupies.6

Subsequent administration statements infused additional nuances. The Johnson
administration, for example, tried on several occasions to draw a
connection, albeit indirect, between the settlement issue and the
Arab-Israeli conflict, speci�cally, Israel’s sense that the Arab world aimed
at Israel’s destruction. Linking the settlements to the state of the conflict
was almost certainly related to the decisions of the Khartoum conference
(August 29-September 1, 1967), which expressed an extreme Arab position on
reaching a political agreement with Israel, and the ongoing War of Attrition
along the Suez Canal.7 Against this background, it is possible to understand
President Johnson’s assertion that it was Israel’s responsibility to
persuade the Arab world that it had no policy of territorial expansion by
means of the settlements in the West Bank. At the same time, he demanded
that the Arab world persuade Israel that it had abandoned thoughts of Israel’s
destruction. This statement may have implied an idea held by other
administrations as well, namely, an understanding of Israel’s “right� to
continue its settlement policy as long as the state of conflict with the Arab
world prevails and as long as Israel has reason to suspect that the Arab
world still aims to destroy it.8
Some of the statements on the settlements raised the issue of the status of
Jerusalem in general and of East Jerusalem in particular. One June 27, 1967,
the Knesset voted in favor of Amendment 11b to the Law and Administration
Ordinance, whereby “the law, jurisdiction and administration of the State
shall extend to any area of Eretz Israel designated by the Government by
order.�9 This amendment allowed the government to apply Israeli law to East
Jerusalem shortly thereafter. Concurrently, Israel started a process of
accelerated construction in the eastern part of the city in order to give
concrete expression to its sovereignty over the united capital.

The US administration had reservations about this activity, and stated
repeatedly that East Jerusalem is part of the territory Israel occupied in
the Six Day War and was to be treated no differently than any other area in
terms of settlement. From the administration’s perspective, all steps Israel
takes in East Jerusalem, including at historic and religious sites, and the
application of Israeli law to Jerusalem, are in contravention of
international law and harm the mutual interests of both Israel and the
United States. In a speech on July 1, 1969, Charles W. Yost, United States
ambassador to the United Nations under the Nixon administration, declared
that “the administration regrets and deplores� the steps taken by
Israel in East Jerusalem, since from the US perspective, East Jerusalem is
part of the territory occupied during the Six Day War and all international
laws regarding control of an occupied territory apply there too. The
administration made it clear to Israel that such steps would not affect a
decision on the city’s status in any future agreement.10

Limited Power of Persuasion

At the same time, many of the references by administration of�cials to the
settlements have tended to downplay their importance to discussions of an
Israeli-Palestinian settlement and have questioned the level of intensity
with which the United States ought to oppose the phenomenon. This tendency
stemmed from several understandings. First, with Israel determined to
continue the settlement enterprise, the international community in
general and the American administration in particular lacked any real power
to stop Israel from realizing its intention. Second, the settlement issue
was only one disputed issue among many between Israel and the Palestinians,
and there was no point in making this issue the focus of the conflict. Third,
if and when a permanent Israeli- Palestinian agreement were reached,
Israel would be prepared to dismantle settlements and relocate their
residents to other areas.
The legal advisor of the State Department during President Nixon’s term gave
prominent expression to the sense of the administration’s limited power with
regard to construction in the settlements. In April 1973, he made it clear
that the administration’s position on the settlements was that Israel is
obligated to act on the basis of the Geneva Convention in the territories.
At the same time, he was quite candid in stating that Israel was in practice
refusing to realize its obligations on the basis of that convention.11

President Jimmy Carter, one of the most blatant opponents of the settlement
enterprise, provided another example of the administration’s implied
recognition of the limits of its power against Israel and the settlement
project. On March 3, 1980, he said he was opposed to sharply worded
anti-Israel formulations in resolutions by international organizations and
their call to dismantle the settlements: “This call for dismantling
[settlements] was neither proper nor practical.�12 To a large degree this
position may have stemmed from the fact that Israel was then headed by
Menachem Begin, a right wing ideologue. The President likely assessed that
even subject to intense pressure Begin would refuse to heed a directive to
dismantle the settlements, and any such resolutions would remain on paper
only, unful�lled by the Begin government. Were that to happen, it would
compromise the status of the United States and its authority as a
superpower.

On another occasion, President Carter made it clear that the United States
did not have to engage in extreme rhetoric against the settlement phenomenon
or support extreme resolutions against Israel because the United States had
accepted explicit Israeli commitments, both public and secret, that the
settlements were not the expression of an Israeli policy of annexation and
that Israel accepted the fact that the borders would be determined through
negotiations and a political agreement. Thus, on August 23, 1977 Carter went
so far as to make it clear in public that the United States was not going to
go beyond an “open expression of our own concern� and opposition to Israel’s
moves on the settlements.13

This formulation implied that the issue of the settlements should not
be highlighted as an obstacle to an Israeli-Palestinian agreement, because
if and when the sides arrive at an agreement on borders, Israel would be
prepared to withdraw from the required settlements. In later years,
especially in the initial stages of the dialogue with the Obama
administration, the Israeli government made much use of this assertion to
stress its opposition to the Palestinian rejection of negotiations with
Israel as long as the settlement phenomenon continues.
Expressions of helplessness in face of the expanding phenomenon of the
settlements were also prominent during the tenure of George W. Bush. On May
1, 2002 Secretary of State Colin Powell said: “Something has to be done
about the problem of the settlements, the settlements continue to grow and
continue to expand….It’s not going to go away.�14 The statement was made
during the height of the second Palestinian intifada, when suicide bombings
were commonplace in Israel. The administration could seemingly have used
this context to demand an end to the settlements in no uncertain terms,
especially as the settlements were more than once portrayed as being a key
reason for Palestinian violence. More than a year later, on September 21,
2003, Powell admitted that the United States had failed to stop the
expansion of the settlements: “Settlement activity must stop. And it has not
stopped to our satisfaction.�15 On May 29, 2002 Ambassador Kurtzer
expressed in a fairly extreme manner the impotence felt by the Bush
administration in face of the settlement project: “It is a fact that we have
opposed the settlements for decades and you continue to build them and we
have done nothing untoward to you [in response]. If Israel wants, it can
even expand to the borders promised in the Bible. The question is whether it
is able to do so from a security and political standpoint.�16

Some of�cials, including President George H. W. Bush and Secretary of State
James Baker, threatened Israel should it not put an end to the settlement
enterprise, making loan guarantees to Israel conditional on an essential
change in Israel’s settlement policy. In his March 3, 1990 speech, the
President made it clear that the administration’s position opposed the
establishment of settlements in the West Bank and East Jerusalem. He
stressed that he intended to realize this position fully and would examine
the extent to which “people� – i.e., Israel – “can comply with that policy.�17

Secretary of State Baker too adopted a harsh stance on the settlements. On
May 22, 1991 he complained that every time he came to visit Jerusalem
he was met with announcements of the establishment of new settlements. He
interpreted this – with a large degree of accuracy – as an attempt to
embarrass him. He was afraid, and justi�ably so, that the lack of a vehement
reaction by the administration to these announcements would almost certainly
be seen as a demonstration of the administration’s weakness and fear of a
conflict with the Israeli government. It would almost certainly have led
Israel to accelerate the settlement project even more, to the chagrin of the
American administration. In the end, he too found himself complaining about
a reality he found dif�cult to change and spoke of “settlement activity that
continues not only unabated but at an advanced pace.�18

The increasing intensity of Palestinian violence, especially early in the
second intifada, placed the Israeli-Palestinian conflict, including the focus
on the settlements, high on the global agenda. In examining the events that
touched off the intifada in the fall of 2000, the report written by George
Mitchell (April 30, 2001) stated that the settlements were a major source of
Palestinian violence. It demanded a total freeze, including construction for
the purposes of natural growth. According to the report, it would be very
dif�cult to prevent a recurrence of Palestinian-Israeli violence unless the
Israeli government stopped all settlement construction. The report further
determined explicitly that “the kind of security cooperation [with the
United States] desired by the GOI [Government of Israel] cannot for long
co-exist with settlement activity.�19

Shifts in Outlook

The �rst dramatic change in position with regard to the settlements occurred
under President Reagan. On February 2, 1980, shortly after assuming of�ce,
Reagan declared that he does not accept the common claim of the illegality
of the settlements, or in his explicit comment, “they’re not illegal.�
According to Reagan, the West Bank must be open to settlement by members of
all religious faiths – Jews, Muslims, and Christians. Nonetheless, he
criticized the way in which the settlement project was conducted, as he felt
it was “unnecessarily provocative� and contrary to the Camp David peace
agreements.20

The Reagan plan for the Middle East dating to early September 1982
contained additional hints of America’s understanding of the
improbability of stopping the settlement project entirely. Therefore, the
plan spoke mostly about avoiding the “use of any additional land for the
purpose of settlements,� i.e., avoiding the establishment of new settlements
or expanding the size of existing settlements. The implication is that it
was acceptable to continue building within the limits of existing
settlements. This principle subsequently served as the basis for the
understanding between President George W. Bush and Prime Ministers Sharon
and Olmert about the settlements. At the same time, the Reagan plan also
perfunctorily recommended that Israel freeze settlement construction in
order to create an easier atmosphere for negotiations and allow different
sides to join the talks.21

A number of statements by recent administrations evinced some
understanding for settlement activity on its own terms, with a concomitant
attempt to delimit its proportions on the basis of a joint Israeli-American
outline. A prominent expression of this came during President Clinton’s
tenure. Assistant Secretary of State for Near Eastern Affairs Edward
Djerejian stated on March 9, 1993 that the United States understood
the need for some settlement activity: “There is some allowance for, I
wouldn’t use the word ‘expansion,’ but certainly continuing some activity,
construction activities in existing settlements. And that’s basically…in
terms of natural growth and basic, immediate needs in those settlements. I
want to get away from the word ‘expansion’ per se.�22 Nearly a decade
later, on April 12, 2001, Djerejian – this time under the Bush
administration – made his position even clearer. He stated: “Some of the
major settlements could be consolidated, and these settlers could become
more con�dent of their eventual status as part of Israel.�23

The events of 9/11 and America’s embarking on a war on radical Islam in Iraq
and Afghanistan created a relatively convenient foundation for a more
comfortable position on the settlements from the Israeli perspective. During
the tenure of George W. Bush, detailed understandings with the Sharon
government were reached about settlement construction: settlements would not
be expanded and construction would be allowed only within the existing
construction outlines. Israel committed itself not to establish any new
settlements and not to con�scate Arab land for construction purposes.24

President Bush gave explicit expression to these understandings when in the
press conference following a meeting with Sharon on April 14, 2004 he
stated: “In light of new realities on the ground, including already existing
major Israeli populations centers, it is unrealistic to expect that the
outcome of �nal status negotiations will be a full and complete return to
the armistice lines of 1949.� This assertion was restated in his April 14,
2004 letter to Sharon, approved by a large majority of the Congress. It
clearly implies recognition of Israel’s right to continue the settlement
project according to an agreed-upon outline and on the basis of assumptions
about regions that would in any case remain in Israeli hands even after a
permanent agreement with the Palestinians.25

The Obama Experience

President Obama showed the most intensive opposition to the settlement
project in Judea and Samaria early in his term in of�ce. It was expressed in
a number of rounds of talks with Israel on the issue, which at times assumed
the nature of blunt confrontation. One memorable statement was made in
President Obama’s June 2009 Cairo speech, when he said that “the United
States does not accept the legitimacy of continued Israeli settlements.
This construction violates previous agreements and undermines efforts to
achieve peace. It is time for these settlements to stop.�26 The Netanyahu
government refused to accept this demand. An intensive dialogue began
between Israel and the US, primarily through the of�ces of Special Envoy to
the Middle East George Mitchell, which eventually led to a decision by the
Israeli government to a partial, 10-month construction freeze in the
settlements. The decision was unprecedented in its scope.

A second confrontation occurred after Vice President Biden’s visit to Israel
in March 2010. At its center was the administration’s demand that Israel
stop construction in Jerusalem. The Netanyahu government refused to accept
the demand as it was stated, but seems to have expressed willingness in
practice to slow down construction. A third confrontation took place after
the 10-month freeze, when the administration demanded that Israel extend the
freeze without receiving anything in return. This too was opposed by the
Netanyahu government, and indeed, since the end of the freeze, there has
been a construction drive in Judea and Samaria unprecedented in terms of its
scope. From time to time, especially after the granting of construction
permits, administration spokespeople reiterate that the phenomenon is an
obstacle to peace.

Conclusion

Since the Six Day War, all American administrations have opposed the
settlement project in the West Bank at one level of intensity or another, on
political, legal, and moral grounds. In most administrations, the opposition
was primarily verbal and did not carry with it real threats against the
Israeli government should it fail to heed US administration demands. The
administration of George H. W. Bush was different, in light of his threat to
deny loan guarantees to Israel unless it froze construction in the
territories.

After more than four decades, it is evident that widespread opposition to
the settlement enterprise on the part of the international community in
general and the American administration in particular, and within large
circles in Israel itself, has not succeeded in shutting it down. Many – even
among the most ardent opponents of the settlement project and even senior
members of the Palestinian leadership – feel that the settlement project has
created an irreversible territorial and demographic reality in the Middle
East that affects a wide range of issues, especially prospects for the
regional peace process.

As a rule, the foreign policy of the United States combines an
ideological, moral approach with a practical, pragmatic one. Historical
experience shows that in many cases, when the United States understood its
opposition to certain moves was pointless, it changed its policy and adapted
it to the prevailing reality. The United States was vehemently opposed to
moving Israeli government ministries and the Knesset to Jerusalem after
the War of Independence. Eventually, it made its peace with the fact, if
only partially. The United States was bitterly opposed to Israel developing
a nuclear option, yet eventually arrived at understandings with Israel over
this sensitive issue. For many years, the United States was opposed to
recognizing China, but was �nally forced to change its position in light of
the prevailing reality.

Should the administration come to recognize the limits of its power to
affect the settlement enterprise in a signi�cant manner, the necessary
conclusion is that it would be in America’s national interests to arrive at
understandings with Israel about the settlements on the basis of the outline
described above. Continuing to embrace the routine formula opposing the
settlements in a sweeping manner damages the status of the United States and
its relations with Israel, and does not lead to an achievement that would
serve the national interests of the United States.

Notes
1 Statements from U.S. Government Of�cials Concerning Israeli
Settlements,� http://www.cmep.org/content/us-statements-israeli-
settlements_short#Reagan.
2 The administration used different phrases in this context, such as “an
obstacle to peace,� “counterproductive,� and “not helpful.� See Donald Neff,
“Settlements in U.S. Policy,� Journal of Palestine Studies 23, no. 3 (1994):
53-69.
3 “Statements on American Policy toward Settlements by U.S. Government
Of�cials – 1968-2009,� http://www.fmep.org/analysis/analysis/israeli-
settlements-in-the-occupied-territories (henceforth: “Statements on American
Policy�).
4 Quoted in Churches for Middle East Peace Website,
http://www.cmep.org/content/us-statements-israeli-settlements_short#Bush2.
5 Michael Doran, Senior Director for Near East and North African Affairs,
National Security Council, “Ask the White House,� May 24, 2006,
http://2001-2009.state.gov/p/nea/rls/rm/2006/66736.htm.
6 “Statements on American Policy.�
7 While the Khartoum conference resolution did not rule out a political
resolution, it also stated that political efforts would be made on the basis
of the following principles: no to peace with Israel, no to recognition of
Israel, no to negotiations with Israel. See Boaz Vanetik and Zaki Shalom,
The Yom Kippur War: The War That Could Have Been Prevented (Tel Aviv:
Resling Press,2012), pp. 25-26.
8 “Statements on American Policy.�
9 See Israel Ministry of Foreign Affairs, http://www.mfa.gov.il/MFA/
Foreign+Relations/Israels+Foreign+Relations+since+1947/1947-1974/13+Law+and+Administration+Ordinance+-Amendment+No.htm
10 “Statements on American Policy.�
11 “Statements on American Policy.�
12 “Statements on American Policy.�
13 “Statements on American Policy.�
14 Quoted in Coalition for Peace with Justice website,
http://www.peace-with-justice.org/letters/041003sizer.html.
15 See note 4.
16 See note 4.
17 “Statements on American Policy.�
18 Quoted in “The West Bank Settlements,�
http://www.angel�re.com/pro/canthos/SettlementsQuotes.html.
19 The Mitchell Report, completed April 30, 2001 and published on May 20,
2001, http://www.mideastweb.org/mitchell_report.htm.
20 “Statements on American Policy.�
21 Reagan Plan, September 1, 1982. See Yehuda Lukas, ed., Documents on the
Israeli-Palestinian Conflict, 1967-1983 (Cambridge: Cambridge University
Press, 1984).
22 “Statements on American Policy.�
23 “Statements on American Policy.�
24 Speech by Ariel Sharon at the Herzliya Conference, December 18, 2003,
http://www.mfa.gov.il/MFA/Government/Speeches+by+Israeli+leaders/2003/Address+by+PM+Ariel+Sharon+at+the+Fourth+Herzliya.htm
25 White House Website,
http://www.whitehouse.gov/news/releases/2004/04/20040414-4.html.
26 The White House, Of�ce of the Press Secretary, “Remarks by the President
on a New Beginning,� June 4, 2009,
http://www.whitehouse.gov/the-press-of�ce/remarks-president-cairo-university-6-04-09
.