John Kerry and the Great Peace Blocker

US Secretary of State Kerry is about to encounter the most intractible obstacle to peace in the Middle East, one which escapes the attention of most analysts. For the mired Middle East peace process the opposing camps usually blame four things:

(1) The antipathy of Arab leaders to a Jewish flag in the neighborhood;

(2) Israeli settlement building in the West Bank;

(3) Israeli occupation; and

(4) Palestinian insistence on the demographic bomb called 'Right of Return.'

Kerry will no doubt encounter these blockers anew. But as he shuttles between the Israeli and Palestinian camps he won't hear of another one, perhaps the most obdurate of all: money. Buckets of easy money have institutionalized the conflict, making it here to stay. Even should the unimaginable happen and Kerry brokers an agreement, the problem won't retire to the margins. A monster edifice will be alive and well long after the diplomatic sideshow is consigned to the archives. You don't stop billions of cash flow, destroy a million jobs, and condemn thousands of activists to obscurity, all with a brokered settlement.

The problem is that too many fat beneficiaries sup at the table of the world's favourite conflict. At the head of the table sit the leaders of Hamas and the Palestinian Authority. Money -- a tap gushing money predisposes them not to make peace. Why would they? Search the planet for a political leader who'd disturb a state of limbo if it meant no more filthy lucre. Eighteen billion dollars of it, with hardly a string attached, has gushed from taps in Gaza City and Ramallah. That's only the sum from Western donors, for the period 2000 to 2010. What the Arab league splashed on Arafat and then Abbas would be anyone's guess.

Largesse will never incentivize people to get off their seats. Ask the World Bank. Its report in July 2012 opined that "the Palestinian economy cannot sustain statehood as long as it continues to rely heavily on foreign donations." So on what did the Palestinian Authority spend eighteen billion dollars?

Some of it went to pay 140,000 workers lucky enough to swell the payroll of the PA 'government.' These workers are the breadwinners for a third and more of the Palestinian population. Many work for the security force, which employs 58,000, or 41% on the total payroll. They are mostly Fatah members, but 'security' carries a meaning sufficiently broad to allow militants of the Al-Aqsa Martyrs Brigade, Islamic Jihad and other groups to draw a salary.

And even if they happen to be behind bars, still they receive their stipend. At this time Abbas is paying around $54 million (6% of the budget) annually to political prisoners, and convicted murderers are in the queue. In the upside-down scheme of things the prisoners never go short, while teachers and health workers are left waiting for their money.

Another part of the $18 billion went into 'development aid' though what that means depends on what Abbas and his cronies decide it should mean. The balance of the money has gone down a few deep pockets.

"Chronic Kleptocracy -- Corruption within the Palestinian Political Establishment" was the title given to a hearing of the House Committee on Foreign Affairs held in July 2012. Analysts testified before Congress on crony capitalism, endemic corruption, distortions of the market and other malpractices.

Mahmoud Abbas and sons Yasser and Tareq milk the Palestine Investment Fund for all its worth. The PIF was established in 2003 as an independent investment company, to strengthen the local economy through key investments, while maximizing long-run returns for the people of Palestine. Homemade apple pie stuff, but off balance sheet the picture looks quite different.

One of the sleaziest cases involved U.S. loan guarantees meant for Palestinian farmers and other small to mid-sized businesses being diverted to a mobile-phone firm backed by Mahmoud Abbas and Gulf investors. Steve Chabot testified at the hearing that Abbas, like predecessor Yasser Arafat, has used his position to line his own pockets, along with those of favored cohorts.

As for Gaza, foreign aid is the economy. Under the PLO much of this aid came from the U.S. and Europe, but after Hamas gained power, the Arab League was forced to step in. Iran on its own has become an important donor, funding Hamas to the tune (says Reuters) of $300 million per year. In April 2012, Hamas approved a budget of $769 million, up from $630 million in 2011. Since there can hardly be tax revenue from an economy with practically no taxpayers, $700 - $800 million per annum would be the extent of no-strings donations to Gaza. On what, and on whom, the money is spent no one knows, and cares even less.

Until the money tap is turned off no power on earth would impel super-rich, unaccountable leaders to smoke the peace pipe with Israel.

And how, unless with God's hand, will John Kerry decommission a planetary system? If finally two states emerge from a solution into the real light of day, what happens to the orbiting bodies? So many livelihoods; all those reputations and careers; such behemoth planets and moons, so much free spending, revolve around Israel and its occupation. Take UNWRA (United Nations Relief and Works Agency for Palestine Refugees in the Near East), for a big example.

When the UN agency began in 1950 it had three quarter million Palestinian refugees to care for. Today it looks after more than five million. There are 700 UNWRA schools teaching half a million children; 122 clinics and more welfare centres provide better care than Arab host countries offer their citizens. But it doesn't come cheap. UNWRA's budget is close to $2 billion, in substantial part funded by the U.S.

What if the miracle happens and John Kerry brokers a peace? How would UNWRA employees react -- some 30,000 of them Palestinians with a firm belief in their entitlement? Talk of cutbacks already led to riots in the territories. And no one in their right mind expects Arab leaders to surrender their potent weapon against Israel -- refugees. Lebanon, Syria and, Jordan putting up their hands to absorb five million? It won't happen! For 60 years Palestinian refugees have had zero rights in the Arab world, and no peace deal will change that. So, who except UNWRA will continue to look after millions of Palestinians in permanent limbo? No force known to man could help the United Nations disband the behemoth.

But other bodies, playing for bigger money, orbit the conflict. Who'd bet on the human rights industry supporting a Kerry-brokered peace, and packing up? For it being exactly that -- an industry -- only look at the sustainability factors driving the civil society organization (NGO) firms: mountains of cheap capital on demand; global reach, well-connected stakeholders, media channels beating a path to their door, and a traded commodity -- Israeli misdeeds -- for which the world has a gluttonous hunger. If those are not conditions for big business what others are there?

Nominally NGO entities are autonomous, not-for-profit and apolitical. In real life they are none of those things. There are not hundreds but thousands of entities, a bewildering number of them operating in tiny Israel and the West Bank, all competing to supply human rights product. And on the industry people depend for jobs, in their tens of thousands.

Trade is brisk, the money big and the players earnest. There are billionaire private investors, Euro zone countries that practically fling money at NGOs, ecumenical coffers, flush Arab potentates, and the proverbial Joe public. The Ford Foundation is one of the bigger investors, with an annual grant budget exceeding $500 million. Christian Aid, with branches in 50 countries, brings in €100 million and more a year, while Human Rights Watch received $100 million for 10 years from George Soros. Oxfam is bigger than all of them. With affiliates it attracts €900 million annually, a third of that from Euro Zone tax money.

These, and lesser human-rights NGOs, operate a particular business model. It gives them a vested interest in human right abuses, real or not. They leverage Israeli misdeeds as stock-in-trade, assets that convert to cash. Exactly how popular is the Israeli brand? One of the big-five, Human Rights Watch, devotes three times more resources to policing and reporting Israel than to Iran, Saudi Arabia, and the Palestinian Authority combined, and six times more resources than to reporting on Syria and Libya. Amnesty produces 255 reports per million Israeli people compared to 60 reports on Syria, 23 on Iraq and Iran, and a mere 9 on Saudi Arabia. When the Syrian regime slaughters 70,000 of its own people, Oxfam pays lip service by issuing three statements. At the same time Oxfam condemns Israel, stable and free and going about its business, nine times.

And the king of human-rights kings? The United Nations trades in hardly anything but the Israeli brand. Seventy-five percent of that body's condemnations and sixty percent of its emergency sittings relate to Israel. For human rights violations in the whole world the UN keeps just one permanent item on the agenda. It keeps one other permanent item for Israel alone.

Try telling that lot that John Kerry has brokered a peace, so they may as well pack up and look for new markets.

But not to leave out the foot soldiers. How will boycott campaigners receive a peace deal absolving the nation they love to hate? Would they accept an Israel that comes up smelling of roses? Limelight, book sales, career opportunities and, for the lucky few, celebrity status would wither away without a conflict to sustain them. 'Israel-bashing is the contemporary key to acceptance,' Professor Robert Wistrich correctly observes. Even a humble saxophone player may aspire to overnight celebrity status. 'It is Gilad Atzmon's blunt anti-Zionism rather than his music that has given him an international profile,' the Guardian explains.

Good luck and all to John Kerry. Should he overcome the peace blocker bar none, a Nobel prize would be a mean reward.

Steve Apfel is director of the School of Management Accounting, Johannesburg.
He is the author of the book,
Hadrian's Echo: The whys and wherefores of Israel's critics (2012) and a contributor to, "War by other means." (Israel Affairs, July 2012). His new work: 'How the West was won' is due out this year.