Senator Charles Percy Talks to Al-Hewar Center About
Middle East Issues in an American Political Life

On October 30, 1996, just before the last US presidential elections, Al-Hewar Center in metropolitan Washington, D.C., hosted a discussion with former Senator Charles H. Percy on "Middle East Issues in an American Election Year." Senator Percy represented the State of Illinois in the U.S. Senate from 1967 through 1984, and served on the Senate Foreign Relations Committee, including four years as its chairman.

Prior to his service in the U.S. Senate, Percy was named President and Chief Executive Officer of Bell & Howell at the age of 29 thereby becoming the youngest CEO of a major U.S. multinational business in 1949.

After retiring from the Senate in January 1985, Percy embarked on a "third career", combining elements of his previous experience in the public and private sectors and concentrating in the fields of world trade, technology transfer, and international education. He is currently Chairman of Charles Percy & Associates, Inc., a Washington, D.C.-based trade and technology investment consulting firm. Senator Percy is also Chairman of the Board of the Washington, D.C.-based Hariri Foundation, a private, not-for-profit organization whose goal is to build the human resources of Lebanon by providing interest-free loans to Lebanese students to attend colleges and universities in the United States and Canada.

Rafic Bizri, President of the Hariri Foundation, introduced the Senator at Al-Hewar Center. In beginning his presentation, Senator Percy talked about his experiences in Europe after World War II. He worked on promoting the idea of a European Common Market in order to create an interdependency among those countries and end the fighting and wars that had plagued them for centuries. He is currently working toward achieving the same results in the Middle East.

After Senator Percy's presentation, Kahlil Jahshan, President of the National Association of Arab Americans and lawyer Albert Mokhiber, former President of the American-Arab Anti-Discrimination Committee, each spoke briefly, both endorsing Percy's suggestions for greater political involvement by the Arab American community.

The presentation was followed by a discussion between the Senator and the audience moderated by Ms. Alma Abdul-Hadi Jadallah. The following Senator Percy's presentation:

* * *

What I would like to do is look back for a few minutes, and then talk about the present and the future. In looking back, as I read this passage to you, I would like you to think about the "Grapes of Wrath" [Israel's April 1996 bombardment of Lebanon] and the 170 civilians, women, children, elderly, almost all of them refugees, who were killed - 102 of whom were killed at the United Nations Compound in Qana, and the 400,000 people who were forced out of their homes with only eight hours to get out before the invasion began.

I happened to be with my son when the "Grapes of Wrath" hit Lebanon. I don't know whether or not intelligence for Israel told them I was in Lebanon, because I had come in from Damascus, but we couldn't go to southern Lebanon because the guards we had said that it was simply far too dangerous. But, I'd like to look back even farther, though, to the Congressional Record of Wednesday, February 10, 1982, and as I read it to you, you can think about what's happened since then:

Mr. Baker, Mr. President, the distinguished Senator from Illinois (Mr. Percy) and the chairman of the Foreign Relations Committee traveled during the recent recess of the Senate to many of the countries of the Middle East. On Monday of this week he spoke of the impressions gained during the trip to the National Press Club. I ask unanimous consent that Senator Percy's remarks be printed at this point in the record….

Now these are an extract of some of the remarks I made that would be pertinent to what is going on in the Middle East today:

The Middle East, of all the regions of the world, has the greatest potential for disaster. Even in times of relative calm, the clouds of war can be seen. Old antagonisms, and more recent ones, are destabilizing. Angry propaganda, surprise raids, random rocketing, massing of weaponry, vindictive UN resolutions, fears and anxiety contribute to an atmosphere of expectancy of ultimate disaster. It was against this background that I returned to the Middle East on a study trip during the Senate recess. I visited leaders of 14 nations including Israel and two thirds of the Arab states, comprising 75 percent of the population of the Arab world.

I chose to devote so much time and effort to this region because I believe that American foreign policy will face some of its most serious challenges and be offered some of its greatest opportunities in this area during the 1980s and beyond....

Despite all that binds us together, recent years have been marked by a growing number of serious differences between the United States and Israel. At times - and I view this as very unfortunate - our disagreements have tended to diminish all that holds us together....

Many Israeli acts seriously harm our relations with Israel's Arab neighbors, yet a strong American position throughout the Middle East is in Israel's interest as well.

Israel cannot expect the United States to continue isolating itself from the world community to defend questionable or objectionable actions and policies. The Israelis must stop "surprising" the international community and the United States with preemptive acts that are viewed by the community of nations as violations of international norms, harmful to U.S. interests and damaging to the peace process that must now proceed in the Middle East.

In 1982, four months following my remarks to the Senate, Israel invaded Lebanon. It was a surprise to everyone in the U.S. government except for then Secretary of State Alexander Haig.

Similarly, the recent opening by the Netanyahu government of the tunnel near the Dome of the Rock in Jerusalem also provided an unwelcome surprise to a U.S. administration, which had been trying to keep the Middle East out of the headlines in the run up to the election.

Despite the lack of progress in the peace process and Israel's attempts to renegotiate parts of the Oslo Accords, I still do have reason for hope - maybe not in the short term, but certainly in the medium to long term.

Immediately following the election of Prime Minister Netanyahu in May, the leaders of the Arab countries began an intense diplomatic effort aimed at limiting the damage the Israeli elections had done to the Peace Process. While Washington urged Arab leaders to avoid a hard line reaction to the Netanyahu victory, and instead engage in a constructive dialogue with the new Israeli government, strong elements within the key countries of Egypt, Syria, and Saudi Arabia insisted that the Likud-led government imposes a real threat to Arab interests. Finding a coordinated response to events in Israel has not been easy since all three Arab states have been forced to overcome a legacy of mutual suspicion. Each Arab state has also pursued separate agendas.

I believe that the role played by President Mubarak of Egypt has been extremely important, especially in reaching out to Prime Minister Netanyahu as he did, and to personally convey to Israel the Arab position regarding the peace process and their concerns over its possible suspension or reversal. President Assad, meanwhile has ensured a reaffirmation of Egyptian and Saudi support for Syria's negotiating position and its insistence on the adherence to the principle of land for peace.

Even King Hussein in Jordan has been able to improve his relations with Syria and Saudi Arabia and, in the process, has attempted to prevent any further regional marginalization of the kingdom by staking out a new mediating role for himself. Therefore, in the short term, everyone has benefited from this intense diplomatic initiative, except for the Palestinians. For the Palestinians, Netanyahu's victory represents a potentially serious setback. I would be interested in the reaction of some of you regarding the Palestinians in the West bank and Gaza to the actual situation on the ground. In my view the Palestinian National Authority faces pressures from all sides and faces the possibility of an explosion of popular unrest in the West Bank and Gaza if the present status quo is maintained.

The current Palestinian strategy of rallying international opinion in its favor will not have much effect on the new government in Israel. There seems to be a strong constituency in Israel that believes peace can be achieved in exchange for fewer concessions than were offered by the previous Labor led administration. The new government seems to be concentrated on its own, domestic constituency which apparently believes that the peace process is not threatened by Israel's increasingly hard line toward the Palestinians.

The attempt by Israel to change the terms of the Hebron withdrawal seems to be part of a broader strategy of lowering the expectations of the Palestinians systematically with regard to autonomy. But lowering of expectations is a double edged sword. It is clear that the main beneficiary of the promised peace in the "New" Middle East was the business sector in Israel itself. Since the election in May the previously high flying Israeli stock market has lost over 25% of its value and business confidence has been shattered.

The irony is that at the very time that prospects in the front line states directly involved in the peace process is rather grim, tremendous improvements have been realized in Arab states removed from the Levant, such as Egypt and Morocco. There seems to be a new realism in the Arab world that economic reform and market liberalization is the only hope for creating the jobs that are needed for the rapidly growing population in the Middle East. For instance in Egypt, foreign portfolio investment has gone from virtually zero to $380 million in April through September, 1996, and a new target has been announced of 90 state companies to be sold over the next two years generating 4-5 billion dollars.

Success in the peace process depends on achieving tangible benefits on all sides. Prospects for progress look bleak at present, particularly because Arab leaders may conclude that Israel's actions and interpretation of the current negotiating framework constitute a serious threat to their own interests.

John Donne could not have been more correct when he said, "No man is an Island". Today, it can truly be said that the dividing lines that separate countries are melting, as we become inextricably tied to one another through trade, technology, politics, communication, and of course understanding. I firmly believe that the pressure for peace will come within the Israeli electorate once they realize that their own hopes and dreams for prosperity are held hostage to a lack of stability and indeed growing lack of security caused by the breakdown in the peace process.

What impact will the next American administration and by the polls we can assume that this will be President Clinton, have on the politics of the Middle East? It is clear that President Clinton is driven by domestic political concerns, and even in a second administration he will be very sensitive to the Reform and Conservative Jewish groups in the United States and their view of events in Israel.

An economically weak and divided Israel is not in the interest of these groups and pressure may be brought to bear on the Netanyahu government to become more realistic in its negotiating stance. Although the $3 billion dollars given by the United States each year to Israel seems assured no matter what occurs in the short term, U.S. financial markets are much more sensitive to perception of risk. It is little appreciated how much the new Israeli economy, which is based increasingly on high tech, is dependent on perceptions on Wall Street. Seventy Israeli companies are now listed on the NASDAQ Exchange and literally hundreds of millions of dollars of investment from the United States and especially Jewish Americans are now at stake in Israel. If a rift develops between the Likud-led government and U.S. Jewry, a future Clinton administration could exert leverage if it chose to pursue this.

My advice to any leading groups of Arab-Americans is this: Let's not take our eye off the ball. The purpose of peace is stability for economic growth and prosperity for the region's people. World Bank estimates indicate that approximately $600 million worth of Arab controlled funds exist outside the Middle East. There are indications that some of these resources may now be investing in a range of projects in the Middle East along with international capital. International banks and global investors seem more willing to give Arab economies in the region, especially those aggressively pursuing reforms to liberalize their markets, more funding vehicles. The banking sector in the Middle East has become much more aggressive this year seeking project financing deals. Each nation's stake in peace and stability must be so large that isolation and obstinacy would be self-defeating. I think everyone in this room can take practical steps to ensure that the benefits of peace are realized.

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