The voluminous media commentary dedicated to President Barack Obama's May 19 speech on the Middle East has overwhelmingly focused on his extremely modest and reasonable demand that a peace settlement must be based on Israel's 1967 (that is to say, legal) borders—and the scandalized Israeli reaction. Nearly lost in all this noise is the first three-quarters of the speech, which speak to why the White House has for the first time in history embraced this minimal demand. The imperative to control the political trajectory of the Arab Spring—which is, as we have argued, what is really driving the Libya intervention—can be detected in every syllable of the transcript...

Obama (in vivid contrast to his predecessor) is a skillful propagandist, with a keen political eye, and an ear for progressive voices. He correctly notes (as we have) that al-Qaeda has been left behind by events since the start of the Arab Spring (and even refrains from too unseemly self-congratulation on offing bin Laden):

By the time we found bin Laden, al Qaeda's agenda had come to be seen by the vast majority of the region as a dead end, and the people of the Middle East and North Africa had taken their future into their own hands.

But note the admirable subtlety with which he states that the US empire must impose a capitalist cast on the Arab revolutions:

The question before us is what role America will play as this story unfolds. For decades, the United States has pursued a set of core interests in the region: countering terrorism and stopping the spread of nuclear weapons; securing the free flow of commerce and safe-guarding the security of the region; standing up for Israel's security and pursuing Arab-Israeli peace. We will continue to do these things, with the firm belief that America's interests are not hostile to people’s hopes; they're essential to them.

Did you catch that reference to "securing the free flow of commerce"? A few short years ago, the US was about to move ahead with a Middle East Free Trade Agreement (MEFTA)—and certainly backed tyrants like Mubarak for all those decades because they were committed to pro-capitalist (as distinct from pro-democratic) "reform" (as well as because of their willingness to betray the Palestinians). Now, the future of the region seems like it's up for grabs. And even if there hasn't been any explicitly socialist direction to the Arab revolutions, Washington must certainly be worried about the critical role of militant labor in bringing down Mubarak's regime.

So, how to ensure that the awakening Arab world continues to go along with the agenda of pro-capitalist "reform"? First, by seeming to embrace the revolutionary movements. Hence:

The United States opposes the use of violence and repression against the people of the region. (Applause.)

Uh-huh. But not to the point of being unwilling to fund it. And:

America values the dignity of the street vendor in Tunisia more than the raw power of the dictator.

Oh? Did the US ever even threaten to cut off aid to Ben Ali? Not that we've heard.

Unfortunately, in too many countries, calls for change have thus far been answered by violence. The most extreme example is Libya...

Yes, but US client states have also made pretty dramatic "use of violence and repression" in recent weeks. To his credit, Obama actually mentioned some of these, including Yemen and Bahrain—although not Saudi Arabia. Obama pledges that "it will be the policy of the United States to promote reform across the region, and to support transitions to democracy." Yet, oddly, US-made tear gas and bullets continue to fly at protesters in Sanaa and Aden. When Obama gets down to specifics, they aren't about "transitions to democracy," but to unrestrained capitalism. He cites four initiatives: First, he will call on the World Bank and International Monetary Fund "to present a plan at next week’s G8 summit for what needs to be done to stabilize and modernize the economies of Tunisia and Egypt" (in other words, good-bye to the last remaining Nasser-era restraints on Western access to local labor and resources). Second, a program of debt forgiveness for Egypt (to win the good will of Egyptians during this capitalist transition). And:

Third, we're working with Congress to create Enterprise Funds to invest in Tunisia and Egypt. And these will be modeled on funds that supported the transitions in Eastern Europe after the fall of the Berlin Wall. OPIC will soon launch a $2 billion facility to support private investment across the region. And we will work with the allies to refocus the European Bank for Reconstruction and Development so that it provides the same support for democratic transitions and economic modernization in the Middle East and North Africa as it has in Europe.

AFP informed us March 11 that senators John Kerry, Joe Lieberman and John McCain have introduced a bill calling for the creation of such Enterprise Funds, "modeling their legislation on a hugely successful [sic] effort to help [sic] former communist countries in Europe after the Berlin Wall fell." (Both Kerry and McCain, not coincidentally, are also among the Hill's most aggressive supporters of aid to the Libyan rebels.) OPIC is the Overseas Private Investment Corporation, which basically serves as a government insurance company for big corporations in case their foreign assets fall victim to (*ahem*) unrest or revolution.

Fourth, the United States will launch a comprehensive Trade and Investment Partnership Initiative in the Middle East and North Africa. If you take out oil exports, this entire region of over 400 million people exports roughly the same amount as Switzerland. So we will work with the EU to facilitate more trade within the region, build on existing agreements to promote integration with U.S. and European markets, and open the door for those countries who adopt high standards of reform and trade liberalization to construct a regional trade arrangement. And just as EU membership served as an incentive for reform in Europe, so should the vision of a modern and prosperous economy create a powerful force for reform in the Middle East and North Africa.

Note how all the explicit references to democratic reform have disappeared from his rhetoric once he is actually down to brass tacks. Now, with refreshing honesty, it's all about "trade liberalization." And that "Trade and Investment Partnership Initiative" basically means another shot at MEFTA.

Prosperity also requires tearing down walls that stand in the way of progress—the corruption of elites who steal from their people; the red tape that stops an idea from becoming a business; the patronage that distributes wealth based on tribe or sect.

Again, very nicely done. The corruption and patronage are genuine grievances of the Arab protesters. But US "free trade" efforts have a habit of eliminating such "red tape" as labor protections, environmental regulations and social safety nets.

Now, the final critical point in assuring that the awakening Arab world continues to go along with this agenda: Palestine—the conflict that Obama rightly notes "has cast a shadow over the region." Here's Obama's offending passage:

[W]hile the core issues of the conflict must be negotiated, the basis of those negotiations is clear: a viable Palestine, a secure Israel. The United States believes that negotiations should result in two states, with permanent Palestinian borders with Israel, Jordan, and Egypt, and permanent Israeli borders with Palestine. We believe the borders of Israel and Palestine should be based on the 1967 lines with mutually agreed swaps, so that secure and recognized borders are established for both states. The Palestinian people must have the right to govern themselves, and reach their full potential, in a sovereign and contiguous state.

What's really maddening is that even with the reference to "mutually agreed swaps"—itself a potentially dangerous compromise—the passage has still elicited this outraged Israeli response. Prime Minister Benjamin Netanyahu bluntly retorted that the 1967 borders were "indefensible" and Israel is not going back to them. In an Oval Office appearance after two hours of talks the day after Obama's speech, Netanyahu warned that a "peace based on illusions will crash eventually on the rocks of Middle Eastern reality... I think for there to be peace, the Palestinians will have to accept some basic realities." (AFP, May 20) Like bantustans divided by permanent Israeli settlements and security walls instead of a contiguous state.

Danny Danon, a Likudnik who is a deputy speaker of the Israeli Knesset, had a New York Times op-ed the day of Obama's speech with the utterly sinister title "Making the Land of Israel Whole," which included a blatant threat to annex the Occupied Territories:

In 1995, as part of the Oslo accords, Israel and the Palestinians agreed that “neither side shall initiate or take any step that will change the status of the West Bank and the Gaza Strip pending the outcome of the permanent status negotiations.” If the president of the Palestinian Authority, Mahmoud Abbas, and prime minister, Salam Fayyad, decide to disregard this section of the accords by seeking United Nations recognition of statehood, it would mean that Israel, too, is no longer bound by its contents and is freed to take unilateral action... [A] United Nations vote on Palestinian statehood would give Israel an opportunity to rectify the mistake we made in 1967 by failing to annex all of the West Bank (as we did the eastern half of Jerusalem). We could then extend full Israeli jurisdiction to the Jewish communities and uninhabited lands of the West Bank. This would put an end to a legal limbo that has existed for 44 years.

The Wall Street Journal reported the day of the speech that "Jewish donors and fund-raisers are warning the Obama re-election campaign that the president is at risk of losing financial support because of concerns about his handling of Israel." Malcolm Hoenlein of the Conference of Presidents of Major American Jewish Organizations darkly warned: "It's that people hold back, people don't have the enthusiasm and are not rushing forward at fund-raisers to be supportive. Much more what you'll see is holding back now."

Netanyahu's response to the Hamas-Fatah deal, which will hopefully put an end to the years of Palestinian internecine violence, was also both swift and predictable. "The Palestinian Authority must choose either peace with Israel or peace with Hamas," he said in a televised speech shortly after the reconciliation pact was cemented in Cairo. "There is no possibility for peace with both." (Toward Freedom, May 10)

The most ironic thing is that, if only the Israeli leadership could see it, Obama's statement on the 1967 borders is part of his effort to domesticate the Arab Spring—which is in their own interests (although not in Jewish enlightened self-interest). The denial they demonstrate over the need to relinquish control of lands they have no right to rule smells more and more like that demonstrated by Indonesia and Serbia in their blood-drenched but futile efforts to hold on to East Timor and Kosova. Let's hope that's not where it's headed.

See our last posts on the Arab Spring, Israel, and the struggle for Palestine.

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