Writing about U.S. Middle East policy used to be a boring job. You’d start out with “The U.S. supports Israel’s stand on…” and then just fill in the details.  No longer. Many pundits claim to smell the winds of policy change blowing from the White House. Every word about the Israeli-Palestinian conflict from the president or his advisors is now parsed by journalists like so many soothsayers studying oracle bones.

Mr. Obama himself remains as cryptic as those bones and as open to divergent interpretations. At a recent press conference, he cautioned that "the two sides may say to themselves, ‘We are not prepared to resolve these issues no matter how much pressure the United States brings to bear.’"

Aha! said the Israeli newspaper Ha’aretz, Obama thinks peace “may be beyond reach.”  Meanwhile, over at the Jerusalem Post, the headline was: “Obama: U.S. Cannot Impose Peace.”

In the same breath, though, the president added: “It is a vital national security interest of the United States to reduce these conflicts because… when conflicts break out, one way or another, we get pulled into them. And that ends up costing us significantly in terms of both blood and treasure.”

Blood and treasure… Aha! the New York Times exclaimed, the president is signaling “a renewed determination to reinsert himself into the Israeli-Palestinian dispute.” “Obama’s recalibration of U.S. Middle East diplomacy is ground-shifting,” Times columnist Roger Cohen reported from Jerusalem. “He’s being pummeled from the usual quarters but he’ll stay the course.” Noam Chomsky, however, speaks for the many skeptical observers who expect Obama to stay on the old course of U.S. backing for Israel’s domination of the Palestinians.

Yet rumors of change are distinctly in the air. “If Israeli-Palestinian talks remain stalemated into September or October, [Obama] will convene an international summit on achieving Mideast peace,” says one typical report. The U.S. will no longer veto “UN security council condemnation of any significant new Israeli settlement activity,” says another. The U.S. will push for a nuclear-free zone in the Middle East, says a third.

Some Washington insiders claim that Obama intends to propose his own peace plan. Obama denies this, but were he to change his mind, Bill Clinton, for one, says he would “strongly support it.”  When White House Chief of Staff Rahm Emanuel was questioned about the possibility and he responded only, “That time is not now,” he left plenty of room for speculation that the time might be coming soon.

Such speculation is rife in Israel, where the editors of Ha’aretz advised Israeli Prime Minister Benjamin Netanyahu to “accede to Obama’s recommendations, lest it end with an imposed settlement.”

So far there’s nothing but a riot of rumors. Still, most of those rumors have been floated—think “trial balloon”—by some faction inside the Beltway, if not inside the administration itself.  Right now, the rumor mill may be the strongest weapon of those insiders eager to push U.S. policy in a new direction when it comes to Israel. In that sense, the unprecedented buzz of speculation already in the air could be considered their first victory: opening up the possibility of a serious debate in Washington (at last) about the realities of the Middle East and American policy.

Right-wingers are, in turn, mobilizing to quash that debate before it really begins. Whether they succeed—and what Obama actually does in the end—depends largely on how much countervailing pressure he feels. 

Certainly, a heated discussion on the left is now focused on precisely what steps the U.S. should take to curb the Israelis and gain justice for the Palestinians—a vital question, to be sure. Yet there’s a curious scarcity of discussion about why the administration is opening up room for debate now and, should it recalibrate policy, what its ultimate aims will be. Those questions deserve careful attention—and they turn out to be closely linked to each other.

Protecting Troops or Interests?

Obama seemed to explain his motives succinctly enough when he offered that striking warning about the risks to American “blood and treasure.”  According to the New York Times, he was “drawing an explicit link between the Israeli-Palestinian strife and the safety of American soldiers as they battle Islamic extremism and terrorism,” echoing a recent warning from Centcom commander General David Petraeus, the man in charge of the wars in Afghanistan and Iraq.

Apparently this new message from the military elite, more than anything else, is moving the Obama administration toward pressing the Israelis, as well as the Palestinians, to make real concessions for peace. As journalist Mark Perry, who first broke the Petraeus story, says: no DC lobby—not even the Israel lobby—"is as important, or as powerful, as the U.S. military."

But are U.S. military lives really the Pentagon’s chief concern? As the Times added in passing, Petraeus “has denied reports that he was suggesting that soldiers were being put in harm’s way by American support for Israel.” The general’s denial was quite accurate. When he briefed the Senate Armed Services Committee, he said nothing about troops.  What he said was that “anti-American sentiments” fomented by the Israeli-Arab conflict “present distinct challenges to our ability to advance our interests” in what Washington still likes to call the Greater Middle East.  According to Perry, the Pentagon’s private warning to the White House, too, was only about threats to U.S. “interests.”

The sole administration official who may have issued a warning specifically about danger to U.S. troops was Vice President Joe Biden, who reportedly told Israeli Prime Minister Benjamin Netanyahu, “What you’re doing here undermines the security of our troops who are fighting in Iraq, Afghanistan, and Pakistan.”

Troops or interests? The distinction is far from trivial. “Interests” are measured in national wealth and power, not the quality of individual lives. So here’s the crucial question overlooked by most observers tracking Obama’s every halting step when it comes to Middle East policy: Is the administration’s highest goal to protect blood or treasure, human lives or American interests? It cannot do both and so, sooner or later, it—or a succeeding administration—will have to choose one or the other.

That choice will be critical if the administration does indeed plan to change the Middle East status quo. Not even Obama’s most eloquent words will be enough to get the job done. Palestinian Authority leaders have shown that they won’t come to the negotiating table in a serious way without concrete evidence that they’ll achieve a viable state of their own. To achieve anything less would doom them in future elections.

On the other side, as Tony Karon has written, until there is a “downside to the status quo for Israel… things are unlikely to change.” So if the Obama administration is going to go down in history as the author of an Israeli-Palestinian peace agreement, it must do what Bill Clinton never did: Put together the right package of sticks and carrots.

It really could happen. No conflict goes on forever, and no political leaders are immune to carefully crafted pressures and inducements. But again, the president and his advisors will have to make the most basic of decisions: blood or imperial treasure? 

Here’s how the options look at the moment:

Convincing Divided Palestinians: The Obama administration has already dangled a big fat carrot in front of the Palestinian Authority: Biden’s statement in Ramallah that the U.S. is “fully committed” to achieving a Palestinian state “that is independent, viable, and contiguous.”

The Palestine Liberation Organization rejected Clinton’s peace parameters in 2000 because they would “divide a Palestinian state into three separate cantons connected and divided by Jewish-only and Arab-only roads and jeopardize a Palestinian state’s viability.” In fact, every plan Israel has ever offered, or even hinted at accepting, would leave a new Palestinian state as an “archipelago” (as the New York Times put it) of disconnected patches of land.

If, however, the U.S. turns Biden’s word—“contiguous”—into a binding commitment, encompassing virtually all of the West Bank and Gaza, it would be hard for the Palestinians to walk away.  It would be even harder if the U.S. offered another feasible and very green carrot: a promise of many dollars flowing for many years from Washington to Palestine.  That’s how Jimmy Carter bought peace between Israel and Egypt in 1978 by promising billions dollars of aid to both sides (money still flowing by the billions today).

Aid to Palestine could be presented as compensation to the Palestinians who fled their lands and homes in 1948, which might help defuse the “right of return” issue. Many Palestinians would express understandable outrage, but when former Chairman of the Palestinian Liberation Organization Yasir Arafat wrote in a 2002 New York Times op-ed that “Palestinians must be realistic with respect to Israel’s demographic desires,” he was clearly signaling that a deal could be cut. Palestinian leaders reportedly offered the same deal to former Israeli Prime Minister Ehud Olmert just two years ago.

If such a U.S. plan is to succeed, however, these carrots must be accompanied by a stick: forcing the Fatah-led Palestinian Authority to share power with Hamas. Any peace agreement that excludes Hamas is, in the long run, likely to fail.

This raises the crucial “blood versus treasure” question for the Obama administration. Thus far it has followed its predecessor in doing its best to pry the two Palestinian parties apart, while labeling Hamas a “terrorist” group bent on Israel’s destruction.

As Israeli commentator Uri Avnery recently wrote, the continuing Fatah-Hamas split "is, to a large extent, made in the U.S. and Israel… The Americans have a primitive model of the world, inherited from the days of the Wild West: everywhere there are Good Guys and Bad Guys. In Palestine, the Good Guys are the Palestinian Authority people, the Bad Guys are Hamas."

In Washington, though, the really bad guys are the leaders of Iran, who seem bent on challenging American regional hegemony in the oil-rich treasure chest of the Greater Middle East. As part of its overarching plan to forge a pan-Arab, anti-Iranian coalition, the U.S. woos the Palestinian Authority while demonizing Hamas as an Iranian stooge.  To do so, it must ignore the palpable softening of Hamas’s positions, especially toward Israel.

If the administration insists on pursuing its quixotic crusade against Iran by presenting a peace plan that excludes Hamas, the plan will probably be doomed from the start (as will any chance of wooing Hamas away from Iranian influence). In this way as in so many others, the U.S. imperial policy of containing, or even destroying, the present Iranian regime traps Washington in an endless tangle of contradictions, while maintaining an unpalatable status quo that leaves millions of lives in danger—all for the sake of protecting American dominance in the Middle East.  Think of that as the treasure option.

A U.S. policy that elevated blood—human lives—over imperial treasure would demand a power-sharing rapprochement between the Palestinian Authority and Hamas in a single state, including the West Bank and an unbesieged Gaza, that would be free to shape its own foreign policy. Hamas is unlikely to accept Washington’s calls for “moderation” that are only coded demands to accept U.S. hegemony.  Genuine Palestinian independence is the only way to end the bloodshed in the region.

Convincing Reluctant Israelis: The current Israeli government seems determined to prevent that outcome at all costs. What might induce the Israelis to change their minds?  The most obvious political weapon would be a reduction in military aid, which the U.S. now supplies to the tune of more than $3 billion a year. Though enthusiasm for Israel may be waning slightly in Congress—mainly among Democrats—there is, at present, no prospect that Congress would agree to cut that aid.

Israeli journalist Amos Harel suggests that there may be no need to follow through on such a move.  A mere leak “about an intention to reconsider the extent of U.S. military aid”—something easy enough for the administration to arrange—could suffice, shaking confidence in Israel’s long-term economic success and, Harel predicts, “affecting the credit rating so dear to the hearts of economists. Israel’s security dependence on the United States is tremendous.”

That’s an intriguing speculation, but it doesn’t get much attention in Israel, where commentators focus much more on another kind of dependence. There’s a growing fear there that the world increasingly sees it (as a leading Israeli think tank has warned) as an illegitimate pariah state.

The country’s president, Shimon Peres, recently said flatly: "Israel must forge good relations with other countries, primarily the United States, so as to guarantee political support in a time of need."  Lots of Israeli voters seem to agree. The majority “dread the global isolation of Israel,” Bernard Avishai has written from Jerusalem. He calls them "the party of America," because without continuing strong support from Washington, they fear Israel will be left isolated, with no dependable allies at all.

Columnist Shmuel Rosner, hardly a dove, predicts that if Obama "signaled that Israel could no longer take unconditional US support for granted, Mr. Netanyahu’s domestic support would quickly evaporate." Again, perhaps no more than a strong signal with a hint of real muscle behind it could get a genuine peace process rolling.

Though this issue is largely ignored in the American mainstream media, it’s huge in Israel. In fact, only one foreign policy issue is larger in the Israeli public’s mind—not the conflict with the Palestinians, but the fear of an Iranian nuclear weapon. No matter how fictional Iran’s nukes may be and how real the Israeli nuclear arsenal, the Israeli fear of Iran is all too genuine.

That’s why, along with its veiled threats, the administration has been dangling a juicy carrot for the Israelis, too: a promise of strong anti-Iranian measures, which would make it much easier for Netanyahu (or any Israeli leader) to accept an imposed peace plan and survive politically. 

Yet Netanyahu and his right-wing supporters are hardly grateful. They rightly see the U.S. playing the anti-Iranian card to pressure them into making what they consider totally unpalatable compromises with the Palestinians. And they resent it.  Their mantra is “de-linking” the two issues. They want the U.S. to ramp up the pressure on Iran without putting any further pressure on Israel to move toward a two-state solution.

The Twisted Web of Empire

The Obama administration has so far refused to consider this possibility. Apparently it’s interested only in a peace that serves imperial interests, that protects the “treasure” of regional influence, not to say domination, in the oil heartlands of the planet.

From Washington, the seat of empire, every conflict looks like a strand in a single web that spans the globe. All the contradictions in its Middle East policy are tangled threads in that twisted web. As long as the ultimate goal is to preserve imperial power, “de-linking” is not an option anywhere, and certainly not in such a vital region. Nor will an imperial U.S. risk the possibility of a less-than-subservient Palestinian government, one perhaps even friendly toward Iran. 

If the administration were, however, to place blood above treasure, it would concede that the Israeli right-wingers are indeed right about the necessity of de-linking, though for the wrong reasons. The Israelis want the U.S. to put all the focus on some imagined future threat from Iran, while ignoring the current suffering and injustices inflicted on the Palestinians by the Israeli occupation.

The alternative, truly life-saving course would be to drop the hysterical fear-mongering about Iran and its as-yet-nonexistent bomb, while insisting on a viable, contiguous, independent Palestinian state, with guarantees of security for both Palestine and Israel. Only that way can the blood of Palestinians, Israelis, and American troops be protected.  All of them would be much safer if a real Palestinian state were to come into existence with a government open to all political parties.

If the odds on such a development are long right now, the flurry of rumor and speculation suggests that everything about Washington’s Middle East policy is, at least, in flux and unpredictable. It all depends on the climate here at home. As the public’s pro-Israel tilt wanes—especially among Obama’s Democratic base—the political price for forceful U.S. intervention goes down.

The brewing debate about U.S. Middle East policy could, and should, spawn a larger debate here on the question: Is empire the path to national security or the greatest threat to national security?  Which do we value more: blood or treasure?