I feel that the ideal, just and moral solution is one secular, democratic state where Jews, Arabs and others can live in peace and security, with equal rights, and granting the right of return and compensation to Palestinian refugees.
However, in the real world we often have to settle for solutions that are somewhat less than ideal. So I would settle for a demilitarized state in all of the Gaza Strip and West Bank, with Jerusalem internationalized, and granting only a limited right of return, along with a formal apology and compensation for all refugees. These are pretty much the views of the Israeli peace camp: Gush Shalom, the Meretz party, and so on.
The latter, however, is becoming increasingly unfeasible. Israel has never offered the Palestinians a viable, sovereign state. It has refused to even entertain the Right of Return in any way, shape or form. It is making a two-state solution impossible. (And for those inclined to bring up Barak's ultimatum at Camp David:
http://fair.org/extra/0207/generous.html).
Americans must necessarily play a role in bringing about a just peace. Our dollars are used to oppress the Palestinians. Unlike pro-occupation forces in this country, we will never be able to buy elected officials. Instead, we need to build a grassroots movement and utilize educational outreach and nonviolent direct action. We need to build links with the Israeli peace movement and Palestinian civil society. We also need to reach out to our churches, mosques, synagogues, unions, and schools.
In building such an alliance, we must necessarily emphasize pluralism. The spectrum of views encompasses both positions outlined above. We must provide a big tent. Though some of us (including myself) oppose Zionism, we must not be "anti-Zionist". If we are right and Zionism is intrinsically racist and imperialistic, then this will become apparent to others in the course of the struggle. Dialogue and debate and disagreement are good, but we must not allow it to divide us.
Instead, we should all join forces and focus on the immediate goal: ending the occupation and dismantling the settlements in the Occuped Territories. No one benefits from the occupation except the American establishment, sections of the Israeli business class and some fanatical, fascist colonists. It is bad for Israelis, Palestinians and Americans.
Ending the occupation must also necessarily include destroying the apartheid wall. No one objects to Israel taking necessary measures to protect its citizens, but there's no legitimate reason for this so-called "security barrier" to stretch well beyond the Green Line.
As far as Arafat goes: yes, he's a corrupt almost-dictator. But there are few national liberation movements in history that
haven't been run by corrupt almost-dictators, and in many cases -- including the Palestinians' case -- it's almost impossible to run them in any other way. Furthermore, Israel was more than willing to look the other way when Arafat was stealing from the public treasury and torturing, imprisoning, and killing his opponents throughout the 1990s.
When people are oppressed by another nation, they're willing to throw support behind authoritarian figures. I support democracy in Palestine, but democracy simply can't develop under occupation. End the occupation and Arafat will have no justification for his practices. The Palestinian people will seize democracy themselves. For now, though, Arafat and the PLO deserve (very) critical support.
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