Aaron David Miller on the Future of Israeli-Palestinian Peace

Welcome to The Puck, Venture Capital and Beyond, a show that examines the changing landscape of our world. Before we dive in, a quick word about who I am and why we're here. I'm Jim Bier, corporate lawyer and restructuring professional. I've spent the last two decades helping companies navigate their toughest transitions. And about eight years ago, I found myself having fascinating conversations with clients and friends about everything from venture capital to the broader shifts happening in our economy and society.

Those discussions were simply too good, so the puck was born. Now while we started on venture capital, hence the podcast name, the Puck Venture Capital and Beyond, we've naturally evolved to focus more on the and beyond portion of the title. Today, we explore how business intersects with the bigger forces shaping our world. I still run my restructuring practice by day, but now I get to host these conversations by night. It has become one of the most rewarding parts of my life.

Today's guest continues that tradition. I think we really have not seen in the modern history of the Israeli Palestinian conflict the conditions necessary to actually achieve a breakthrough and produce an agreement. As violence flares in Gaza and The Middle East teeters on the edge of a wider crisis, the puck turns to one of America's sharpest foreign policy minds, Aaron David Miller, a senior fellow at the Carnegie Endowment for International Peace and a former State Department analyst and negotiator in Republican and Democratic administrations. Aaron David Miller, I wanna welcome you to the Puck. It's great to be here.

Thanks so much for having me. Our pleasure. And in that regard, before we jump right in, do you wanna just take a moment and tell our listeners a little bit about your background? Yeah. I spent, well, ever since the fifth grade, all I ever wanted to do was be a history professor.

But I ran into two guys at the University of Michigan who both been foreign service officers. Actually, one worked for CIA. Then they came to the university, and the stories they told just motivated me. So I basically changed fields from American diplomatic history to Middle East history, got married, packed up, and the only place you could study Arabic and Hebrew is living languages in 1973 was Jerusalem. And, everything was fine until the October war broke out, and then my career aspirations and frame changed again.

I didn't wanna be a history professor. I thought I could, without appearing presumptuous or pretentious, maybe play a small role in helping Arabs and Israelis sort out their problems. So I came back, got a PhD, came to Washington, and started working for the Department of State. And for almost twenty seven years, I played a role as an analyst, first as a historian, actually, an analyst and then as negotiator, advising both the Republican and Democratic administrations. I left the state department shortly before the second Bush administration invaded Iraq, March of o three.

I had spent the last twenty plus years trying to create a baseline, an analytical baseline, on what we got right and what we got wrong and whether there was any hope, frankly, which is now in obviously short supply to try to help resolve a a conflict between Israelis and Palestinians that has proven to be intractable. So that's the story, in a nutshell. Just one last point. I borrowed a phrase from Jack Kennedy, who was the last president to, have an emotional impact on me. He described himself as an idealist without illusion.

And I I borrowed that from Kennedy because that's where I am. I don't say never. I'm not naive, but I have two kids, two grown kids and four grandkids, and I I won't mortgage their future by saying never. The road to Israeli Palestinian peace is gonna be a long and winding one, not not to borrow from. One of my favorite favorite Beatles songs, but you can't give up, basically.

So idealism married with with no illusion seems to be about the right combination. So I love that. And I do wanna circle back to your idealism at some point in terms of kind of your view that you you you could make a difference and so forth. But in your book, The Much Too Promised Land, I mean, you you talk about breakthroughs. You talk about failures.

In terms of missed opportunity in the past, I mean, was there any specific misstep in one of the major peace efforts that you feel should have been a turning point but but wasn't? You know, I thought for a while when we went to the second camp, David, Jimmy Carter did the first one related to The Middle East in September '19, '78. But we went to the second camp, David, with Bill Clinton, who cared more, tried to do more, I think, than any other American president on the Israeli Palestinian issue. We brought Ehud Barak and Yasser Arafat to Camp David for thirteen days. I think I had no illusions that, in fact, there might have been an opportunity.

This was the last time that you had in one place for almost two weeks an empowered American president, last six months of his second term, a Palestinian leader who had legitimacy, and a an Israeli prime minister who, I think, was prepared to go further on these issues than any of his predecessors, but not far enough to actually create a basis for an agreement. I thought at one point that Camp David was a huge missed opportunity. That was twenty five years ago, two weeks ago, and it's hard to believe July 2000. But, on reflection, I don't think, despite Clinton's dedication, that that was a missed opportunity. I think we really have not seen in the modern history of the Israeli Palestinian conflict the conditions necessary to actually achieve a breakthrough and produce an agreement.

I don't think we've seen the three or four conditions that are necessary to have a chance to do that. So on reflection, under the right circumstances with the right leaders, with an American president that was prepared to be tough as well as reassuring to, apply what a former US ambassador to Israel called enough honey and enough vinegar with two leaders, an Israeli and a Palestinian leader who are masters of their houses, political houses, not prisoners of their ideologies. You could envision, I think, something that is now just a thought experiment, more tethered to a galaxy far, far away than the realities back here on planet Earth, which would be, I choose my words very carefully, a conflict ending solution so that an Israeli prime minister and a Palestinian president could stand before their respective by, parliaments, the Knesset and the Palestinian legislative counsel in the Palestinian case, and say the following. We don't love each other. We may, right now, not trust each other.

But on the four or five core issues, border security, refugees, Jerusalem, and the end of all claims and conflict, we're done. No more claims to be adjudicated. No more irredenta to be pursued. We're done. It's over.

I I can't give up on that. I don't have the right to give up on that. Certainly for my own kids and grandkids, not to mention future generations of Israelis and Palestinians. But getting there, particularly in the wake of October 7, is gonna be torturously difficult. Well and and I've I've heard you speak about this issue a lot, and and I it's near and dear to my heart as well.

One of the questions I have is we've seen reformations take place within Christianity. We we've seen that fundamentalism on the left or on the right from my perspective doesn't lead to compromise and the desire for a win win solution. When you look at the world, there are certain areas that are more intense than others. It seems to me that to call The Middle East an intense place is an understatement. When you look at the fundamentalist beliefs and and when you look at people that have a a real righteous belief that their way are the highway, and they have money and arms and are willing to continue to fund people that just wanna see from the river to the sea.

Until the world gets together, and I mean China, the United Nations, and otherwise, and basically says we're putting an end to this fundamentalism, How do you ever get a majority of your population together to be able to create a lasting peace? Well, I mean, I think it's a it's it's it's a critically important question. I don't put much stock, frankly, in the world, the, vaunted international community with a capital I and a capital c. Because I think you witnessed since October 7, it's hard to believe in October, it'll be two years, A international community that is divided, distracted, self interested, unwilling or unable to focus enough attention or pressure, frankly. I think the answer lies in, again, I default to the issue of leadership because I don't see how you get there without it.

It it's necessary but not sufficient. Every time there's been a breakthrough in this conflict, whether it was on process or substance, whether it was Menachem Begin, Jimmy Carter, and Anwar Sadat at the first Camp David in, September '78, whether it was King Hussein and rub the late prime minister Rabin in the Israeli Jordanian Peace Treaty, or whether it was president Bush '41 and, his eminently talented secretary of state, James Baker, putting together the Madrid peace peace conference in October ninety one or the Oslo process, which was a heroic lift by Israelis and Palestinians, which failed ultimately, it always involved leaders who were willing to risk. And if I had to identify the one factor that that might address the concerns that you raised, it really does come back to leadership. I don't think I look at apartheid in South Africa, and I think to myself, what were the chances that apartheid would end without massive violence and bloodletting? And I never thought I could see a pathway out of South African apartheid that would at least allow South Africans, black and white, mixed race to create anything that resembled a functional governing structure without some massive trauma.

And yet Mandela and de Klerk emerged, and it's a troubled pathway, but it was their leadership in in the main that broke this conflict open. So I keep coming back to this issue. The problem is that I don't you look around, I I don't see this. I see extractive leaders. I see in the current Israeli government and certainly in whoever is making the decisions internally for Hamas.

I'm told it's a brigade commander. The Israelis have killed most of the senior veteran leaders of Hamas or Mahmoud Abbas, the putative president of Palestine, who is perceived to be corrupt, nepotistic, without credibility. I don't see that kind of leadership. But without it, you know, The Middle East is littered with the remains of great powers who wrongly believe they could impose their will on smaller ones, and and it's proven very resistant. When things happen that are good, it's almost always because you have leaders who are willing to bring their respective publics along.

That to me still is critically important. And when you look at developments like the Abraham Accords and the shift in Gulf State strategies and and also what's going on with Iran today, I mean, are there things that you think will shape the future that could lead to the the the major changes you're talking about? I mean, you know, the Abraham Accords were quite significant, but they were agreements that I I would describe to you as out of conflict zone agreements. There was a reason that the The Emirates, The UAE, and the Israelis could come together in an extraordinary way that they have, making the Egyptian Israeli peace treaty from 1979 or the Israeli Jordanian peace treaty from 1994 seem cold peace, in comparison to how the Israelis and The Emirates have bonded. But they had a distinct advantage.

They had never been in conflict, and The Emirates were distant from the Arab Israeli confrontation line. The Emirates had very little in the way of of internal domestic politics or resistance to these agreements. So that sort of peacemaking came along at at a much faster rate, and and it's endured. The Abraham Accord agreements, Israel Bahrain, Israel UAE, potentially, at some at some point, Israel Saudi, they've survived. Perhaps the most traumatic, bloody Israeli Palestinian conflict.

And the Gulf States would have to play a key role in both supporting the Israelis and the Palestinians as they make tough decisions. But I don't see the possibility of an interstate peace proceeding in any meaningful way the problem of the Israeli Palestinian conflict, which is an established state seeking to come to terms with a non state actor, Palestinians writ large. So, yeah, the Gulf states have a key role to play, no doubt. And Israeli Saudi normalization would be an important piece of this, although it's not likely to happen unless you had an Israeli government that was prepared to at least take initial steps toward some sort of, political horizon for the for the Palestinians. Iran is a completely different order of magnitude of problem.

It's a regime that has a profound sense of entitlement on one hand and a profound sense of insecurity on the other. I think Henry Kissinger once described it as a sort of revolution in being, although the Iranians have acted with much more deliberation and pragmatism in the wake of their weakening role in the region. I I I mean, some argue you couldn't have Israeli Palestinian peace as long as the Iranian file remains open. I don't know what closing the Iranian file actually means because this is a regime that prides itself in a sort of revolutionary ideology even while it can behave pragmatically. And, you know, in the words of my one of my Carnegie colleagues, Karim Sajapur, Iran has three sort of objectives.

One is beating back American influence. The second is eradicating Israel. And the third is the hijab, the whole notion of making sure that women play the role in Iran's conception of women in Islam that they should play. I don't see how you and then you have, of course, the new the nuclear issue. It's hard to imagine any of that coming around anytime soon.

So I don't think the Iranians have a, certainly not a constructive role to play. I guess the question is, could you limit the destructive role they could play partly through the the possibility of a negotiated agreement on the nuclear issue or, alternatively, a change in regime. But even that might get you to a regime that is far more militarized, much less clerical, and more determined than ever to remain an a nuclear weapons threshold state. That is to say, having all the ingredients of what would be required to make a nuclear weapon, but, refrain from weaponizing. Iran's gonna be a problem.

I pointed out to somebody the other day that if you if you asked me who are the three most consequential powers in the region, Without a doubt, I would say the three non Arabs, Israel, Turkey, and Iran. They are the only states that have the capacity to project their power beyond their borders for good or ill. One is a member of NATO. One is America's closest ally, whatever the tensions are between the Netanyahu government, Biden, and Trump. And a third is Iran, much weakened over the last two years, but still is going to be a key part of the Middle East conversation for a long time to come.

So you you talk about leaders, but leaders have to have ideas, and they have to be able to be bold. When you look at the history of this conflict and you look at the types of bold things that could be done, what what ideas have you seen or heard about today that you think could change the conversation? Oh, I mean, Sadat changed the conversation by deciding after a series of discreet conversations through his emissaries with the Begin government, decided to, in one of the most extraordinary acts of statesmanship of the twentieth century, decided to get on a plane and land in Israel and then address the Israeli parliament, the Israeli Knesset. Sadat was a unique figure. It cost his peacemaking, cost him his life in 1981.

I I I have to say, I am not a proponent. Maybe it's because I've watched the region, immersed myself in so much of it for so long that I don't believe in transformations anymore. And I think that part of the reason we are led to believe that transformations are possible is because many respects we lack perspective, but I think the media in its various forms, since it responds almost instantaneously to a twenty four seven news cycle, also lacks the kind of perspective. I was told COVID would be a transformational event, that the world would never be the same after COVID. Much changed to be sure, but how much really did change?

Was COVID a real transformation? I mean, some would argue it was the most single world altering event since the end of the second World War in terms of the way it affected so many people in so many places. I was then told that Russia's invasion of Ukraine would would create a huge transformation in European politics and international relations, and the world will never quite be the same. I'm not sure that that is, in fact, the case. There are studies done by a professor at the University of Chicago in conjunction with Uppsala University in Sweden.

They took a look at every interstate conflict, not between not within states, but between states since 1815. The average length of an interstate conflict since 1815 was three months. If it lasted a year or more, the conflict would turn into a multiyear confrontation. So we're, you know, we're in the fourth year. Right?

I got math right. Yeah. Well, the third year would be February 2022 of the Russia Ukraine conflict. It shows no prospects of ending. So when it comes to Middle East, I just have a hard time in October 7, which clearly scrambled the deck and resulted in a lot of changes, but I don't.

I'm not sure I would point to any single change that for good or ill, that I would consider anywhere near transformation. So I try not to I said to somebody the other day, I I actually did an interview, wouldn't it be extraordinary if Donald Trump got on a plane and went to see his good friend, Mohammed bin Salman, putative next king of Saudi Arabia, aka MBS? And he said, we're gonna take a little trip to gather up Arab foreign ministers from any number of countries. We're going to Jerusalem, and you and the and Arab foreign ministers are gonna address the Israeli parliament. And you're gonna lay out exactly what you need and you're gonna tell them what you are prepared to do, in essence, if those needs or even as those needs were met.

But you're gonna be there. So Israelis, the world, Palestinians, everyone can see. Now that is an that's an event that is more appropriately tethered to a galaxy far, far away rather than the realities back here on planet Earth. But, nonetheless, are you asked for something that had a potentially transformative impact? Might be something like that.

Is there any and and that makes sense. And and, you know, certainly, I mean, Jared Kushner and I think Trump have have thought about trying to do those types of things. Here here's another question. When you look at economics and you look at the role that China could play, I understand that we're living in this world of a zero sum where, you know, essentially, China likes to see us distracted and so forth. But, you know, at some point, Israel is in a really tough spot.

And at the end of the day, they are in a tough neighborhood. And to me, if you look at what happened in '19, you know, '47 and '48. Right. You know, the UN and Truman and everything put Israel in this in this situation. And it seems to me that the world has this issue.

It's it's not something that can be just solved unilaterally because, again, if you make peace but Iran continues to funnel weapons to those fundamentalists that wanna see you destroyed, it it doesn't work well. And when you look at what happened with Reagan when we had troops on the ground and the barracks were bombed, this is, again, a tough neighborhood. And I guess my question is, is there any chance you see that whether or not it's Israel putting leverage on China by saying, look, when you look at these oil fields, guys, I mean, at the end of the day, you know, we don't wanna disrupt the oil supply, but on the other hand, we also do not wanna be bled to death here. Is is there any way to leverage China into helping? I mean, you know, the Chinese view of The Middle East is is a a sort of a bifurcated one.

They want the status first of all, it's it's largely commercial. They have one military base, Djibouti. Chinese don't wanna get in the middle of this because getting in the middle of this would force them to choose to make choices and would alienate and make harder what one of China's major strategic goals are, which is to isolate The United States and turn the global south, a complicated concept to be sure, much I mean, in the direction of Beijing rather than Washington. Chinese are also, when it comes to electric vehicles and solar, trying to wean themselves off of a supply chain that even they know will make them incredibly vulnerable, which is weaning themselves away from hydrocarbons. I don't think the Chinese and they brokered a an Iranian Saudi detente.

I mean, I used it. Yeah. Relaxation of tensions is how I would describe it in 2022. But I don't see the Chinese playing a strategic a a a big strategic role, and that goes for the Russians as well for many different reasons. At the end of the Assad's in Syria, Russians maintained their warm water ports, Tartus, Latakia.

Some of their strategic weapon systems have been removed, and they clearly don't have the kind of influence over the current Syrian government they did for decades, both under the elder Hafez al Saud or his son, Bashar, who is now, as you know, offered asylum in December when he had to flee the country. I don't see the great I don't see either of those powers. And, again, their goal is also to try to keep The US at bay, but I don't see China or Russia playing the kind of role that the Americans could play. But, again, I know the temptation and tendency to because of how hard it is to deal with Israelis and Palestinians themselves, given the current lack of leadership. It's completely understandable that the default position would be, well, if the Israelis and Palestinians won't or can't do this, let's think about how this the world, the international community, the great powers, The US, the UN, could somehow find a way to leverage them, pressure them, create incentives for them.

It's just looking at the well, the essence of this, Jim, is The US Israeli relationship. And by and large, let's be clear. We haven't talked about it. Well, let's be clear. I served in every administration from Jimmy Carter to Bush '43.

No American president that I worked for saw a great advantage. Several did it, but saw a great advantage to pressuring or fighting with the Israelis. It could be politically costly. Usually, it didn't work. Although Carter, Nixon, and Bruce forty one, those three, were able, at discrete moments, to press Israel to the advantage, frankly, in the end of both The US and Israel.

But I don't see when when we talk about leverage, if we talk about the one party forget the Chinese and the Russians. We'll talk about the one party that actually has leverage over Israel, and that's us. That twelve day war against Iran, our deployment of the THAAD, anti missile defense system, terminal high altitude defense, we burned through months of our stock at a cost of billions in helping Israel turn back cruise and ballistic missiles and drones that the Iranians were were launching. So does the leverage exist? You bet it exists.

Are American presidents reluctant to use it? In a systematic and sustained way, the answer is absolutely yes. The last American president, the only one, who actually was prepared to really pressure Israel and was prepared to to, deploy both economic and political sanctions. Eisenhower even reminisced in his memoirs that he would unless Ben Gurion withdrew Israeli troops from Sinai as part of the French British plan to take Israeli plan to take back the Suez Canal and depose then president Gamal Abdel Nasser of Egypt. He was thinking about committing American forces.

Eisenhower was the last president, the only one, forget the last, the only one to threaten and he would have done it to threaten that kind of pressure. So the leverage we have, the interest capacity ability to use that leverage, I mean, episodically, yes. But rarely, if ever, on an issue that the Israelis believed was somehow vital or critical to their security. And, you know, Jim, when I think about it, we don't do we don't do well in leveraging any of our partners, allies, and friends. We really don't.

Well, but, Dan, let me jump in for a second because, again Yeah. If you look at the PR war right now, I mean, I think Israel is losing. I mean, if you look at the young people in America, if you look at young Jewish in America, there there is a tremendous amount of frustration and anger at at Israel and and watching on Facebook and on TikTok the images coming out of Gaza. Yeah. Let's say for sake of argument, you you know, because the puck, where's the world going?

Let's say that, for instance, we we did exercise this leverage. And to what end? In other words, if you I don't when you say leverage, like, whether or not we we we we impose a two state solution, for instance. I mean, Gaza was somewhat independent after 2005 is my understanding. If you if you imposed a a two state solution or you use leverage and you you ended the conflict right now, at the end of the day, how do you then bring a lasting peace when if Iran continues to supply arms and if Hamas or another organization recoups, as long as there's an unwillingness on the, again, non Arab world or the Arab world to impose on the, quote, Palestinians and on Iran a a blockade of sorts to keep weapons out of the West Bank and out of the Gaza Strip.

Even using this leverage, how does that lead to a lasting peace? I think look. If you could get a the two state solution with all of its problems, my judgment is the it's the least worst solution, and it's the only one. Let's call it separation through negotiation. If you could actually create a framework of separation through negotiation, two states, state of Israel, coexisting in peace and security alongside the punitive state of Palestine, and you would add to that, my fantasy of having key Arab leaders and heads of state actually recognize Israel, you would create a situation where, yes, there would be extremists, a lot of very unhappy people, particularly the ones who have guns.

But in the face of that, in the face of those regional real new regional realities, I think rather than providing a mortal threat to this sort of new Middle East, I think you could minimize the damage and the danger that Iran or its proxies, Hezbollah in Lebanon, the Houthis in Yemen, pro Iranian militias in Syria and Iraq. Middle East is gonna remain a very unstable place, Jim, for a long time. Why? Because you have five Arab states. Let's count them.

Lebanon, Syria, Iraq, Libya, and Yemen in various phases of political or economic and security dysfunction. This is not a land of opportunity. But if you could create that that sort of I don't know what what's the word for it. That sort of new new reality, I think you you really would change. It would it really would be transformative.

And remember, when we talk about leverage, we talk about pressure on Israel, we talk about three basic baskets. Number one, conditioning or restricting US military assistance. Number two, essentially, no longer defending Israel in international fora, including the UN, or before the International Criminal Court or the International Court of Justice. And number three, as as you implied, taking a much more proactive view on the issue of Palestinian statehood or or even recognizing, which a 140 plus countries in the world, not The US, have already done, recognized the state of Palestine. So the leverage is there.

It's hard to believe. Since this is the puck, let's be and we're looking to the future. Here's my acid test. And you're right, by the way, about changing American attitudes toward Israel. Look at the Pew poll from last month.

53% of Americans and you break it down with almost a Democrats, it varies. The it's a mirror image. But 53% of all Americans polled had an unfavorable view of Israel. And the younger generation is not going to get any more favorable under current circumstances. My acid test where the puck would go as to when The US Israeli relationship would change is when I see significant numbers in both the house and senate debating openly without fear of political sanction or consequence.

Two things. Number one, the nature of The US Israeli relationship, and do we knee really need to be to supply a country that is extraordinarily dynamic, resilient, and wealthy with $3,800,000,000 of foreign military financing a year? That's one issue. And the other is Israel's treatment of the Palestinians. Well, I see significant numbers of Republicans and Democrats debating these two issues in the House and Senate.

You'll know that the nature of The US' relay relationship is going to change. There's some evidence to that, but it's a headline. Whether it turns out to be a trend line or not is gonna depend very much on whether or not the wheel is going to turn in Israel with respect to the issue of leadership. Because Benjamin Netanyahu, longest governing prime minister in the history of the state of Israel, presiding over the most right wing coalition in the history of the state of Israel on trial for bribery, fraud, and trust in in the Jerusalem District Court before three judges four years running is undermining the very fabric, my judgment, and character of this relationship. And when the image of Israel and it is changing.

When the image of Israel changes in the mind of America, when most Americans no longer believe that the Israelis are, in a the broadest sense of the word, committed to the same kinds of values, pluralism, democracy, then the nature of the relationship is going to change. Well, you heard it here first. Politics is obviously something that shifts a lot, but I certainly, in my lifetime, have not seen sentiment switch as as as dramatically in terms of the young people's view of Israel. You know, you go back to the Pew report even five years ago in terms of the positive view that people had towards Israel and and Jews, and you look at, again, how it's flipped. So unless something really, really dramatically changes on the ground and and, you know, with a million more people living the way they're living, it's hard to imagine how that public perception changes anytime soon.

Right. It it seems to me if you look at trends politically, you you got people aging out and then you've got people coming up. The the trend, especially if you look at the Democratic party, the the trend for friends of Israel is is is wavering right now in a way I've never seen it before. And so I I that does, to me, creates danger, but it also creates opportunity. Yep.

This has been wonderful. No. It was great. I enjoyed the conversation, Jim. Your questions helped me organize my own thinking, which is really, really important for me.

So I thank you for that. That's humbling. I pre I appreciate the kind words. I mean, we're dealing with such complex issues. They're so emotional.

And I know that as a Jew and and and having friends that reach out to me that are just so horrified about what's going on right now that I shudder at what we as Jews and and what the Israelis can do to try to create Yeah. A a more humane lasting peace in that part of the world. Yeah. I I share your concern. The top venture capital beyond is produced by CMVG Advisors.

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