U.S. efforts over the last several decades to lead peacemaking between Israel and Palestine have failed. The Trump administration’s attempt to try a different, largely one-sided approach, unfortunately ended up undermining U.S. credibility amongst Palestinians. In an attempt to reestablish that credibility, the Biden administration has announced its intention to restore formal relations with Palestinian leadership. That immediate action to rebuild U.S. legitimacy as a lead mediator comes shortly after the passage of a landmark piece of legislation in Congress that will change how the United States provides foreign assistance to Palestinians and supports peacebuilding with Israel.

The Nita M. Lowey Middle East Partnership for Peace Act, part of the December budget law that also contained the latest round of coronavirus relief, will deliver unprecedented levels of funding for non-governmental peacebuilding in Israel and Palestine. The measure will likely lay a foundation for lasting security among Israelis and Palestinians.

Named for just-retired House Appropriations Committee Chair Nita Lowey (D-NY), the law provides $250 million over five years to stand up two new programs that will be administered by the U.S. Agency for International Development (USAID) and the U.S. International Development Finance Corporation to support projects that bolster the Palestinian economy and expand peace and reconciliation programs in the region. The first program is the “People-to-People Partnership for Peace Fund” that will help finance projects that support co-existence between Israelis and Palestinians. The second is the “Joint Investment for Peace Initiative,” which prioritizes support for projects that develop the Palestinian private sector while increasing cooperation between Israelis and Palestinians.

Start from the Bottom

The $50 million per year signals a new U.S. commitment towards grassroots peacebuilding. In the pre-Trump era, U.S. spending towards peacebuilding peaked at approximately $12 million and, over the last four years, has dropped to $5 million, with no funding provided to organizations in the Palestinian territories.

Moreover, economies of scale can be fully realized as other countries are able to support the fund. This follows the multilateral model of the International Fund for Ireland, which the Alliance for Middle East Peace (ALLMEP) used to advocate for the law by citing its role in helping bring peace to Northern Ireland. During a U.K. Parliament debate on the concept of an International Fund for Israeli-Palestinian Peace last November, every minister who spoke welcomed the U.S. legislation and urged the U.K. to join. Many recommended that the U.K. take one of the international board seats stipulated in the enacted law, which states that “[t]he Administrator [of USAID] . . . is encouraged to work with foreign governments and international organizations to leverage the impact of United States resources and achieve the objectives of [the law].”

What’s further remarkable is that none of the U.S. funds can be given to any foreign government, including the Palestinian Authority, the Palestine Liberation Organization, or Israel. Instead, these funds will be allocated to non-governmental and civil society organizations as well as startups that help build a base that could support lasting security, political reconciliation, trust, partnership, and economic cooperation between the two peoples. As the findings of the law state, “While the United States and its international partners continue to support diplomatic and political negotiations between the representatives of the parties to the Israeli-Palestinian conflict, such efforts require broad popular support among the people on the ground to succeed. Achieving sustainable, high-level agreements for lasting peace in the Middle East must come through, and with the support of, the people who live there.”

The focus of the law is to foster small and medium-sized Palestinian entrepreneurs and companies in order to promote long-term, well-paying jobs on the one hand, and on the other hand, support nonprofit organizations that bring Palestinians and Israelis together to advance reconciliation. The fund does this by requiring that the money be prioritized for partnerships between Israelis and Palestinians or between Arab and Jewish citizens of Israel. 

Foundational Security

In a 2017 report entitled, “Security First,” more than 200 retired Israeli generals, intelligence officers, and police officials made the case for improving the welfare and economic vitality of Palestinians as a way to ease tensions and social unrest. The roots of conflict and violence between groups often lie in economic and social strife. The Israeli-Palestinian conflict is no exception.

By supporting entrepreneurs, the funds are intended to grow the Palestinian economy in a sustainable way. While in practice this may take considerable time, such aid in conflict-ridden areas has generated considerable impact elsewhere. For instance, Syrian entrepreneurs have created over 7,000 businesses in Turkey, a dynamic that has promoted cooperation between the Syrian refugees and host communities, while also stimulating the economy. In Singapore, the island nation grew into a regional financial powerhouse after gaining independence in 1965 in part with policies supporting entrepreneurship that, in turn, created an abundance of jobs and economic prosperity.

People-to-People Peacebuilding

While economic growth can help stabilize conflict-prone settings, the second piece of the Lowey Act is no less important. In July 2016, the Office of the Quartet, which supports the longstanding Middle East peacemaking collaboration of the United Nations, the European Union, the United States, and Russia, for the first time included reference to civil society peacebuilding. The Quartet recommended parties “foster a climate of tolerance, including through increasing interaction and cooperation in a variety of fields – economic, professional, educational, cultural – that strengthen the foundations for peace.”

Research shows that conflict-management frameworks that use a people-to-people approach can be successful by promoting greater understanding, mutual trust, and cooperation between divided communities. A 2019 study produced at the request of USAID and prepared by the Notre Dame Initiative for Global Development found that three- to five years after their engagement, participants in such programs continued to report positive attitudinal change, including an increased belief in and prioritization of peace.

Despite concerns that people-to-people programs risk normalizing the status quo, these initiatives instead seek to challenge and upend it. Conflict management demands engagement with the adversary. Though power imbalances between Israelis and Palestinians are very real, organizations conducting people-to-people programs have adopted approaches that mitigate its effects and enforce a standard of equality. In these spaces, participants can discuss their lived experiences without worry of being talked over. Furthermore, Palestinians tend to know more about the daily reality of violent conflict, as they live in it in a more visceral way than most Israelis. By flattening power dynamics in a way that contributes to personal, individual sustainability and resilience, Palestinian and Israeli voices are heard as being equally important to each other.

While most participants in such activities traditionally come from the “peace camp,” organizers are getting better at recruiting those in more centrist or even right-wing brackets. For example, Siach Shalom (Talking Peace) works with rabbis of the Zionist National Religious Party as well as Islamist Imams to defuse thorny problems in real time as they create surprising coalitions of people that prioritize peace. Roots is a group of Israeli settlers and Palestinians that opposed the annexation of swathes of the West Bank last summer, yet due to their unique identity could voice those concerns directly to those most ideologically committed to it. Combatants for Peace is made up of former soldiers and fighters. Parents Circle-Families Forum is a joint Israeli-Palestinian organization composed of bereaved parents and family members, leveraging that moral authority in a way that can penetrate parts of both societies that such activism too seldom reaches. Olive Oil Across Borders works with farmers from communities and backgrounds who would not ordinarily be included in such activities.

Environmental nonprofits engaged in people-to-people programming, such as EcoPeace Middle East and the Arava Institute for Environmental Studies, also are the types of organizations that may receive funds from the Lowey Act. EcoPeace Middle East has served as a leading example for what can be achieved by bringing Israelis and Palestinians together to work on environmental protection and infrastructure projects. Similarly, the Arava Institute has created a regional forum for emerging leaders to address the Middle East’s environmental threats together, as equals.

Setting young people on a life course of activism and peacebuilding is a top priority of people-to-people programs. That’s why groups often target participants who are in their opinion-formation stage, between 15- and 30 years old. In the first 10 years of Seeds of Peace, for example, 17.5 percent of its alumni went on to build careers in peacebuilding. Field alumni now include ministers of the Israeli Knesset, such as Stav Shaffir and Ayman Oudeh, and human rights leaders like Lior Amihai. Peace-oriented public figures in both societies tend to be alumni or lay leaders from people-to-people groups. Scaling these programs up will allow a far greater degree of such fostering of a new generation of leaders whose mission and identity revolve around conflict management.

Many of these groups also apply monitoring and evaluation metrics to their methods, which the Notre Dame Initiative outlined in its 2019 report for USAID and recommended extending to longer-term studies. People-to-people organizations have ambitious, resource-intensive projects on paper that are ready to be rolled out. They have not, until now, had a source of funding that was commensurate with their ambitions. The new aid package will expand and accelerate those efforts.

Moving Forward

This new law is a stepping stone towards funding organizations that can foster peace at the local level in a conflict zone. Providing aid directly to the people on the ground, as opposed to providing it top-down through governments, has been shown to increase economic stability, build trust between divided communities, and reduce tensions.

The Biden administration should choose a multilateral framework when it implements the Lowey Act – some mechanism, as provided for in the law, that would allow other countries to contribute to the same fund – as in the case of the International Fund for Ireland, which was established jointly by Britain and Ireland and received contributions from the United States, the European Union, Canada, Australia, and New Zealand. In the case of the Lowey Act, contributions from both European and Arab states could especially enhance the legitimacy of these initiatives and, by sheer size, multiply their impact on the ground.

This unprecedented aid package, finally funding peacebuilding at a scale that could make a real difference, is bound to generate cooperation and trust among a swath of Israelis and Palestinians, and likely beyond. Powered by rigorous evaluation and learning, the initiative also could spin off invaluable lessons for mobilizing private-sector entrepreneurship and people-to-people partnerships in other conflict environments to foster long term peace and reconciliation.

IMAGE: Female Israeli and Palestinian members of the “Parents Circle Families Forum” association, an organization made up of more than 600 families who have seen a family member die in the conflict, destroy a symbolic wall representing the Israeli security barrier that runs through the occupied West Bank, in Beit Jala near the biblical town of Bethlehem, on March 10, 2017.  (Photo: AHMAD GHARABLI/AFP via Getty Images)