One Israeli peaceful option is to give Palestinians their own state unconditionally, transfer the relevant Palestinian territories to them and withdraw the Israel Defense Forces. The Jewish settlements could stay with administrative autonomy under Palestinian jurisdiction protected by Israeli threat. As a sovereign state, Palestine would be hard pressed by Israel and the world to control anti-Israeli violence and protect the Jewish settlements. Bureaucratic states are often more tolerant than their founders, and Palestine would exercise restraint with the Jewish settlements since they have a powerful Israeli sponsor next door.
Israel could lobby the international community to declare Palestine a terrorist state. The nations that created Israel seem to think that, statehood achieved, Israel should be content and grateful—and submissive in the face of Islamic aggression. That attitude explains their disregard of Israel’s security when they pressure Israel to give in to Arab demands. The same attitude will emerge toward a Palestinian state, making it easy for Israel to push it around.
Israel will be free to retaliate against a Palestinian state, not restraining Israel Defense Forces to police actions. The Palestinian leadership will no longer be able to avoid its responsibility to maintain order and tolerance to Israel in the Palestinian territory. If it does not, Israel will have sufficient cause to dismantle the failed state on Israeli borders. The whole Palestinian population will be legally responsible for Islamic terrorist actions aiming on Israel and originating in Palestine. Israel will not need to search out Islamic terrorists nests but Israel Defense Forces will be free to strike any target within the Palestinian state in retaliation. Israel will need only to show world public opinion that the Palestinians tolerate Islamic terrorists who carp at another sovereign state, Israel. Palestinian complicity in aggression against Israel is an obvious casus belli.
Even Israeli annexation of the Palestinian land might be easier when Israel deals with a sovereign state. World opinion today sides with the Palestinians in the territories suffering from Israel, but with a sovereign Palestinian state, world opinion might take the Israeli side in a conflict between two states, Israel one and another - failed and riddled with Islamic terrorist nests. Israel must now ask permission of the international community and the Arab powers to annex Palestinian land. With a Palestinian state, Israel could force the government to make concessions to Israel far more readily than Israel can extort them from a Palestinian civilian population the West pampers. Since many Palestinian factions, including perhaps the Palestinian Liberation Organization's mainstream, did not reject the 1974 Phased Plan calling for eventual annihilation of Israel but rather accepted a reduced Palestine from which to attack Israel, Palestinian asymmetric aggression against Israel is likely to become a reality. If Palestine blows her chance at statehood after the West’s efforts to provide it by anti-Israeli terrorism, the world community will not object if Israel swallows it to repel aggression. The West objected to Israel annexing the lands taken from Syria and Egypt after preempting their aggression in Israel's 1967 war with them, but the case is different with Palestine: insignificant state, no Soviet sponsor.
Establishing a Palestinian state would make Israeli control and annexation easier for another reason. While Israel is the Palestinians’ only enemy today, factions would grow up at once within their own state With a little support from Israel, Palestine would plunge into turmoil, and a government collaborating with Israel might sign a peace treaty that includes Israeli annexation. Quisling’s plan failed only because Germany overextended the fronts. In the absence of an Israeli enemy to cement national resolve, internal strife would push Palestinians to emigrate.
On the other hand, if Israel decides to annex the Palestinian territories immediately, then Israel must immediately annihilate Palestinian industry and infrastructure, including medicine and education, in response to Palestinian terrorist acts against Israel, forcing Arabs to emigrate. Yet that solution is not economically feasible for Israel. The cost to Israel of a drawn out Middle East conflict would offset any profit Israel might receive from the Palestinian territories. If Israel categorically rejects the creation of a Palestinian state, Palestinians hostility might cool over time, provided subsequent Israeli governments hold firm and refuse to resume the Israeli concessions game. At any rate, Israel should not appear willing to transfer the Palestinian territories unless Israel do it now and without conditions.
Administrative autonomy for the Palestinians within Israel will not work, but Israel could create a federal state of warring cantons in Israel. Yugoslavia, Ireland, and Chechnya prove that such entities are unstable; yet world opinion decries state repression of minorities, and Israeli - of Palestinians.
Israel's only alternative to a Palestinian state is to expel the Palestinians. Morality aside, that solution is more reliable for Israel, more certain, cheaper, and more effective than Israel trying to make Arabs loyal Israelis or good neighbors.
Frightening the Palestinians into submission to Israel is impossible as a long-term Israeli policy while the United Nations, the mass media, the human-rights watchdogs, and popular opinion are around to carp on Israel. Thus, Israeli repression must be swift to settle the Israeli-Palestinian problem once and for all by Israel' driving the Palestinians out and dispersing them. Any other Israeli policy will cost Israel dearly in Jewish lives, materiel, money, and public support of Israel. Any firm policy is better for Israel than none. Even if Israel decides to keep the Palestinian territories and the Palestinians on them, Israel should say so, pass laws, shoot extremists, give limited Israeli citizenship and work in Israel to the rest, and let them get along with Israel with no hope of national sovereignty, exactly as other Israeli Arabs do.
Theoretically, there is another way to make a subjugated people accept new rulers: benevolence. But walking the thin line between kindness and weakness is beyond Israeli politicians. Benevolence to previously repressed people would bring in destructive welfare and affirmative action.