4.4.1-19: Israel and Palestine

Module 4, Section 4.1-19

Israel and Palestine

4.1 The heart of the conflict is the question of who has the proper claim to the land known throughout history as Canaan, Israel, Judea, Palestine, and the Holy Land. Going deeper, there is an economic and ethical question of what we mean by "the land."

4.2 The ownership of land has two basic components: 1) the right of possession, including the use of land, the products of labor on land, and right to transfer the land to others; 2) the right to the yield or return on the land as a result of nature and society created land value, which for the land alone, excluding buildings and improvements, is land rent. Rights of possession are separable from rights to the rent.

4.3 The natural-law philosopher John Locke in his Two Treatises of Government stated that "The things of nature are given in common," whereas each person has ownership of himself. He then stated that one could claim possession of land so long as there was land of equal value freely available to others.

4.4 If such land is no longer available, our common right to the natural heritage can be obtained by sharing the benefit of the land, which is economically manifested as its economic rent, the rent that should be paid to society by a tenant that puts the land to its best economic use.

4.5 With respect to the possession of Israel-Palestine, there is an ancient as well as historical basis for the possessory claims of both the Israeli Jews and the Palestinian Arabs. The reconciliation of these claims has thus far not been resolved by either the establishment of a unitary state nor by a two-state partition.

4.6 The third method of coexistence, as states within a confederation, could offer the benefits of unity without the danger of domination. As the American social philosopher and economist Henry George wrote, "warfare is the negation of association." Perhaps the reverse is true as well: association is the negation of warfare.

4.7 The challenge in formulating a proposal is, to put it in economic terms, to maximize the opportunity to fulfill individual and ethnic interests subject to the constraint of justice. A confederate association of separate but equal states would not interfere in the internal activities of the states. Each of the states, Israel and Palestine, would govern its domestic affairs as it saw fit.

4.8 The Confederation would have three main functions:

  1. Courts and enforceable laws.
  2. Defense and foreign affairs.
  3. Annual land value assessments and collection of rent which would be equitably distributed for the benefit of everyone in the Confederation.


4.9 Specific details of the proposed Confederation legislature and governance structure plus the first two points above have been described elsewhere (see Peace Through Confederal Democracy and Economic Justice by Fred Foldvary). We will herein focus on the third function as this is the land value capture proposal applied to areas of ethno-territorial conflict.

4.10 This third function of the Confederation would be to assess all the land annually and collect the land rent from the owners, including governmental titleholders. Mechanically, it would be the same as a property tax, except that it would exempt all personal property, buildings, and improvements to land, and collect (value capture) what the land would rent for in a market rental auction.

4.11 As previously stated, the right of possession of land in terms of occupation and use is separable from the right to receive the land rent. Those who wish to possess and directly use land would have the responsibility to pay rent into the common resource rent fund. All residents of the Confederation thus would have an “equal right to rent.”

4.12 Any purely geographical redivision of land sites would be practically impossible and leave each person with less than their full share. But the collection and distribution of land rent in a practical, efficient and equitable way is the best way to share the nature and society created benefits of land. In this way the claims of Jews and Palestinian Arabs (and Bedouins) to the entire territory can be met by an equitable distribution of land rent to all residents of the Confederation. Each resident would be entitled to an equal share of land rent, either as provided by government provided services or as direct citizen dividends or a combination of the two to be decided upon by discussion and vote of all residents of the Confederation.

4.13 The Confederation would retain a portion of remaining land rent for its administration, for the retirement of any debts or for other agreed-upon purposes.

4.14 The land would be viewed as jointly owned in common by both Israelis and Palestinian Arabs, and members of both groups would share the rent that would be paid by those desiring exclusive private use of particular land parcels. Those who could best utilize land would be able to pay the most land rent back to all residents of the Confederation. The dynamics of this social synergy creates a “win-win” land tenure system.

4.15 The Confederation would also establish rent collection authorities for water use and for all other natural resources, further building a fair economy based on equal rights to the gifts of nature.

4.16 The concept of commonly-shared rent in conjunction with a confederation will be referred to here as a "geo-confederacy," encompassing commonly-owned land ("geo") in conjunction with confederated states and citizenship.

4.17 For the Israelis to accept such a settlement, they need to regard it not as yielding territory, not as a withdrawal, but as an agreement to share sovereignty; not as the establishment of a hostile neighboring state, but as the preservation of Jewish autonomy within a common government over which they will have significant control.

4.18 The Palestinians too will resist a settlement unless they see it as a just plan. Obtaining their share of the rent from all the land in Israel and Palestine as compensation for not directly possessing it would go a long way towards establishing both security and economic justice.

4.19 The ultimate source of resentment and hatred is the feeling that another is enjoying a privilege, an unfair advantage, or a position of dominance. When all are politically equal, such feelings would subside and then and only then would cooperation and friendship be possible. A geo-confederation can elegantly resolve ethno-territorial conflicts.