How the United States Mislabels Israel

The Obama administration has made a mess of its “Made in Israel” rules.

In a move uncharacteristic of U.S. policy as it has been carried out for decades, the Obama administration recently endorsed Europe’s version of a soft Boycott, Sanctions and Divestment (BDS) campaign targeting Israeli merchandise.

In late January, the U.S. Customs and Border Protection agency changed its policy on imports from the West Bank, imposing, in effect, a sanction on such goods.

The penalty states that products must no longer be labeled “Made in Israel,” because the United States views the West Bank as territory illegitimately controlled by Israel.

Europe adopted such a labeling policy in November. Since then, the United States has chartered a zigzag course through the product demarcation debate. When asked in November if labeling constitutes a boycott, Mark C. Toner, U.S. State Department deputy spokesman, said: “It’s a—it could be—it could be perceived as a step on the way.”

Just last month, however, Toner’s boss, spokesman John Kirby, announced: “We do not view labeling the origin of products as being from the settlements a boycott of Israel. We also do not believe that labeling the origin of products is equivalent to a boycott.”

The United States, like the European Union, goes to great lengths to insist that demarcating Israeli products from the settlements is not a boycott.

Yet, in an increasingly anti-Israel Europe, labeling could lead to sweeping damage to Israel’s economy. This slippery slope helps to explain why a bipartisan group of thirty-six senators protested the EU decision. Sens. Kirsten Gillibrand (D-NY) and Ted Cruz (R-TX) took the lead in sending a letter of objection to the EU in November.

“As allies, elected representatives of the American people, and strong supporters of Israel, we urge you not to implement this labeling policy, which appears intended to discourage Europeans from purchasing these products and promote a de facto boycott of Israel. . . ,” wrote the senators.

To blunt European economic warfare targeting Israel, South Carolina Gov. Nikki Haley in 2015 approved legislation that outlaws public organizations from conducting business with companies that discriminate against the Jewish state.

Illinois and Indiana have passed similar anti-BDS legislation. In late January, Florida legislators announced they intend to pass a bill opposing companies involved in BDS.

California seeks to replicate similar pro-Israel legislation.

Congressman Brendan Boyle of Pennsylvania introduced HR 2645, legislation that seeks to prohibit the federal pension system from investing in companies that boycott Israel.

The combination of the U.S. State Department endorsing the EU labeling of settlement products along with intensified criticism of Israeli peace process policies gives a tailwind to the boycott supporters. The stated aims of BDS are nothing short of the dissolution of Israel and its replacement with a binational, majority Palestinian entity. Put simply, the BDS movement’s goal is the opposite of peace.

These diplomatic maneuvers coming out of President Obama, Secretary of State John Kerry and the State Department at large are making Israel a partisan issue in the United States.

From the beginning of Obama’s time in office his administration demanded that Israel halt settlement activity. Obama’s posture has been motivated by two assumptions: The key to solving the Middle East’s problems rests with the Israeli-Palestinian problem, and the be-all and end-all of obstacles to a final peace agreement in the region is remedying the problem of Israel’s control over the disputed territories of the West Bank, East Jerusalem and Golan Heights.

This faulty "linkage theory" contributes to a growing rift between the Israeli and Palestinian positions. Both parties are aware that the settlement issue will only be solved when the final borders of Israel and a future Palestine are created, which is why Palestinian leaders Mahmoud Abbas and the late Yasser Arafat both previously entered into negotiations without a freeze on settlement construction. For that matter, if a construction freeze was so important for restarting negotiations with Israel, the PA could have initiated direct discussions during 2010's ten-month settlement moratorium rather than waiting to start talks during the month that the freeze was due to expire.

Yet the White House’s attitude is that it can twist Israel’s arm diplomatically in exchange for security guarantees, and the slippery slope to boycotts can be used as a legitimate pressure point.

The EU mirrors the U.S. escalation pressure-point strategy by seeking to compel Israel to make unilateral concessions to the Palestinians in the context of the stalled peace process.