Netanyahu is becoming a latter-day Ceaucescu - The Jewish Chronicle

There is a tide in the affairs of men, which taken at the flood, leads to fortune", said Brutus to Julius Caesar. That tide is now smashing its way through the decrepit monarchies and ossified dictatorships of the Middle East. Tunisia's President ben-Ali has fled to Saudi Arabia. Hosni Mubarak, former strong-man of Egypt, is to go on trial in August, together with his two sons. Syria is cracking apart as dozens of towns rise up against the Assad regime. It's less a wind of change than a tsunami - and one that brings Israel its greatest opportunity yet to recast its relations with its neighbours and live in peace.

Yet at this time of unprecedented flux, which calls for deft and agile thinking, Israel's government is stuck in the same old routine, barely able to even say the phrase "Palestinian state". Binyamin Netanyahu, supposedly the most modern of Israeli leaders, is a 21st-century version of Nicolae Ceausescu. The former Romanian dictator waved from the balcony to the masses, trumpeting the imaginary achievements of socialism, lapping up the applause from his loyal acolytes. Netanyahu finds his amen corner in the US Congress, receiving 29 ovations, certain that, thanks to the hardline Zionist lobby, he has managed to outmanoeuvere President Obama.

Perhaps he has, for a while. But much larger forces are reshaping the Middle East, just as happened in eastern Europe in 1989. The old paradigm has shifted so far as to be irrelevant.

This will never be more evident than in September when the UN General Assembly votes for an independent Palestinian state. Ironically, the Palestinian leadership has followed the example of the Yishuv, the pre-1948 Israel state-in-waiting. The PA has quietly, steadily and with considerable success, built up its institutions to prepare for statehood, while garnering ever-more diplomatic support. The World Bank and the International Monetary Fund have both endorsed the PA's economic policies.

The PA, according to the IMF, is "now able to conduct the sound economic policies expected of a future well-functioning Palestinian state, given its solid track-record in reforms and institution building in public finance and financial areas". The Palestinian leadership wants to strengthen trade and economic links with Israel and increasing numbers of Israeli businessmen and women regularly travel to Ramallah, the de facto capital of Palestine, to discuss business ties.

Even Israel's security titans say the PM is inviting disaster

Israeli officials know that a vote to establish a Palestinian state would be a diplomatic disaster for the country. It would draw the world's attention to the unceasing appropriation of Palestinian land; the apartheid-like system of separate roads, water supplies and security arrangements for settlers that prevents the development of a viable Palestinian state. It would increase Israel's worsening diplomatic isolation and turn an issue of military occupation into an international legal conflict between two states.

Congress may cheer Netanyahu but the exasperation with his hardline government is growing in Washington DC - and among American Jewry. Much of the young generation, liberal-minded and politically aware, no longer even bothers trying to justify Israel's unwillingness to negotiate a final settlement. As Peter Beinart noted in a seminal essay in the New York Review of Books in 2008, the student senate at Brandeis University, a Jewish institution, rejected a resolution commemorating Israel's 60th anniversary. That is bad news. If young American Jews move away from Israel, so, eventually, will Congress.

Even the titans of Israel's security establishment - no bleeding-heart liberals - believe Netanyahu's obduracy is leading the country to disaster. Earlier this month, former Mossad head Meir Dagan launched a powerful attack on Netanyahu, reportedly describing the PM and Ehud Barak, the Defence Minister, as "reckless and irresponsible". Dagan strongly criticised Israel's failure to offer the Palestinians a peace initiative. He called for Israel to negotiate on the basis of the 2002 Saudi peace plan, endorsed by the Arab League, which offered normalisation of relations in exchange for a sovereign Palestinian state on the West Bank with its capital in East Jerusalem.

That plan is not perfect but is a good start for discussions. For, as the only fully sovereign democracy in the Middle East, Israel has an immense amount to offer the new Arab regimes. Revolution, as the young idealists of Tunis and Cairo are rapidly discovering, means more than a change at the top. It demands independent institutions: a free judiciary, an aggressive press and a powerful civil society. Israel has all of these. Even hardline Palestinian nationalists will quietly admit that Israel's democracy, and the rule of law, is an exemplar for the Palestinian state-in-the-making.

Netanyahu and his ministers must ride the flood-tide rushing across the Middle East. Otherwise, like the grey men who ruled Eastern Europe until 1989, they will be swept aside.