Israeli Prime Minister Binyamin Netanyahu’s "Jewish state" or "nation state of the Jewish people" demand is popular with the Israeli public. The right wing likes it because it is patriotic and seemingly "anti-Arab". The left and center cannot easily oppose it because it dovetails with their emphasis on ending the occupation in order to maintain Israel as a Jewish and democratic state in view of the demographic threat. Netanyahu can even take credit for getting US President Barack Obama to endorse the Jewish state demand.
Whether Netanyahu is consciously aware of it or not, the origins of the explicit negotiating demand that Palestinians recognize Israel as a Jewish state can be traced to the failed peace talks of the past decade: at Camp David in 2000, Taba in 2001 and the Olmert-Abbas talks of 2008. It was only in the course of these attempts to discuss the "existential" or "core" final status issues of refugees/right of return and the Holy Basin in Jerusalem that Israelis became acutely aware of the ultimate import of Palestinian negotiating positions.
In these negotiations, Israelis confronted the Palestinian demand that Israel recognize the right of return–regardless of the number of refugees actually repatriated–and the assertion that Israel has no rights on the Temple Mount because "there never was a [Jewish] temple there." These positions appear to reflect an insistence that an Israeli-Palestinian final status agreement express, at least in the eyes of future generations of Palestinians, a fundamental Arab rejection of Jews as an indigenous Middle East people enjoying the right to self-determination in their historic homeland. Israel, the PLO seemingly insists, must acknowledge that it was "born in sin".
This negotiating experience, more than any other single factor, explains the growing demand expressed in various forms by the Netanyahu government that the PLO, and for that matter, the Arab citizens of Israel and a growing body of international detractors–all of whom refuse to recognize Jewish national rights in Israel–recognize Israel as the state of the Jewish people.
Sadly, Netanyahu seems to be using the Jewish state demand more as a way of browbeating the Palestinians than as a legitimate means of explaining to Palestinians and their backers the problematic nature of their own positions. Moreover, from a negotiating standpoint the Israeli prime minister is confused: first he presents the Jewish state demand as a precondition for agreeing to talks; then it becomes an essential element in any final-status pact; most recently, Netanyahu offered merely to extend the settlement freeze in exchange for PLO recognition of a Jewish state.
This explains the widespread suspicion that the prime minister grasped onto the Jewish state demand as a convenient deal-breaker. Rather than being presented as a legitimate counterweight to intractable Palestinian positions on the Temple Mount and the right of return, it seemingly lets him off the hook of a two-state solution because it is unacceptable to the Palestinians.
Nor is Israeli terminology consistent. We hear talk, interchangeably, of a Jewish state, the nation-state of the Jewish people, the state of the Jewish people, etc. Each of these terms has a different meaning and different ramifications for, say, the status of non-Jewish minorities in Israel. Israel’s declaration of independence, the closest thing we have to a constitution, defines the country as a "Jewish state", but only because United Nations General Assembly Resolution 181 of 1947 used that term. Yet this confusion underlines Israel’s own failure both to define its Jewish nature–historic, national, religious–and to persuade the rest of the world, and certainly the Muslim world, that the view of Judaism as nothing but a non-sovereign religion is historically erroneous and insulting and politically outmoded.
Yet the Palestinian response, too, is inconsistent. On the one hand, we are told that Palestinian acceptance of 181 and a two-state solution already embodies recognition of a Jewish state. Yasser Arafat even mentioned Israel once as a Jewish state. On the other hand, Palestinian leaders assert quite reasonably that they are under no obligation to define the ethnic-national nature of the "State of Israel" (Israel’s official name): Israel can call itself whatever it wants. Yet the Palestinian argument that Egypt and Jordan never had to accept Israel as a Jewish state in order to make peace ignores the provocative nature of unique Palestinian final status demands on core issues like refugees and the Temple Mount that Israelis cannot possibly accept.
Two weeks ago, PLO Executive Committee Secretary Yasser Abed Rabbo briefly agreed to recognize Israel as a Jewish state in return for an Israeli commitment to a Palestinian state within the 1967 borders. While this statement was immediately denied, it might be significant that a senior Palestinian official not only expressed a willingness to accept Netanyahu’s demand regarding Israel as a Jewish state, but sought to integrate it into the negotiating framework by demanding a quid pro quo that many Israelis and most of the international community can support: the 1967 lines.