THE real losers in the Gulf war may not be Iraq and Kuwait, who are fighting it, but the Palestinians who have dragged themselves into it. Iraq and Kuwait can be rebuilt. They both have rich oilfields. Kuwait, in addition, has enormous investments abroad. For Iraq, death and defeat may turn out to be the price of a new national life in peace and freedom rising from the ashes of Saddam Hussein's homicidal madhouse. The Palestinians, however, have seen their hopes dashed; their communities in the Israeli-occupied territories and in the diaspora have been devastated.
Yasser Arafat of the Palestine Liberation Organization (PLO) made common cause with Saddam Hussein and is indelibly tarred with that brush. He is finished as a major figure in Middle East affairs. The PLO, as it stands today, is discredited in much of the Arab world as well as in the West. There is still a Palestinian cause, self-determination, to fit into a general peace settlement, but who is to represent it and what outside support will it get?
The condition of the 1.7 million Palestinians in the West Bank and the Gaza Strip is worse today than it has been since Israel occupied the land in 1967. The war in the Gulf has canceled out all the gains made by the intifada, the uprising against the occupation, that began in December 1987. Palestinian sentiment swung to Saddam for his professed devotion to their cause. Arafat and his people seemed insensitive to the contradiction in applauding Iraq for seizing Kuwait while condemning Israel for holding the Palestinian territories. When war began on Jan. 16, and Iraqi Scud missiles, largely useless except for terror, were launched blindly at metropolitan Tel Aviv and Haifa, Palestinians in the territories and in Jordan were overjoyed.
Unhappily, the Israeli-Palestinian conflict is a zero sum game; what one side wins, the other loses. World sympathy, bestowed on the Palestinians for the killings on the Temple Mount in October and the increasing harshness of the occupation, suddenly swung to Israel. Israeli authorities clamped a 24-hour curfew for three weeks on the people of the territories, enforced by soldiers who could now with impunity shoot to kill. There was, after all, a state of war. The Palestinians made it easier for hard-line Israelis to be even tougher in the name of security. Conversely, they cut the ground out from under the Israeli doves and many others who see conciliation as the only real security.
Saddam Hussein's aggression, cheered as a heroic act of Arab self-assertion, has been catastrophic for the Palestinian economy. Of some 120,000 men who had worked in Israel, 30,000 lost their jobs before the end of 1990. This year, another 50,000 or more will lose their livelihood. Tourism is dead, foreign trade a trickle. Some 400,000 Palestinians who had lived and worked in Kuwait lost billions of dollars, their life savings. They and nearly 300,000 in other Gulf states had sent their families in the occupied territories $300-$400 million a year. That is over. So are the payments of different kinds, perhaps $500 million a year from Saudi Arabia and others. Development aid is cut off. More than that, Kuwait has made it clear that the Palestinians, on whom it had relied so heavily for professional services, will not return. Qatar has expelled them; and they are not likely to fully resume their place in any of the other states.
Palestinian enthusiasm for Saddam was mindless and spontaneous, albeit not unanimous, an infatuation that swept aside Arafat's 1988 policy of peace between Israel and a Palestinian state. In joining this stampede, even leading it, Arafat and the PLO declared their political bankruptcy. Radicals were already taking over the intifada, dictating violence and revenge within the Palestinian community. Saddam has furthered extremism by having several leading PLO moderates assassinated and welcoming to Baghdad notorious terrorists like Abu Nidal and Abul Abbas.
Israel's Prime Minister Yitzhak Shamir, who has vowed not to surrender an inch of the occupied territory, finds it easier to evade compromise if the Palestinians are seen as bloodthirsty fanatics. He has, for his part, imprisoned and expelled Palestinian proponents of a live and let live solution.
Never has the prospect of peace been dimmer. On the Palestinian side there is neither leadership nor a program and little chance at present of developing either. Life sinks deeper into misery. Some Israeli nationalists want it to be so bad that the Palestinians will flee eastward across the Jordan River before they are driven out. The ultra-right-wing expulsionist Moledet party has just been taken into the Shamir government. Such a forced ``transfer'' would make Jordan the Palestinian state. It would also make peace between Israel and the Arabs impossible long after the war in the Gulf is ended.