[House Hearing, 114 Congress]
[From the U.S. Government Publishing Office]
IMPACT OF THE BOYCOTT, DIVESTMENT, AND SANCTIONS MOVEMENT
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HEARING
BEFORE THE
SUBCOMMITTEE ON NATIONAL SECURITY
OF THE
COMMITTEE ON OVERSIGHT
AND GOVERNMENT REFORM
HOUSE OF REPRESENTATIVES
ONE HUNDRED FOURTEENTH CONGRESS
FIRST SESSION
__________
JULY 28, 2015
__________
Serial No. 114-41
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Printed for the use of the Committee on Oversight and Government Reform
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COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM
JASON CHAFFETZ, Utah, Chairman
JOHN L. MICA, Florida ELIJAH E. CUMMINGS, Maryland,
MICHAEL R. TURNER, Ohio Ranking Minority Member
JOHN J. DUNCAN, Jr., Tennessee CAROLYN B. MALONEY, New York
JIM JORDAN, Ohio ELEANOR HOLMES NORTON, District of
TIM WALBERG, Michigan Columbia
JUSTIN AMASH, Michigan WM. LACY CLAY, Missouri
PAUL A. GOSAR, Arizona STEPHEN F. LYNCH, Massachusetts
SCOTT DesJARLAIS, Tennessee JIM COOPER, Tennessee
TREY GOWDY, South Carolina GERALD E. CONNOLLY, Virginia
BLAKE FARENTHOLD, Texas MATT CARTWRIGHT, Pennsylvania
CYNTHIA M. LUMMIS, Wyoming TAMMY DUCKWORTH, Illinois
THOMAS MASSIE, Kentucky ROBIN L. KELLY, Illinois
MARK MEADOWS, North Carolina BRENDA L. LAWRENCE, Michigan
RON DeSANTIS, Florida TED LIEU, California
MICK MULVANEY, South Carolina BONNIE WATSON COLEMAN, New Jersey
KEN BUCK, Colorado STACEY E. PLASKETT, Virgin Islands
MARK WALKER, North Carolina MARK DeSAULNIER, California
ROD BLUM, Iowa BRENDAN F. BOYLE, Pennsylvania
JODY B. HICE, Georgia PETER WELCH, Vermont
STEVE RUSSELL, Oklahoma MICHELLE LUJAN GRISHAM, New Mexico
EARL L. ``BUDDY'' CARTER, Georgia
GLENN GROTHMAN, Wisconsin
WILL HURD, Texas
GARY J. PALMER, Alabama
Sean McLaughlin, Staff Director
David Rapallo, Minority Staff Director
Art Arthur, Staff Director, Subcommittee on National Security
Sarah Vance, Clerk
Subcommittee on National Security
RON DESANTIS, Florida, Chairman
JOHN L. MICA, Florida STEPHEN F. LYNCH, Massachusetts,
JOHN J. DUNCAN, JR., Tennessee Ranking Member
JODY B. HICE, Georgia ROBIN KELLY, Illinois
STEVE RUSSELL, Oklahoma, Vice Chair BRENDA L. LAWRENCE, Michigan
WILL HUR, Texas TED LIEU, California
C O N T E N T S
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Page
Hearing held on July 28, 2015.................................... 1
WITNESSES
Mr. Mark Dubowitz, Executive Director, Center on Sanctions and
Illicit Finance, Foundation for Defense of Democracies
Oral Statement............................................... 4
Written Statement............................................ 6
Mr. Daniel Birnbaum, Chief Executive Officer, Sodastream
International, School of Law
Oral Statement............................................... 7
Written Statement............................................ 8
Mr. Eugene Kontorovich,Professor of Law, Northwestern University,
School of Law
Oral Statement............................................... 8
Written Statement............................................ 10
Mr. Matthew Duss, President, Foundation for Middle East Peace
Oral Statement............................................... 10
Written Statement............................................ 12
APPENDIX
Letter to Ron DeSantis and Stephen F. Lynch from Anti-Defamation
League......................................................... 24
Statement submitted to the National Security from Josh Ruebner,
Policy Director, US Campaign to End the Israeli Occupation..... 28
Letter from Mr. Matthew Duss, President, Foundation for Middle
East Peace..................................................... 32
IMPACT OF THE BOYCOTT, DIVESTMENT, AND SANCTIONS MOVEMENT
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Tuesday, July 28, 2015
House of Representatives,
Subcommittee on National Security,
Committee on Oversight and Government Reform,
Washington, D.C.
The subcommittee met, pursuant to call, at 2:20 p.m., in
Room 2154, Rayburn House Office Building, Hon. Ron DeSantis
[chairman of the subcommittee] presiding.
Present: Representatives DeSantis, Hice, Russell, Hurd, and
Lynch.
Mr. DeSantis. The Subcommittee on National Security will
come to order.
Without objection, the chair is authorized to declare a
recess at any time.
The chair notes that he is responsible under the rules of
the House and the rules of the committee to maintain order and
preserve decorum in the committee room. And we will do that,
and disruption of business will not be tolerated. Thank you
very much.
The chair now recognizes himself for an opening statement.
BDS is the campaign for boycott, divestment, and sanctions
against Israel. The BDS movement seeks to target the state of
Israel for boycotts, divestments, and sanctions. The purported
goal is to leverage negative treatment of Israel to procure
peace in the region. However, it is clear that the ultimate
goal of the BDS movement is not to simply exert pressure on
Israel to alter domestic policies; they would like to isolate,
delegitimize, and irrevocably cripple the Jewish state.
BDS supporter and professor at Cal State University As'ad
AbuKhalil has said, ``The real aim of BDS is to bring down the
state of Israel. That should be stated as an unambiguous goal.
There should not be any equivocation on the subject. Justice
and freedom for the Palestinians are incompatible with the
existence of the state of Israel.''
Another supporter of BDS, writer John Spritzler, stated,
``BDS' stated goals logically imply the end of Israel as a
Jewish state.''
The notion that BDS is simply a harmless political movement
is not true. BDS is better understood as an attempt to single
out the world's only Jewish state for negative treatment
through economic warfare.
U.S. policy should actively oppose attempts to boycott,
divest, and sanction Israel. As our most dependable ally in the
Middle East, the region's only democracy, and a country that
shares our values, Israel deserves our steadfast support. We
need to nip BDS in the bud.
This hearing is timely in light of recent comments by the
State Department spokesman regarding anti-BDS language
contained in the trade authority bill recently passed by
Congress. While the bill specifically mandates that U.S.
Negotiators pressure potential trading partners to reject BDS,
the State Department indicated it would not enforce the
language.
Congress included the anti-BDS provision because it wanted
to stymie efforts emanating particularly from European
countries, where anti-Semitism unfortunately is at a post-World
War II high, to target Israel. Congress needs to conduct
oversight of the State Department to ensure compliance with the
statutory law.
Now, BDS is not a mainstream position in the United States,
but it has gained traction on college campuses and in European
capitals.
The goals of BDS go beyond the idea of encouraging
corporations and academic institutions to boycott and divest
from businesses in Judea and Samaria. Support for BDS is
curious in light of the fact that many advocates for BDS have
no qualms with trading with rogue regimes, such as Iran.
Indeed, these advocates seek to apply a completely separate
standard to the world's only Jewish state, while turning a
blind eye to militant Islamic regimes that threaten both Israel
and the United States.
According to a recent study by the Israeli Finance
Ministry, boycotts present a significant threat to Israel's
economy. Boycotts threaten inflation, layoffs, and a potential
20-percent drop in exports. If European companies and
governments were to support BDS, Israeli officials maintain
such action would constitute a dramatic blow to the Israeli
economy.
Israeli and American businesses have been impacted by BDS
through divestment by major church groups in the United States,
such as the Presbyterian Church (U.S.A.) and the United Church
of Christ.
The bottom line is that support for BDS undermines Israel's
economy and national security. It is a direct threat to the
continued vitality and success of the state of Israel.
Today, we will hear from the CEO of SodaStream, Daniel
Birnbaum, an Israeli company that has been the target of BDS.
The BDS campaign has specifically targeted this company, which
has since moved its factory out of Judea and Samaria, resulting
in the loss of thousands--the loss of jobs for many of the
Palestinians and Israelis alike.
In the case of SodaStream's factory in Judea and Samaria,
which is now closed, an estimated 500 Palestinian Arabs were
employed there, out of a total of 1,300 employees. While
SodaStream is working to secure work permits from the Israeli
Government for these Palestinians and other former employees at
their new factory, the future employment opportunities for many
of these workers remain uncertain. These are the very people
who BDS claims it intends to help.
We will also hear from Professor Eugene Kontorovich. He was
a major force behind the South Carolina law prohibiting
companies who want to contract with the State government from
participating in boycotts based on nationality, national
origin, ethnicity, race, and other categories of
discrimination. He will also discuss existing Federal law,
international law, and the potential impact of BDS on the
international trading system.
Mr. Mark Dubowitz, the executive director of Foundation for
Defense of Democracies, will also be joining us. He has written
extensively on the topic of the BDS movement.
Mr. Matthew Duss is the guest of my minority colleagues,
and he is the president of the Foundation for Middle East
Peace.
The bottom line is that, one, this hearing will be critical
in informing Congress about the true nature of the goals and
underlying motivations of the BDS movement and its impact on
trade and economic growth. American policy must be designed to
counteract BDS at every turn.
And, with that, I now recognize the gentleman from
Massachusetts, Mr. Lynch, the ranking member, for his opening
statement.
Mr. Lynch. Thank you, Mr. Chairman. I would like to thank
you for you holding this hearing to examine the boycott,
divestment, and sanctions movement, also known as BDS.
And I would also like to welcome today's witnesses for
helping the committee with its work.
It is the foreign policy of the United States Government to
oppose boycotts against the state of Israel. Israel is our
strongest regional ally, and the economic isolation of Israeli
goods and services will only frustrate our efforts aimed at
achieving a lasting peace in the Middle East.
The United States has consistently opposed the boycott of
Israel declared by the Arab League in 1948. Most recently,
Congress passed and President Obama signed an omnibus
appropriations bill in December of 2014 that included language
opposing the Arab League boycott as an impediment to peace in
the region and called for its immediate termination.
As with the Arab League boycott, the United States
Government opposes the boycott, divestment, and sanctions
movement that commenced in 2005 under the organization of
Palestinian civil society groups. As recently stated by State
Department spokesman John Kirby, the United States has,
``strongly opposed boycotts, divestments, campaigns, and
sanctions targeting the state of Israel and will continue to do
so.''
Some Members of Congress have questioned the
administration's willingness to enforce an anti-boycott
provision included in the fast-track trade bill passed last
month. The provision seeks to discourage foreign partners from
implementing economic sanctions against the state of Israel and
also makes reference to, ``Israeli-controlled territories.''
In response to this language, the State Department has
reiterated strong U.S. opposition to boycotts against Israel,
while also reaffirming similarly longstanding U.S. Policy on
Israeli settlement activity. As noted by the State Department,
``Every U.S. administration since 1967, Republican and
Democrat, has opposed Israeli settlement activity beyond the
1967 lines. This administration is no different, and our policy
remains firm and unchanged.'' This policy is in complete
harmony with the desire for a two-state solution.
Contrary to the criticism that has been voiced by some of
our colleagues, I believe that the administration has been very
clear in consistently applying the longstanding policy of the
United States to oppose boycotts against the state of Israel.
I would also note that the bipartisan sponsors of the anti-
boycott language included in the trade bill, Senator Cardin and
Senator Portman, have been equally clear in stating that they
never intended their amendment to legislate on settlements or
contravene U.S. policy on the settlements. Rather, the language
seeks to further discourage boycotts against Israel in
accordance with longstanding policy.
I am aware that the BDS movement has become effective in
some degree; it has had some impact. The bipartisan
Congressional Research Service notes that divestment from
Israel and boycotts of Israeli products and services have
occurred to a certain extent. Mr. Birnbaum will testify, I am
sure, on the economic impact of boycotts against his company,
SodaStream, an Israeli manufacturer that had a manufacturing
facility in the West Bank.
In December of 2013, the National Council of the American
Studies Association, a nationwide academic organization, voted
to boycott Israeli academic institutions. In recognition of the
value of academic freedom and cooperation to foster peace in
the Middle East, 134 Members of Congress, including myself,
Members from both parties, sent a letter to the association in
strong opposition to their decision.
Mr. Chairman, I look forward to discussing these and other
issues relating to the BDS movement. And I yield back the
balance of my time.
Mr. DeSantis. I thank the ranking member.
I will hold the record open for 5 legislative days for any
members who would like to submit a written statement.
Mr. DeSantis. We will now proceed to the witness testimony.
Welcome to the witnesses.
Pursuant to committee rules, all witnesses will be sworn in
before they testify, so if you could please rise and raise your
right hands.
Do you solemnly swear that the testimony you are about to
give will be the truth, the whole truth, and nothing but the
truth, so help you God?
Thank you. Please be seated.
All witnesses answered in the affirmative.
In order to allow time for discussion, please limit your
testimony to 5 minutes. Your entire written statement will be
made part of the record.
Mr. Dubowitz, you are recognized for 5 minutes.
WITNESS STATEMENTS
STATEMENT OF MARK DUBOWITZ
Mr. Dubowitz. Chairman DeSantis, Ranking Member Lynch,
members of the subcommittee, on behalf of FDD and its Center on
Sanctions and Illicit Finance, thank you very much for inviting
me to testify today.
I want to step back and take a broader look at this. The
BDS movement is a tool of political, economic, and financial
warfare against Israel. Those waging this war seek to, first,
isolate and delegitimize Israel and to turn it into an
international pariah. From there, by threatening reputational
consequences against Israeli business partners, imposing
economic damages on Israel becomes an easier task.
Our research has determined that the economic and financial
warfare campaign currently targeting Israel's relationship with
Europe is the real goal. That relationship in trade terms is
valued at about $30 billion.
My written testimony details the international
organizations, religious institutions, private businesses,
sovereign wealth funds, and universities that have joined in
support of BDS in recent years. Most of them are European. They
should all be identified publicly as having joined the economic
and financial war against Israel.
Notably, several were pressured by BDS activists and the
Palestinian Authority to terminate their business ties with
Israel. They have targeted major Israeli financial institutions
providing services to the West Bank and East Jerusalem through
local branches. They have targeted international companies
building the light-rail train system in Jerusalem. They have
targeted Israeli academics and international entertainers with
no connection to the West Bank or East Jerusalem. This is not
just about the West Bank or East Jerusalem. It is about Israel.
For those well acquainted with economic and financial
warfare, this is a familiar playbook, as pressure is ratcheted
up on the target country to inflict increasing pain.
What is even more striking is that these entities have gone
out of their way to single out Israel, the only democracy in
the Middle East, for alleged injustices, while ignoring China,
Russia, Iran, Syria, Sudan for their massive violations of
human rights. This smacks of discrimination.
It is also a bad omen for the United States and our other
allies, against whom many people around the world have
grievances. Mr. Chairman, America and its allies must prepare
for an increasingly dangerous era of political, economic, and
financial warfare targeting the United States and our allies.
This type of warfare is America's default instrument of
coercive statecraft. It is also the new normal in the
international arena. As always, Israel is the canary in the
coal mine.
Many of our allies are involved in territorial disputes
around the world. We may agree or disagree with their
positions, but our ability and will to defend them from
military, missile, cyber, WMD, and terrorist threats, amongst
others, must never be dependent on our policies with respect to
these territorial disputes. The same should be said about
defending them against economic and financial threats.
Make no mistake: After watching the U.S. Treasury
Department target Iran, Russia, and Syria with sophisticated
sanctions and other advanced economic strategies, America's
adversaries have been developing their own economic weapons.
Having witnessed the powerful impact of having Iran removed
from the SWIFT banking system, last year pro-Palestinian
organizations petitioned SWIFT to disconnect Israeli financial
institutions. SWIFT explained that it would not take action
without direction from EU regulators, who for now have refused
this request. This could change.
Meanwhile, China has used economic and other coercive
measures to challenge Japan, the Philippines, and our other
Asian allies over the South China Sea and frequently has used
economic and diplomatic pressure to challenge international
recognition of Taiwan.
Russia has used political and energy warfare to threaten
Eastern and Central European allies in order to try and
reestablish what it considers its sphere of influence. Both
China and Russia have used cyber warfare against the United
States and our allies.
For now, America and its allies are vulnerable but
buttressed by the fact that the U.S. dominates the global
economy because of the power of the U.S. Dollar. This will not
last forever. China, Russia, and others are already looking at
creating a parallel financial system free from American
influence.
Make no mistake: An economic war is undeniably underway,
and that war is now expanding to America's allies too. As the
BDS movement has made clear, Israel is among them.
Mr. Chairman, my written testimony outlines the important
legislative efforts underway at the State and Federal level to
protect Israel and our other allies from this economic and
financial war. Congress must encourage this, but more can be
done.
The United States needs to create an economic defensive
shield to protect us and our allies against economic and
financial coercion. Congress is well placed to lead that
effort.
In my written testimony, I outline a number of
recommendations, including: establishing a policy planning
function at the U.S. Treasury Department; standing up an
economic warfare directorate at the NSC; developing a doctrine
on the use of economic warfare; and establishing an economic
warfare command.
We have entered a new era, and new structures are needed to
defend the U.S. and its allies from this type of warfare. I
recommend that this subcommittee work with other relevant
congressional committees and the administration to institute
these government reforms.
In conclusion, BDS is a form of economic and financial
coercion that should be viewed within a broader problem set. To
counter it properly, this challenge must be addressed at a more
strategic level. Failure to do so will leave the United States
and our allies vulnerable to attack from economic and financial
warfare.
Thank you for inviting me to testify. I look forward to
your questions.
[Prepared statement of Mr. Dubowitz follows:]
[For complete submitted testimony, please see the following
website: http://oversight.house.gov/hearing/impact-of-the-
boycott-divestment-and-sanctions-movement/]
Mr. DeSantis. Thank you.
The chair now recognizes Mr. Birnbaum for 5 minutes.
STATEMENT OF DANIEL BIRNBAUM
Mr. Birnbaum. Chairman DeSantis, Ranking Member Lynch,
members of the subcommittee, good afternoon, and thank you for
the opportunity to testify on the BDS today.
For the past 8 years, I have been the CEO of SodaStream
International, a company publicly traded on the NASDAQ and
headquartered in Israel. SodaStream is the world's leading
manufacturer and distributor of home carbonation systems. Our
products are available in 45 countries around the world and
sold at 70,000 stores, including 13,500 here in the United
States. The products are manufactured at 12 facilities around
the world, including 1 in New Jersey. However, our largest
facility is in the Mishor Adumim industrial zone of the West
Bank.
I am speaking to you today because SodaStream has been a
primary target of the BDS and its affiliates since my early
days with the company 8 years ago. Here is the story in a
nutshell.
In all the craziness of the Middle East, in the midst of
all the distrust, separation, hate, and violence, there is one
factory that proves that things can be different, one factory
that is an island of peace, where Palestinians and Israeli Jews
work side-by-side--equal wages, equal benefits, and equal
opportunity. In total, this factory employs 1,300 people, of
whom 400 are Israeli Jews, 400 are Israeli Arabs, and 500 are
Palestinians from the West Bank. We eat together in the same
dining hall, and we celebrate each other's festivals.
The wages we pay in this factory are according to Israeli
law--wages which are three to four times higher than what our
Palestinian workers could earn if they had a job in the PA. We
provide a healthcare package for all our workers and their
families that includes physician home visits, prescription
drugs, overseas treatments, and even organ transplants--all
that at zero copay.
More broadly speaking, this factory, which may be the
largest private employer in the West Bank, could also very well
be the seeds of the budding economy of the future Palestinian
state.
This factory is, or should I say was, a true gem in many
ways, but the BDS thought otherwise. They have been attacking
this factory in various campaigns and schemes all over the
world, calling for its closure and effectively calling for the
termination of its 1,300 employees.
The BDS have thrown all possible war crimes at us, accusing
us of ethnic cleansing, stealing land, perpetuating the so-
called occupation and profiting from it, exploiting our
Palestinian workers, acting against international law,
representing apartheid. Such a long and horrible list of
infractions make it almost futile to defend.
BDS tactics include intimidating, harassing, and
threatening of our retail partners around the world. BDS
activities have been vandalizing our products in stores,
stickering them with hate images, throwing product on the
floor, stickering, picketing, chaining themselves to the
entrances to the stores, conducting violent demonstrations and
flash mob events, circulating pamphlets and utilizing social
media to spread vile videos on YouTube, mobilizing mainstream
media--all to manipulate our retailers to drop our product.
To provide the appearance of ``moral grounding and
substantiation of international law,'' the BDS garnered support
from churches, including churches here in the United States,
from well-known NGOs, and support from European governments.
The BDS are in the business of manipulation, violence, and
destruction, but, instead of using bullets and bombs, they use
vicious lies and half-truths.
I would like to share with you just one example of a
grotesque image broadly distributed in Europe and which is also
featured at this very moment on a BDS Web site. On page 13 of
my written submission, you will see this image that shows
SodaStream product smeared with blood, and it reads in French,
``SodaStream: A product that kills. One product bought equals
one family massacred.''
Are these not libelous statements that cross a line? A
French court ruled in January 2014 that this conduct,
specifically this image, is abusive and illegal, and the BDS
was issued a cease-and-desist order and a punitive fine.
Last October, we took a business decision to relocate this
facility to a much larger facility inside the 1967
international borders of Israel--a business decision. And how
did the BDS respond? Well, as expected, they celebrated a big
victory. They did not care that 5,000 Palestinians will lose
their sustenance.
But what is really revealing is that the attacks are
continuing even after we announced our departure from the West
Bank. This shows the true agenda of the BDS.
To our amazement, we are now being accused of stealing land
for our new factory from the adjacent Bedouin town of Rahat
within Israel. This is simply preposterous. The reality is that
we were invited here. In my written statement, you will see a
letter by the mayor of Rahat, Talal El-Garnawi, stating that
these claims are not only false but that are our factory is a
blessing, bringing economic prosperity to his town.
Finally, the story of the 8-year hate campaign against
SodaStream really exposes the true face of the BDS. It is
evident that the BDS and its affiliates use the Palestinian
people as a proxy to advance their political agenda grounded in
the hate of Israel. Indeed, the BDS leaders have said many
times that their true agenda is not to liberate the West Bank
but, rather, to end the existence of the Jewish state of
Israel. We shall not let that happen.
Chairman DeSantis, Ranking Member Lynch, subcommittee
members, this concludes my prepared statement. I will be happy
to answer any questions you may have.
[Prepared statement of Mr. Birnbaum follows:]
[For complete submitted testimony, please see the following
website: http://oversight.house.gov/hearing/impact-of-the-
boycott-divestment-and-sanctions-movement/]
Mr. DeSantis. I thank the gentleman.
The chair now recognizes Mr. Kontorovich for 5 minutes.
STATEMENT OF EUGENE KONTOROVICH
Mr. Kontorovich. Chairman DeSantis, Ranking Member Lynch,
honorable members of the committee, thank you for inviting me
to testify today about the continued campaign of economic
warfare against Israel.
The campaign of economic warfare against Israel dates back
to the birth of the Jewish state. Starting in 1948, the Arab
League organized a notorious campaign to isolate Israel. Not
only did they block any economic ties between themselves and
Israel, they pressured companies in third countries to also
boycott Israel.
In the 1970s, at the height of the Arab League's boycott
campaign, the U.S. passed laws making it a crime for U.S.
entities to participate in the boycott. Since then, the Arab
League boycott has fallen into decline and under-enforcement.
Part of this has been due to these U.S. laws and U.S. pressure
in trade negotiations. Partly, it has been due to changing Arab
attitudes towards Israel.
As Arab states were increasing their trade with Israel, the
old boycott campaign developed a new face. At the Durban Forum
in 2001, anti-Israel groups, coordinated by U.N. Agencies,
adopted boycotts and sanctions as a policy tool to isolate
Israel. Thus, private actors appear today at the forefront of
boycott campaigns today, but the strategy is the same as the
Arab League pursued: to choke off and delegitimize Israel.
Several legislative initiatives in Congress seek to update
U.S. Laws to deal with the new face of the boycott movement.
Part of this legislation has passed in the TPA, and another
important part, contained in H.R. 1907, is currently in
conference. These laws are merely mild updatings of the
traditional U.S. Approach to Israel boycotts. They have
received across-the-board, unanimous support in Congress.
Nonetheless, some object to the anti-boycott laws because
they would also apply to boycotts that also are directed at
entities in, ``territories under Israel jurisdiction,'' which
means West Jerusalem, the Golan Heights, and other parts of the
West Bank. Contrary to the entirely unsupported claims of these
critics, this is also entirely consistent with U.S. Law and
policy.
The existing anti-boycott laws also apply to boycotts of
any Israeli nationals or companies, regardless of their
location. No one has ever objected to this or sought to limit
the application. In signing the 1977 anti-Arab-League-boycott
law, President Carter observed that the issue goes to the very
heart of free trade amongst nations and that boycotts were, in
fact, divisive measures aimed particularly at Jews. President
Carter and no one else has ever suggested that the anti-boycott
laws be limited to Israeli companies in any particular
location.
Moreover, the U.S.-Israel Free Trade Agreement, passed in
1985 and expanded in 1996, expressly allows Israeli products
from the West Bank to receive the same status for U.S. trade
purposes as any other Israeli products. As reflected in the
U.S.-Israel Free Trade Agreement Implementation Act, this was
immediately put into effect by President Clinton.
Indeed, there is no basis in U.S. law for disallowing
Congress to apply particular laws, trade laws, or other lawful
measures to the West Bank or any other territories. Nor does
this contradict U.S. foreign policy. While the Executive has
indeed at times opposed settlement expansion or settlement
construction--that is to say, adding homes for Jews in the
disputed territory--no administration has ever opposed business
activity there. Indeed, the U.S. Has long recognized that peace
depends on increased prosperity and economic integration.
Moreover, boycotts do not seek to prevent settlement
growth. Rather, their express goal is to choke off and
eliminate all Jewish presence, even mere business activity, in
the disputed areas, including ones that would surely come under
Israeli sovereignty in any peace deal. This fundamentally
contradicts U.S. policy, dating back to 1967, that any ultimate
parameters must be negotiated.
Finally, this language, this now-controversial language, is
necessary to prevent anti-boycott laws from becoming
indeterminate and incoherent. For example, language referring
to territories controlled by Israel is necessary simply to have
such laws applies to western Jerusalem. As is well known, the
position of the administration and several administrations is
that western Jerusalem is not part of the state of Israel.
Thus, if Congress wishes to ensure that its trade measures and
laws concerning Israel apply to western Jerusalem, language
like ``territories under Israeli jurisdiction'' is needed. And
that is based on the administration's own view in the
Zivotofsky case.
Moreover, boycotts of settlements are not self-limiting,
because settlements are not businesses. Business is one thing;
settlements are another. What about the Tel Aviv tour operator
that goes to the Old City, organizes a tour? That could fall
within the boycott movement in European sanctions. On the other
hand, we know that even the President of the United States has
visited the Old City. This is not what people mean by
``settlements.''
There is nothing internationally illegal about doing
business in the territories. One does not need to be a
supporter of settlements to understand this. Just last year, a
prestigious French appeals court ruled that French and
international law allows French companies and businesses to do
business with the Israeli Government in these areas.
Finally, as I elaborate in my written testimony, the
planned EU trade restrictions, which some of these measures go
to, would violate multiple provisions of the General Agreement
on Trade and Tariffs.
Let me conclude with some brief recommendations. Congress
should quickly pass H.R. 1907 to make clear that these measures
are violations of the GATT, to encourage States to continue to
pass laws dealing with boycotts, and to protect United States
companies from discriminatory and baseless foreign judgments
based on perversions of international law.
[Prepared statement of Mr. Kontorovich follows:]
[For complete submitted testimony, please see the following
website: http://oversight.house.gov/hearing/impact-of-the-
boycott-divestment-and-sanctions-movement/]
Mr. DeSantis. I thank the gentleman.
The chair now recognizes Mr. Duss for 5 minutes.
STATEMENT OF MATTHEW DUSS
Mr. Duss. Chairman DeSantis, Ranking Member Lynch, members
of the subcommittee, thank you very much for inviting me here
to speak to you on this timely issue.
In the 10 years since it commenced, the BDS movement has
slowly but steadily risen in visibility. I would like to focus
today on the role that this movement has been playing recently
in the United States, particularly with regard to recent
congressional legislation.
In order to do that, I want to first take a moment to
identify just what we are talking about when we discuss BDS.
This movement has three main demands. The first is an end
to the occupation that began in 1967. The second is equal
rights for Palestinian citizens within Israel. The third is
protecting and promoting the rights of Palestinian refugees to
return to their homes in what is today Israel.
This movement is distinct from many peace activists in
Israel, Palestine, the United States, Europe, and elsewhere who
support boycotts of settlement products and divestment of
businesses profiting from the 48-year-old occupation of the
West Bank, Gaza, and East Jerusalem as part of an effort to
preserve the possibility of a two-state solution to the
Israeli-Palestinian conflict.
Crucially, the BDS movement is also distinct from the
recent moves by the European Union to more aggressively
distinguish between Israel within the pre-1967 lines, known as
the Green Line, and the occupied territories.
This is where we come to the recent trade legislation by
Congress and the response from the State Department. With the
stated intention of protecting Israel from BDS, the recently
passed Trade Promotion Authority contained a provision that
implied a significant shift in the policy of the United States
since 1967. The provision requires the U.S. Trade
Representative to discourage European Union countries from
boycotting, ``Israel or persons doing business in Israel or
Israeli-controlled territories.''
This is why I think it was important and appropriate for
the State Department to offer a clarification, as it did upon
passage of the trade bill, stating that the U.S. will continue
to make the distinction between Israel and the occupied
territories, as the United States has done since 1967.
Now, I can talk more about this in the Q&A, and my written
statement contains more detailed analysis, but, to the extent
that one sees BDS actions as part of an effort to delegitimize
Israel--and I think that's clearly the case with regard to a
number of the leaders of the movement--they should certainly be
addressed but, I would advise, not through legislation. Israel
has protections it needs and deserves under existing U.S. Law.
The arguments raised by the BDS movement in academic and other
civil society institutions should be addressed in the American
tradition, with thoughtful, considered, and ethical counter-
arguments.
I would also take a moment here to suggest that it is a
mistake to focus on the BDS movement while ignoring the main
reason for its continued growth, which is the failure to end
the occupation that began in 1967 and achieve Palestinian
freedom and sovereignty. If one is genuinely concerned about
the impact of the BDS movement, the surest way to take the wind
out of its sails and arrest its growth would be to work to
achieve those goals and act against efforts which prevent or
foreclose them.
Moreover, it would be counterproductive to give BDS an
unearned victory here by cooperating in any way with the
conflation of Israel and the occupied Palestinian territories.
We can and must support Israel in defending herself against
actions that genuinely threaten her security and legitimacy.
This has been a consistent American position since Israel's
birth.
Another consistent American position, however, has been in
opposing the creation of Israeli settlements, which have been
deemed illegitimate and an obstacle to peace by every U.S.
President since 1967. Efforts to blur that distinction are just
as dangerous to Israel's existence as a Jewish and democratic
state as attacks on Israel's legitimacy itself. It is entirely
consistent with longstanding U.S. policy, and, indeed,
necessary to preserve the ultimate goal of a two-state
solution, to continue to make that distinction in U.S. Policy
and law.
I thank you, gentlemen, for your time and attention and
look forward to your questions.
[Prepared statement of Mr. Duss follows:]
[for complete submitted testimony, please see the following
website: http://oversight.house.gov/hearing/impact-of-the-
boycott-divestment-and-sanctions-movement/]
Mr. DeSantis. Thank you.
The chair now recognizes himself for 5 minutes of
questioning.
Mr. Dubowitz, a lot of Americans may not know what BDS is.
Is there any doubt in your mind that BDS is more than just
trying to boycott certain policies, that BDS is aimed really at
the legitimacy of Israel itself?
Mr. Dubowitz. Chairman, there is no doubt in my mind. I
mean, this is a familiar playbook for people who have worked in
the area of sanctions. I've spent over a decade working on
sanctions, and it is a very familiar playbook. As I said, it is
about delegitimization at the political level. it is about
establishing the country as an international pariah. And then
it is about using a combination of state actions and private
actions in an economic and financial warfare campaign against
that country.
And I would make another point, and that is that many of
our allies, actually, are involved in territorial disputes
around the world. I mean, in the South China Sea right now,
there are huge disputes going on between China and Vietnam and
the Philippines and Japan and other countries. The United
States shouldn't be taking a position on territorial disputes
in the context of economic and financial warfare. We don't, for
example, when supporting our allies against cyber threats,
conventional military threats, terrorist threats, or missile
threats.
We have a firm policy of defending our allies, when we
actually fund and sell missile defense systems or cyber defense
systems to Israel, we expect the Israeli Government to use
those systems protecting everybody in the region, including in
the West Bank and West Jerusalem and East Jerusalem. There
should be no distinction with respect to economic and financial
warfare.
Mr. DeSantis. Now, Mr. Birnbaum, you know, you have this
company. You are employing all these Palestinian Arabs. You get
targeted by BDS, so then you move operations. But yet they
still target you. And so I think that that, to me, is very
revealing. And I really appreciate your testimony, because I
think that really educates the American people about what is
really at the heart of this movement.
But is there any doubt in your mind that this BDS movement
is targeted beyond just territorial issues but about the
legitimacy of Israel itself?
Mr. Birnbaum. Mr. Chairman, there is no doubt in my mind at
all. And if I had any doubt, it was quenched the moment we
announced that we were moving away from our West Bank factory
on October 29, 2014, and a day later there were celebrations
and new attacks on SodaStream for supposedly occupying the land
of Bedouins within the state of Israel. And you can see those
attacks at this very moment on certain BDS Web sites.
And, for me, that is evidence that the BDS is not after
freeing the supposed occupied West Bank, but the BDS is after
the destruction of the state of Israel. They are not going to
leave us alone. But we are going to continue doing what we are
doing, because we are doing the right thing for our employees
and for consumers around the world. They will not stop us.
Mr. DeSantis. So, because of the movement in response to
BDS, how many fewer Palestinian Arabs are now employed?
Mr. Birnbaum. That's a situation that we are discussing
right now with the Israeli Government.
At this moment, there are about 400 Palestinians still on
our payroll in both of the factories. One is in the process of
being closed, the one in the West Bank. We expect that will
close around October of this year. And another couple of
hundred are already working in the new facility under temporary
work permits. If the Israeli Government is gracious enough to
grant us work permits for these Palestinians, we can continue
to employ them.
And, by the way, each one of them sustain 10 people, 10
dependents, on average. So right now we are impacting about
4,000 Palestinian people.
I am hoping the Israeli Government will come through, but
it is been a struggle and a debate that we've had with them for
over 10 months now.
Mr. DeSantis. So it is possible that there would be less
jobs for Palestinian Arabs as a result of the----
Mr. Birnbaum. Absolutely. As it stands right now, Mr.
Chairman, the work permits we have for the Israeli employees--I
am sorry--for the Palestinian employees that are working in
Israel right now are to expire at the end of this month, in
just a few days.
Mr. DeSantis. Professor Kontorovich, I think that you and
Mr. Duss have a disagreement about longstanding U.S. policy,
particularly this TPA provision. As he characterized it, this
was a significant change. The State Department was right to,
kind of, make the statements that they did. Your position, I
think, is that this has been pretty consistent, that we have
not discriminated about particular commerce.
So would you care to respond to Mr. Duss?
Mr. Kontorovich. Thank you.
So the United States position is articulated in laws and
policies that the United States has adopted. I did not hear Mr.
Duss cite laws to the contrary. On the other hand, the existing
anti-boycott legislation applies to companies organized under
Israeli law, regardless of where they would operate.
Similarly, the U.S.-Israeli Free Trade Agreement
Implementation Act gives the President the authority, which
every President since Bill Clinton has exercised, to give
Israeli treatment to products from areas under Israeli
jurisdiction. Thus, every existing U.S. law on the subject has
extended Israeli national treatment to these areas.
Mr. DeSantis. Now, Mr. Duss, I mean, regardless of, kind
of, your views of the situation, I mean, Congress passed a
specific provision in the trade authority bill. I mean, is not
the appropriate response for if the State Department does not
want that to come to Congress and ask them to change it, to
just try to say you are not going to instruct your trade
negotiators when they are negotiating deals, particularly with
the European countries where this is a bigger issue, to simply
not abide by it?
Mr. Duss. Thank you for the question.
I think the principle was that the State Department was
insisting on continuing consistency in U.S. policy, which is
one of distinction between Israel, the state of Israel, and the
occupied territories----
Mr. DeSantis. But it might not be consistent with what was
actually passed by the Congress. And I think that what the
Congress, I think, intended is similar to what Professor
Kontorovich laid out, was that boycotting Israel, we want to
target that, we want our trade negotiators to negotiate
specifically with the European countries, that, you know what,
you are not going to boycott Israel. And the fact that there
may be a company located somewhere else, that is not been a
distinction that the Congress has wanted to draw.
Let me ask all of you, but, Mr. Dubowitz, the growth of BDS
in colleges and in Europe, can you give us a sense of--I think
I was in law school when I first heard about it. It was, like,
a really fringe thing. I mean, I know it is not mainstream in
American society, but it seems to have picked up steam on
college campuses and in European capitals.
Mr. Dubowitz. I think that's exactly right. And, obviously,
the goal is--the college campaign is a goal of political
delegitimization. it is to turn Israel into an international
pariah. Then it makes it much easier for the BDS movement and
their supporters to specifically launch an economic and
financial warfare campaign against Israeli companies with a
fundamental choice, you either do business with Israel or you
do business with Europe but you can't choose between--you can't
have both.
And so it is very much--the BDS movement at an activist
level is about political delegitimization. They also, then,
have now turned their sights not only on Israeli companies but
international companies that are actually working in Israel.
And the fundamental goal is to undermine the Israeli economy,
inflict severe economic damage on Israel, and try to change
their policies.
Again, from a U.S. national security point of view, there
are many people in the world that have grievances against the
United States. They will turn to economic and financial warfare
against us and against all our allies. And I think it is
incumbent upon the U.S. Congress to help create an economic
defensive shield to protect all of our allies against the use
of this new weapon.
Mr. DeSantis. Professor, do you agree that BDS has picked
up steam on American college campuses over the last decade?
Mr. Kontorovich. It does seem to be attracting more press
attention. But one needs to also differentiate between college
activity and the activity in the European Union, which is
actually probably the most threatening. In college, there is
often lots of tumult that does not amount to much.
Mr. DeSantis. There has been an increase of attention in
the European capitals, correct?
Mr. Kontorovich. Yes.
I would like to offer one clarification about the State
Department statement about the TPA.
Mr. DeSantis. Sure.
Mr. Kontorovich. At least in the public statement--and I
think it is important to note this and hold them to this--the
State Department did not say that they would not enforce the
provisions of the TPA. They did say they didn't like them, but
they did not come out and say they would not enforce them.
There has been no Presidential signing statement. So the
natural assumption, absent such a statement, would be that they
would continue to enforce and apply it despite not liking it.
Mr. DeSantis. Spend some time here; that might not be a
good assumption. But I take your point.
All right, my time is up. I will now recognize the ranking
member, Mr. Lynch, for 5 minutes.
Mr. Lynch. Thank you, Mr. Chairman.
I do want to revisit the idea about congressional intent,
though, and I think you raise an important point. But in
determining what congressional intent is in a bill, I think it
is entirely appropriate to ask those legislators what they
intended. And we did ask. We did ask Senator Cardin and we did
ask Senator Portman what they intended by their amendment. And
they intended that there be no change in the State Department
policy.
So that is probably why you don't have a clarification on
what State Department policy is, because they intended no
change, and the administration saw no change. And the amendment
passed unanimously, with no controversy whatsoever. And it was
a consistent continuation of U.S. policy.
I think one thing we can agree on is the importance of
reaching a sustainable, peaceful solution between the Israelis
and Palestinians. The two-state solution offers a vision of two
secure, coexisting democratic nations. It has been a
longstanding foreign policy objective of the United States and
is supported by the vast majority of Congress.
Mr. Duss, how long has the United States supported the two-
state solution as a matter of official policy?
Mr. Duss. As a matter of official policy, I believe it was
President George W. Bush who first articulated specifically and
explicitly that the two-state solution was the policy of the
United States.
Mr. Lynch. Now, I am not as--I know the outward
manifestations of the BDS movement, but does the BDS movement
generally support or oppose the two-state solution?
Mr. Duss. The BDS movement does not make claims about
outcomes. It claims to be a rights-based movement. I think,
looking at the statements of a number of BDS leaders, it is
clear that quite a few of them do not support the existence of
Israel. They support other solutions.
This is why I think it was very important, and it is very
important, as I said in my opening statement, to distinguish
between those who support economic action against Israel as a
whole, such as the BDS movement, and those who support targeted
action against the settlements, such as people in Israel,
people in the United States, people in Europe, including the
EU.
This is exactly what the EU measures being discussed now
focus on. This is not boycott. This is the EU just enforcing
its own laws, focusing on its own economic activities with
Israel. This is the EU saying to Israel, we want to do business
with you, we want you to continue to be a favored trading
partner; however, our own laws prevent us from engaging with
these entities across the Green Line.
Mr. Lynch. Okay.
Now, there has already been some discussion of the
provision in the trade promotion authority bill, and
specifically the phrase, ``Israel or persons doing business in
Israel or Israeli-controlled territories.''
Mr. Duss, your written testimony states, ``Conflating
Israel and the settlements represents a clear threat to the
two-state solution itself, undermining our country's ability to
effectively broker a peace agreement between the Palestinians
and Israelis. This is why it is important and appropriate for
State Department to offer a clarification.''
Can you elaborate or clarify on that?
Mr. Duss. I think what the State Department was saying--and
this is a view that we share very closely with our European
allies--is that, for the U.S. And its partners to be able to
broker a peace in which the disposition of these territories
will be decided bilaterally between negotiations between
Israelis and Palestinians, we cannot acquiesce due to the
conflation of these territories in advance.
Mr. Lynch. Okay.
Let me ask you this. Your testimony also indicates that
blurring the distinction between Israel and its settlements is,
``precisely what most radical elements in the BDS movement
strive to achieve. And it would be hugely counterproductive to
give BDS an unearned win by cooperating in any way with that
conflation.''
Can you elaborate on that and clarify?
Mr. Duss. Yes. Thank you.
I think for many in the more extreme elements of BDS--and,
again, this is why I think the distinction between those who
focus on the settlements in the occupied territories and who
recognize the legitimacy of Israel, the security, and the
continued existence of Israel and whose goal is the two-state
solution--you need to make a distinction between those and the
BDS, who do not recognize Israel's legitimacy, and they see all
of Israel and the occupied territories as illegitimate.
And I think by conflating those things, by treating all
boycotts and all economic pressure as just another part of BDS,
you make the BDS movement out to be much stronger and much
larger than it is.
Mr. Lynch. Okay.
I have 12 seconds left. I will yield back. Thank you.
Mr. DeSantis. I thank the gentleman.
The chair now recognizes the vice chair of the committee,
Mr. Russell, for 5 minutes.
Mr. Russell. Thank you, Mr. Chairman.
Mr. Chairman, in his submitted remarks, Mr. Duss notes that
arguments by the BDS should be addressed in the American
tradition, with thoughtful, considered, and ethical counter-
arguments.
I would like to note for the record that Mr. Duss' father
has accused Israel of war crimes and claimed that modern
Israelis are not descended from Biblical Jews.
I would also like to note for the record that Mr. Duss'
brother is infamous for his tweet, ``Why are so many Israeli
politicians rapists?''
I would also like to note that Mr. Duss' work with the
Center for American Progress reacted in the height of offensive
anti-Semitic rhetoric when he attempted to build his views with
Nazi-era posters on their ThinkProgress Web site. This drew an
extremely rare rebuke of the Center for American Progress
writers from the White House--a very rare thing, indeed--that
these views and tactics were troubling.
In fact, this rebuke also further notes that the Simon
Wiesenthal Center, the Anti-Defamation League, and the American
Jewish Committee have all termed the anti-Israeli rhetoric of a
Mr. Jilani and fellow Center for American Progress writers Eli
Clifton, Ali Gharib, Matt Duss, and Ben Armbruster to be
infected with Jew hatred and discriminatory policy positions
towards Israel.
And so my question would be: Mr. Dubowitz, do you think
that these types of arguments that are coming from this key
witness that has been elevated to testify before Congress, are
these thoughtful, considered, and ethical ways to approach the
issue? Yes or no?
Mr. Dubowitz. So, Congressman, I think that it is
absolutely critical to examine the backgrounds and the writings
and the research of people who appear before your subcommittee.
Mr. Russell. Thank you, sir.
And, Mr. Birnbaum, do you believe such tactics to be
thoughtful, considered, and ethical counter-arguments?
Mr. Birnbaum. No.
And I would take it one step further, and I would like to
correct for the record something that Mr. Duss said. Now, I am
not an international scholar, and I am not a lawyer. But Mr.
Duss said that the BDS does not have a position on the two-
state solution, and they do.
I do know how to read. And I am reading some quotes from
Mr. Omar Barghouti, the co-chair of the BDS. And he said,
``Good riddance. The two-state solution for the Palestinian-
Israeli conflict is finally dead. But someone has to issue an
official death certificate before the rotting corpse is given a
proper burial and we can all move on.'' And there are many
other such quotes.
Mr. Russell. Thank you, sir.
Mr. Kontorovich, do you believe that these are thoughtful,
considered, and ethical approaches for argument?
Mr. Kontorovich. Well, there is a contradiction in this
perspective. Mr. Duss, on the one hand, claims that we should
have discussions and arguments about BDS rather than having
legislation. On the other hand, he acknowledges that Israel has
much-deserved protections against boycotts, in the form of the
anti-Arab League boycott laws, et cetera. That demonstrates
that the American tradition is not simply to discuss trade and
strategic problems but to take action about them.
Mr. Russell. Thank you, sir.
And so, Mr. Chairman, I am somewhat troubled that we have
before us today someone elevated to come and testify before
Congress that might have such a closet to be examined. And I
find these types of approaches to the BDS problem to be
unthoughtful, ill-considered, and of questionable tactics. And,
as a result, I really don't want to hear any more that he might
have to say in this hearing.
Thank you, and I yield back my time.
Mr. DeSantis. The gentleman yields back.
The chair now recognizes the gentleman from Georgia, Mr.
Hice, for 5 minutes.
Mr. Hice. Thank you, Mr. Chairman.
Mr. Dubowitz, do you believe that the BDS is going to
positively or negatively impact the peace process between
Israelis and Palestinians?
Mr. Dubowitz. Congressman, the short answer is negatively.
I mean, if you are launching an economic and financial warfare
campaign against Israel, it is likely to only harden positions,
it is likely to only exacerbate tensions. And I think, as Mr.
Birnbaum has eloquently put it, it has a significant cost, not
just to Israelis but to Palestinians as well.
Mr. Hice. Okay. Well, would you go so far as to say, again,
in your opinion, that BDS really is a threat to Israel as a
Jewish state?
Mr. Dubowitz. I would certainly go that far. And I would
say that BDS, again--I want to just sort of broaden the lens
here. Economic and financial warfare against a close American
ally is a threat to America, and it is a threat to our other
allies.
You know, as I said, there are territorial disputes
happening all over the world that our allies are involved in.
it is one thing for the U.S. Government to have a political
view on those territorial disputes. it is another thing for the
U.S. Government not to support a close ally that is the target
of economic and financial warfare or cyber warfare or military
warfare or any other kind of warfare.
And we need to defend our allies, or this problem will come
to our shores. We learnt that problem with terrorism. Terrorism
was directed against Israelis. They are the canary in the coal
mine, and eventually these threats come to us.
Mr. Hice. All right. You mention a couple things. Defending
our allies is one thing, but you said this is a threat to
America, as well. In one or two sentences, what is the threat
to America?
Mr. Dubowitz. Well, the threat is that there are many
people in the world that have grievances against the United
States, and the international order is changing, with the rise
of China and Russia and the attempt to establish an alternative
financial order. I can talk a little bit more about what that
looks like. But, clearly, these rising powers are interested in
using economic coercion, financial coercion directly against
the United States.
So we need to harden our defenses. In my testimony, I
outline exactly how Congress and the executive branch should
begin to think about this. We need to create an economic
defensive shield to protect American national and economic
interests.
Mr. Hice. Mr. Kontorovich, let me ask you, how much of a
threat do you believe that this poses to Israel's economy as
well as their overall security?
Mr. Kontorovich. The larger threat to Israel's economy and
security comes from the planned measures, the discussed
measures of the European Commission, which are being encouraged
by BDS groups. In the long run, I think they pose a real threat
to both Israel and the viability of a two-state solution.
Like Mr. Dubowitz, I would like to echo that this has a
particularly strong impact on the United States. What the
European Union is trying to do is to use trade, trade
restrictions, and discriminatory trade restrictions, as a tool
of foreign relations. The central pillar of the GATT and World
Trade Organization Trading System, which the U.S. is the
biggest proponent of, is to separate trade policy from foreign
policy disputes. By allowing for discriminatory, targeted, non-
most-favored-nation treatment of Israel, it would set a
precedent that would have significant impacts for a major
trading country like the United States.
Mr. Hice. Okay. Thank you.
Let me go back, Mr. Dubowitz, to you, then. Does Congress,
in your opinion, do we have any options? Is there anything
legislatively that we can or should do towards or against
private organizations that are funding the BDS movement?
Mr. Dubowitz. Well, Congressman, I do think so.
And I want to just echo the comments of Mr. Kontorovich.
And that is that the European Union, again, is attempting to
use economic and financial warfare, in this case against
Israel. And Mr. Kontorovich is right that the European Union
may use this against other American allies.
If the Philippines has a major dispute with the Chinese in
the South China Sea and the European Union decides that, given
the huge EU-Sino trade and economic relationship, that they are
going to side with China over the Philippines, they may
actually be persuaded by the Chinese to use their economic and
financial leverage against the Philippines. And we would have
to defend the Philippines, as a close ally economically and
financially.
And Congress can do that. We certainly--there is a huge
amount of expertise in Congress on the issue of sanctions and
creating not only an offensive sanctions instrument that has
been the focus of the U.S. Government and Congress for years,
but creating a defensive architecture, a defensive shield.
Legislative initiatives that are occurring in Congress
today at the State level in Illinois, in South Carolina, I
think are an important first step. But the U.S. Government
needs to be restructured and reoriented in the way that it
thinks about this economic warfare doctrine. And the
institutions within the U.S. Treasury Department and
elsewhere--I have done a lot of research into this topic, and
they are ill-prepared to defend the United States and our
allies against this new threat of economic and financial
coercion.
Mr. Hice. Thank you, Mr. Chairman. I yield back.
Mr. DeSantis. Maybe Professor Kontorovich, the BDS, are
they trying to boycott regimes like Iran or the Castro brothers
or North Korea, as well?
Mr. Kontorovich. Not only are there not such measures
against countries with massive human rights violations and
breaches of international law, I think what is important to
note is, even at the level of the European Union--forget the
NGOs of the BDS movement for a second--even at the European
level, the rules that they are seeking to impose against Israel
they are not imposing even on other areas and situations where
they believe there are settlements and a military occupation.
Take Western Sahara, for example. The European Union, like
the west of the world, recognizes that it is occupied by
Morocco. The majority of the population there are settlers. On
the other hand, under European law, Moroccan produce from
Western Sahara is labeled ``Made in Morocco'' when imported
into the European. When asked about this, European officials
have said that's completely consistent with European law.
Labeling products is one thing. Sovereign status of
territories is another thing. Indeed, Europe has been entering
into more and more treaties with Morocco, allowing them access
to Western Sahara. European parliamentary documents themselves
concede that Europe's treatment of Israel is inconsistent with
its treatment of other situations they view as similar, in a
way which is even problematic under European notions of
uniformity.
Mr. DeSantis. Mr. Birnbaum, what about in your experience,
when BDS was targeting SodaStream, did you notice them also
targeting soda companies in Iran or North Korea or anything
like that?
Mr. Birnbaum. No, never. From my perspective, it appears
they are blind to any other infractions in the world--assuming
we are an infraction. We are not.
But an important case would be, on the contrary, in the
Nordics, the BDS caused the Nordic retailers, all of them, all
of the Nordic states, to stop sourcing SodaStream product from
the West Bank and sourcing it from the mother of human rights,
China.
So that's not a problem for the Nordic markets, to import
product from China. And we had to terminate, at that point in
time, a few hundred Palestinian workers that could have enjoyed
employment had we been able to continue to source for the
Nordic markets from the West Bank.
Mr. DeSantis. So why the double standard?
Well, I guess we will let people draw their own
conclusions. I mean, I think it is odd that Israel, with this
one country, would have to live under a totally separate
standard than any other country in the rest of the world, in
the eyes of some of these people, and I wonder what motivates
that.
I am done. Mr. Lynch, do you have any more questions?
Mr. Lynch. I do.
Mr. DeSantis. Okay. I will now yield 5 minutes to the
ranking member, Mr. Lynch.
Mr. Lynch. Thank you.
Mr. Duss, there were some very serious accusations made by
the gentleman from Oklahoma earlier in the hearing. While he
asked everybody else their opinion of his accusations of you,
he did not give you an opportunity to address those. So what I
am going to do is I am going to yield my 5 minutes to you. I
also know that he made accusations about stuff that your
brother said. I am not sure how you are going to handle that,
but take whatever time you would like.
I think it is fairness. This is Congress. This is an open
hearing, and we should hear from our witnesses. So I am going
to yield you the balance of my time for you to address the
accusations made against you. Proceed.
Mr. Duss. Thank you, Ranking Member.
I don't want to waste too much time on those. I would--you
know, with regard to my father and my brother, they have both
dedicated their lives to doing humanitarian work around the
world, and I am very proud of them. So I think there have been
statements they may have said in the past that have been taken
out of context.
And with my own work, as well, I stand behind everything I
have ever written. And as I have said earlier here in this
hearing and will continue to say, I stand for a two-state
solution. The security and the continued existence of the state
of Israel and the rights and self-determination of the
Palestinian people--that's the focus of my work, and that's the
reason I am here today.
I would like to address the point about the BDS movement
and is it focusing on any other countries. I think it is quite
fair to bring up other abusive regimes and are they focused. I
think Iran, for one, is the focus of a major international
sanctions campaign on a whole range of issues. Those sanctions
related to its nuclear program, if the deal goes through, will
slowly be taken off. But it would still be focused, it will
still be pressured on human rights issues and terrorism issues.
But I think the key point to keep in mind here is that the
BDS movement, agree or disagree with it, is driven by
Palestinian civil society and a call by Palestinian civil
society groups from 2005 to focus economic pressure on Israel.
In that way, I think it is quite easy to understand why the
Palestinians--they are not being occupied by other countries.
They are being occupied, in their view, by Israel. That's why
Israelis the focus of their campaign.
One other quick response to my colleague Mr. Kontorovich's
comment about boycotts in law. I think it is important, again,
that we keep coming back to this point about distinction. I
would distinguish between civil society actions and law and,
for example, the Arab boycott. These are countries that are
boycotting Israel as a state. Those are countries; these are
not civil society actors.
And, again, here is the distinction with the EU. The way
that the EU is defining and enforcing its own laws is with
regard to making a distinction between the occupied territories
and with Israel. They are happy and want to increase trade with
the state of Israel, but they want to be careful to make a
distinction between Israel and the occupied territories.
Thank you.
Mr. Lynch. Thank you.
I yield back.
Mr. DeSantis. I thank the gentleman.
And I thank the witnesses for coming here and your
testimony.
I think that this trade is going to be something that
Congress, we are going to need to conduct oversight over to
make sure that the law is being applied. I just think it would
be a complete disaster to be negotiating trade agreements with
these European countries, violate this provision, allow them to
do economic boycotts of Israel.
I mean, we are the one that provides the Europeans with
their security, with our defense. I mean, they do not defend
themselves; it is really us. And so I think it is something
that we need to keep an eye on. And I think that this
committee, as negotiations go forward, we are going to look to
conduct the appropriate oversight.
So I thank everybody, and this hearing is adjourned.
[Whereupon, at 3:20 p.m., the subcommittee was adjourned.]
APPENDIX
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Material Submitted for the Hearing Record
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