At our panel discussion at the Wilson Center last week, my fellow panelists Aaron Miller and Rob Malley agreed that the one-state option for Israel and the Palestinians is not a realistic vision for the future. Malley was nice enough to call my book a "masterful deconstruction" of one-state rhetoric. Miller repeatedly called it "brilliant" and said that the book effectively "buries" any notion of a single state arrangement between the river and the sea. However, he added that a New York Times op-ed by Rob Malley and Hussein Agha also raised very serious doubts about the prospects for achieving a conflict ending two-state agreement under the present circumstances.

Everyone who thinks about the problem seriously agrees that there are massive obstacles and that all such doubts are very well-founded. Miller asked the obvious follow-up question: since for the next two years or so we are probably not going to be successful in securing a conflict ending two state agreement, and a single democratic state is not a plausible idea, how can we think outside the box constructively about what sort of arrangements can be developed to improve the situation and lay the foundation for future progress. It’s an extremely challenging problem, but not one that is entirely resistant to any serious answers.

Obviously, any notion of stabilizing the situation or laying the groundwork for progress under circumstances that will be developed in the immediate future will have to be based first and foremost on a settlement freeze. No Palestinians or other Arabs are going to have any confidence in creating conditions for agreement in the medium-term future if Israel continues to gobble up land in East Jerusalem and the West Bank and continues to make the problem far more difficult to solve by introducing increasing numbers of Israeli settlers into the occupied territories. Beyond a settlement freeze and perhaps even beyond the world of diplomacy there have to be other measures that begin to change the equation in a meaningful way, as Miller is suggesting. In my view Palestinian Prime Minister Salam Fayyad has provided the most imaginative, practicable and far-reaching answer to Miller’s question in his government program released earlier this month.

Fayyad’s idea, in a nutshell, is that Palestinians should begin building the administrative and institutional infrastructure of their state in spite of the occupation in order to achieve what he has called "de facto statehood." With a surprising degree of specificity, but also of course some vagueness, the Prime Minister is proposing that Palestinians move quickly to develop legal and administrative structures, ministerial competency and reach, relations between the government and civil society, and infrastructure including a West Bank airport among other crucial pre-statehood measures.

The first thing worth noting is that in spite of a widespread and mistaken reaction to this idea of “de facto statehood” as being nothing more than another attempt to rhetorically establish a Palestinian state as has been done in the past, most notably in 1988, Fayyad’s approach is in fact fundamentally different than anything that has been tried in the past, at least as a strategy for liberation. True enough, the PLO and PA have established institutions in the past, particularly under the Oslo rubric, but what Fayyad is proposing is different. Earlier declarations of independence and statehood were intended to be self-fulfilling exercises, and were essentially political and diplomatic gestures aimed at securing support for the concept of an independent Palestine. Previous institution building has been formulated around the concept that statehood should be declared and accepted, and then developed in practice.

Fayyad has deviated from both of these positions by suggesting that the Palestinians should build, “strong state institutions capable of providing, equitably and effectively, for the needs of our citizens, despite the occupation.” He essentially reverses the traditional Palestinian approach of securing recognition and legal status for statehood first before addressing the construction of state institutions, with the document seeking to lay out a plan to build “institutions of the independent State of Palestine in order to establish a de facto state apparatus within the next two years.”

In doing so, Fayyad is recognizing three important points that have not figured sufficiently into previous thinking by the PA, the PLO, Fatah or other Palestinian national entities.

First, it is not true that even though there is a diplomatic impasse there is therefore nothing Palestinians can do to address their national needs and priorities. He is in effect arguing that the Palestinians can and should proceed with the business of building serious state institutions, that is to say creating new “facts on the ground” in spite of the continuation of the occupation. Obviously, the occupation greatly complicates the process, but what the program recognizes is that even under such circumstances, if they are clear about their purposes and employ intelligent strategy and tactics, the PA is entirely capable of developing the core institutions of a functional state. It also calls Israel’s bluff, and puts the Israelis in the position of having to either not interfere with Palestinian institutional and economic development or take crude, unilateral actions to prevent it, and pay the diplomatic and political price for such outrageous oppression and obstructionism.

The second thing Fayyad’s program recognizes is that without these state institutions, statehood and independence could be compromised. Because of decades of occupation, violence, corruption, intifada, mismanagement and other factors, the institutions of Palestine are severely damaged or have never been formed, to the point that if Palestinians achieve their independence tomorrow, governance would be an immediate problem because the infrastructure of government is not fully developed or has been damaged or destroyed. What this program suggests, and rightly so, is that building state institutions is a national priority for the Palestinians if independence is their overriding national goal.

Third, the program recognizes that institution building is itself a particularly important and powerful weapon of resistance to occupation. The further Palestinians go in developing their state institutions, as Fayyad has put it, “de facto statehood in spite of the occupation,” the more this undermines the reality of the occupation and advances the Palestinian agenda of independence and freedom.

The idea that building state institutions before independence is some kind of capitulation to occupation is completely wrongheaded (most enthusiastically promoted by people who are, in fact, opposed to Palestinian independence). History suggests that most successful postcolonial states began developing their state infrastructure with or without the cooperation of the occupying powers before independence was achieved. The sooner and more fully they were able to do this, generally speaking the more successful the postcolonial state has proven in practice.

The Israeli case is another instructive model, in which Jewish settlers in Palestine had created most of the key state institutions by the early to mid-1930s, long before the Israeli state came into being and when the Jewish community in Palestine was a small minority. The Zionist movement operated on two principles in this regard: first, that state institutions make statehood possible and at some point inevitable, and second that institutions were more important to Jewish statehood than achieving a demographic critical mass (one might call this the “build it and they will come” model).

Obviously, the Palestinians find themselves in a very different situation. However, both anti-colonial and Israeli history, among others, suggest very strongly that building state institutions with an eye to independence is not only not a form of “collaboration with occupation,” it is, or at least it should be, a most powerful and effective weapon of resistance. One notes that one of the most passionate objections to the program has come from Israel’s ultra-right wing Foreign Minister, Mr. Lieberman, who is well aware of this and does not like it one bit.

There are going to be many potential answers to Aaron Miller’s inescapable question. But it seems to me that this program of unilateral, proactive and constructive Palestinian infrastructure and administration development to create a de facto state in preparation for statehood and in order to make statehood more likely if not inevitable is an excellent example of thinking outside the box and not relying on hopes for a conflict ending agreement in the next two years. It is entirely consistent with publicly stated American, Israeli and Palestinian positions, and only people fundamentally opposed the concept of independent Palestinian statehood can be opposed to it. In a typically brilliant Al Hayat column, Raghida Dergham, laid out precisely why the Arab states too should welcome this move. Everyone should be taking this seriously, and doing what they can to help it succeed.