Welcome to Israel's first settler university

Ariel University is part academic institution, part political statement.

With the well-kept grass verges and cafes serving paninis and chilled beer and coke, Ariel University could resemble any modern campus college in Britain or the US. It isn’t: it is Israel’s first settler university, given official status with a great deal of controversy in July. With Salfit to its south and Nablus further to its north, Ariel is deep inside the West Bank. It is one of the major population centres annexed to "greater Israel" by the construction of the separation wall, whose route loops around the city, taking vast tracts of land from local Palestinian communities.

To look at, Ariel’s campus and media presence barely hints at the significance of its geographical location. Its emphasis, couched in the semi-managerial language becoming common to the academic world, is on “reaching out to every corner of Israeli society”, “research excellence” and “keeping its finger on the pulse of the needs of the Israeli economy”. The tension between Ariel’s claim to be normal university and its political role in cementing an Israeli civilian population in the West Bank is rapidly becoming a symbolic battleground over the future viability of a two-state solution, and, for many, a sign that Israel’s academia should be boycotted internationally.

The pretence to normality that emanates from Ariel is echoed by its students. “I don’t want to say I don’t care about these issues,” says Avishi, an economics student from Haifa, “but I study and live here – I don’t really follow it.” Sitting with Avishi and two of his classmates on a picnic bench outside a library on the university’s upper campus, I ask them why they chose Ariel. Talya, a media and communications student from Ashkelon replies. “I didn’t really think about the fact that it was in the West Bank. The main reason I chose Ariel was that my grades from high school were bad, and I couldn’t get into Be’er Sheva.”

Then, in an almost surreal moment, everyone at the table gestures to the sunset over the West Bank – “and the views are also amazing,” she says. When I ask which Palestinian town we are looking at, no one can tell me.

These unknown Palestinian villages all knew what Ariel was: the settlement exists because of land taken from the very villages that make up its picturesque views; the grass growing under our feet was almost certainly possible only because of the vast stocks of water which have been taken from under the West Bank – leaving most Palestinians either short or cut off entirely. Ariel’s sewage has on several occasions been allowed to spill over into neighbouring Salfit, polluting its water supply.

This is the bizarre reality that Ariel University’s establishment both reflects and promises for Israel. For the inhabitants of this new seat of academic inquiry, the scenery that rolls out into the sunset across from the hill-tops of Ariel is inanimate, its inhabitants and their concerns are picturesque, but not an issue.

The wilful moral oblivion that can be observed on campus is not merely a question of ignorance, especially given that most students will have done military service and seen the occupation. Rather, it is the ideological symptom the fact that Ariel’s academics and students are becoming an integral part of a project of colonial normalisation. West Bank settlements are illegal under international law primarily because the Fourth Geneva Convention prohibits occupying powers from moving their civilian population into the occupied area. In these terms, the establishment of a university here could not be clearer in the message that it has sent.

With a population of around 19,000, Ariel is now host to 14,000 students – and the university aims to make it 20,000 by 2020. Ariel’s new university is not a part of the natural growth even, as a true-believer would put it, of "any normal city in Israel". Here, far from being dragged along reluctantly, academics are playing a leading role in Israel’s colonial project.

Any attempt to recognise Ariel University internationally will almost certainly be met with protest – but the situation also raises renewed questions about the role and credibility of Israeli academia more generally. Its seeming inclusion into the fold of Israeli universities is symbolic because it demonstrates the extent to which Israeli society has become enmeshed with its colonisation of the West Bank.

Just as it is often impossible to tell whether Israeli grapes in any given supermarket are from Israel itself or from its West Bank settlements, Ariel’s presence as a university will further intertwine self-assuredly normal Israelis with the Occupation. As Liel, another of Ariel’s Economics students put it to me: “It’s obvious. [Ariel] will be harder now to evacuate in negotiations... People in Israel will be forced to really fight for Ariel if their kids are at school here.”

What makes Ariel’s university status particularly notable in this process is that many ostensibly normal – or even supposedly leftwing – parts of Israeli civil society have begun to support it, often from behind the language of academic freedom and democracy. A recent letter signed by the student union heads of several Israeli universities defended Ariel’s upgrade to university status, stating that “we must not forget that there should be a complete separation between academia and Israeli politics.”

There has been opposition from Israeli universities to the Ariel’s status upgrade, but it has been partial and often caveated. Last week, university heads presented an appeal to the Israeli High Court asking calling on for the decision to be reversed. It was couched cautiously, and, like most of the mainstream debate about Ariel, in terms of funding; the primary references to the university’s illegality are limited to its contravention of procedure, rather than expropriation of Palestinian land or role in the Occupation. When individual academics came out in large numbers and said that they would boycott Ariel, Rivka Carmi, the chair of the head of universities group, attacked them, again citing academic freedom: "Academic activity is supposed to be detached from ideological or political appeals.”

Meanwhile, Ariel’s existence is a political act with every passing day, not only in terms of its location and role in the occupation, but also in the activities of its leadership. Yigal Cohen-Orgad, its Chancellor and a former Likud Member of the Knesset, has already used his position to demand that students be forced to swear allegiance to the state of Israel before being allowed to study – a measure whose primary effect will be to humiliate or exclude the Palestinian population in higher education.

The question of how international civil society should interact with Israeli institutions has always been a sharp one. For years, Britain’s academics’ union, the UCU, has along with a growing number of trade unions internationally, adopted a full boycott of Israeli universities and official cultural institutions – and this pressure is only likely to grow in the wake of the establishment of a university inside the occupied West Bank. If there is one thing that the experience of the past few years of steady colonisation has shown, it is that without being made to pay the price of the occupation, it is difficult to imagine Israeli civil society or its official institutions moving towards a just peace.

Student accommodation in the Ariel settlement in the West Bank. Photograph: Getty Images
Ralph Orlowski / Getty
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Labour's investment bank plan could help fix our damaging financial system

The UK should learn from the success of a similar project in Germany.

Labour’s election manifesto has proved controversial, with the Tories and the right-wing media claiming it would take us back to the 1970s. But it contains at least one excellent idea which is certainly not out-dated and which would in fact help to address a key problem in our post-financial-crisis world.

Even setting aside the damage wrought by the 2008 crash, it’s clear the UK’s financial sector is not serving the real economy. The New Economics Foundation recently revealed that fewer than 10% of the total stock of UK bank loans are to non-financial and non-real estate businesses. The majority of their lending goes to other financial sector firms, insurance and pension funds, consumer finance, and commercial real estate.

Labour’s proposed UK Investment Bank would be a welcome antidote to a financial system that is too often damaging or simply useless. There are many successful examples of public development banks in the world’s fastest-growing economies, such as China and Korea. However, the UK can look closer to home for a suitable model: the KfW in Germany (not exactly a country known for ‘disastrous socialist policies’). With assets of over 500bn, the KfW is the world’s largest state-owned development bank when its size is measured as a percentage of GDP, and it is an institution from which the UK can draw much-needed lessons if it wishes to create a financial system more beneficial to the real economy.

Where does the money come from? Although KfW’s initial paid-up capital stems purely from public sources, it currently funds itself mainly through borrowing cheaply on the international capital markets with a federal government guarantee,  AA+ rating, and safe haven status for its public securities. With its own high ratings, the UK could easily follow this model, allowing its bank to borrow very cheaply. These activities would not add to the long-run public debt either: by definition an investment bank would invest in projects that would stimulate growth.

Aside from the obviously countercyclical role KfW played during the financial crisis, ramping up total business volume by over 40 per cent between 2007 and 2011 while UK banks became risk averse and caused a credit crunch, it also plays an important part in financing key sectors of the real economy that would otherwise have trouble accessing funds. This includes investment in research and innovation, and special programs for SMEs. Thanks to KfW, as well as an extensive network of regional and savings banks, fewer German SMEs report access to finance as a major problem than in comparator Euro area countries.

The Conservatives have talked a great deal about the need to rebalance the UK economy towards manufacturing. However, a real industrial policy needs more than just empty rhetoric: it needs finance. The KfW has historically played an important role in promoting German manufacturing, both at home and abroad, and to this day continues to provide finance to encourage the export of high-value-added German products

KfW works by on-lending most of its funds through the private banking system. This means that far from being the equivalent of a nationalisation, a public development bank can coexist without competing with the rest of the financial system. Like the UK, Germany has its share of large investment banks, some of which have caused massive instabilities. It is important to note that the establishment of a public bank would not have a negative effect on existing private banks, because in the short term, the UK will remain heavily dependent on financial services.

The main problem with Labour’s proposal is therefore not that too much of the financial sector will be publicly owned, but too little. Its proposed lending volume of £250bn over 10 years is small compared to the KfW’s total financing commitments of  750 billion over the past 10 years. Although the proposal is better than nothing, in order to be effective a public development bank will need to have sufficient scale.

Finally, although Brexit might make it marginally easier to establish the UK Investment Bank, because the country would no longer be constrained by EU State Aid Rules or the Maastricht criteria, it is worth remembering that KfW’s sizeable range of activities is perfectly legal under current EU rules.

So Europe cannot be blamed for holding back UK financial sector reform to date - the problem is simply a lack of political will in the current government. And with even key architects of 1980s financial liberalisation, such as the IMF and the economist Jeffrey Sachs, rethinking the role of the financial sector, isn’t it time Britain did the same?

Dr Natalya Naqvi is a research fellow at University College and the Blavatnik School of Government, University of Oxford, where she focuses on the role of the state and the financial sector in economic development

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