In fact, both sides achieved significant gains that may ultimately outweigh their losses and shift the dynamics of the conflict into a stable equilibrium. Israel made concrete strategic and diplomatic gains in its decades-long quest to pacify its northern border, while failing spectacularly to achieve rather fanciful declared objectives and tarnishing its image of military invincibility (a disastrous combination in Israeli politics, but hardly a crushing national setback). Hezbollah won a resounding political victory at home, at the expense of constrained freedom of action to fight Israelis abroad, a state-sanctioned indulgence that most Lebanese Shiites would just as soon the group give up (while remaining armed).
The war was less favorable to non-participants. The Israeli onslaught appears to have eroded public confidence in Lebanon's ruling March 14 coalition by demonstrating that its most attractive perceived virtue (American backing) was largely a mirage and exposing the political paralysis and corruption of the state. The Bush administration gained some strategic leverage over Iran, but its unswerving support for the Israeli campaign fueled a spike in anti-American sentiments in Lebanon and the region, while Arab governments that tacitly followed its lead suffered a major public relations setback. While Iran and Syria loudly rejoiced at seeing their Lebanese ally take to the battlefield against Israel, the political payoffs accrue mainly to Hezbollah alone and will militate against future outside efforts to incite anti-Israeli violence from Lebanese soil.
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