Donald Trump produced one of the most extraordinary foreign-policy proposals of his presidency this week. Standing beside Israeli Prime Minister Benjamin Netanyahu at the White House on 4 February, Trump said the United States could “take over” the Gaza Strip, clear unexploded ordnance and destroyed buildings, redevelop the territory and transform it into what he described as the “Riviera of the Middle East”. He also argued that Palestinians living in Gaza should be relocated elsewhere, suggesting neighbouring Arab countries could provide land where they could live instead. The proposal immediately generated opposition from Egypt, Jordan, Saudi Arabia and Palestinian leaders, while the White House subsequently attempted to clarify aspects of Trump’s remarks, including whether relocation would necessarily be permanent and whether American troops would be required. The proposal is unlikely to become policy in anything resembling its most expansive form. Its significance lies elsewhere. It exposes a recurring weakness in international politics: powerful states often become extremely detailed when discussing how territory should be governed and remarkably vague when discussing whether the people living on that territory consent to the plan.
There is a genuine reconstruction problem beneath Trump’s proposal. Gaza has suffered extraordinary physical destruction after more than fifteen months of war. Homes, roads, schools, hospitals, water systems and electricity infrastructure have been damaged or destroyed, while unexploded munitions and enormous quantities of rubble complicate rebuilding. Even if the current Israel-Hamas ceasefire becomes permanent, hundreds of thousands of people cannot simply return to ordinary economic life immediately. Reconstruction will require tens of billions of dollars, years of work and extensive international coordination. Someone will need to remove rubble. Someone will need to finance housing. Someone will need to provide security while reconstruction occurs. Trump’s instinct that Gaza requires something much larger than emergency humanitarian assistance is therefore correct. The problem is the political architecture he proposes around it.
Reconstruction is not primarily a real-estate problem. A destroyed city cannot be treated like an abandoned development site because the land already contains property claims, communities, political identities and people with legal rights. The economic value of rebuilding Gaza therefore cannot be separated from who controls the territory afterwards and whether displaced Palestinians retain the right to return to their homes.
This distinction between physical capital and political ownership is fundamental. Bulldozers can clear rubble. Engineers can construct apartment buildings. Foreign investors can finance hotels. None of those activities answers who possesses sovereignty over the land.
Trump’s business language therefore risks treating political conflict as an optimisation problem: remove damaged assets, relocate residents temporarily, rebuild more efficiently and generate a more valuable piece of territory.
That framework works reasonably well for property whose ownership is uncontested.
Gaza is almost the opposite.
Every square kilometre carries political and historical claims.
This is why the relocation component generated such immediate opposition. Roughly two million Palestinians live in Gaza, and most are themselves refugees or descendants of refugees displaced during the wars surrounding Israel’s creation. Asking this population to leave during another war therefore cannot be interpreted as ordinary temporary evacuation without confronting that history.
The critical variable is voluntariness.
A Palestinian family freely choosing to move to Egypt, Jordan, Europe or elsewhere should be able to do so where immigration rules permit.
A policy deliberately creating conditions under which an entire population has no realistic alternative to leaving is fundamentally different.
This is why international law treats forcible population transfer so seriously.
The question is not merely whether buses or soldiers physically compel someone across a border.
It is whether people possess a genuine choice to remain.
This creates a serious problem with Trump’s argument that Gaza is currently too destroyed for Palestinians to live there. The destruction itself resulted from war. If destruction becomes the justification for permanent relocation, military devastation can indirectly alter the demographic ownership of territory.
That creates an extremely dangerous incentive internationally.
Destroy enough infrastructure and displacement becomes self-justifying.
International rules against forced transfer exist partly to prevent exactly that mechanism.
Egypt and Jordan’s opposition therefore is not simply unwillingness to help Palestinians. Both governments fear that “temporary” relocation could become permanent, effectively resolving part of the Israeli-Palestinian territorial conflict by moving Palestinians into neighbouring states.
Jordan already contains a large population of Palestinian origin.
Egypt fears instability in the Sinai Peninsula.
Both also reject the principle that the solution to Palestinian displacement should be additional Palestinian displacement.
Their incentives are strategic as well as humanitarian.
Accepting millions of refugees creates enormous fiscal and political costs.
Housing.
Schools.
Healthcare.
Employment.
Infrastructure.
Security.
Refugees do not arrive as abstract humanitarian units.
They enter real labour and housing markets.
This creates another distributional problem. A wealthy foreign government can advocate relocation while neighbouring countries absorb most of the immediate cost.
Trump’s proposal therefore illustrates the difference between designing a solution and internalising its costs.
The United States could theoretically finance enormous amounts of resettlement.
Egypt and Jordan would still experience demographic and political consequences Washington would not.
This is why countries closest to conflicts frequently evaluate refugee policy differently from distant governments.
The same issue appeared with Venezuelan migration in Colombia and Syrian refugees in Turkey.
Proximity changes the cost function.
Saudi Arabia’s response is particularly important because Trump’s proposal intersects with another major strategic objective: Saudi-Israeli normalisation. Before the Gaza war, Washington was attempting to broker formal diplomatic relations between Riyadh and Israel, potentially producing one of the largest changes in Middle Eastern diplomacy since the Abraham Accords.
Saudi Arabia has now reiterated that it will not establish diplomatic relations with Israel without progress towards a Palestinian state.
This means Gaza cannot simply be separated from the broader regional settlement.
Israel may obtain short-term territorial or security advantages through one policy while losing the possibility of a much larger strategic relationship with Saudi Arabia.
This is the difference between local optimisation and system optimisation.
A policy can improve Israel’s immediate position in Gaza while worsening its regional position.
Saudi normalisation could provide Israel with economic relationships, security cooperation and greater integration into the Arab world.
Those gains need to be compared with whatever benefit a permanent restructuring of Gaza might provide.
This is why the two-state solution, despite appearing increasingly remote, remains difficult to replace conceptually. It attempts to solve two political demands simultaneously: Israeli self-determination and security, and Palestinian self-determination and sovereignty.
Alternative proposals generally solve one more clearly than the other.
Permanent Israeli control improves some Israeli security objectives while denying Palestinian sovereignty.
A single democratic state creates formal equality but raises profound questions about national identity and security for both populations.
Permanent external administration postpones rather than resolves sovereignty.
Mass relocation solves territorial friction by moving one population, which is precisely why it is politically and legally unacceptable to Palestinians and much of the international community.
The persistence of the two-state framework therefore does not prove it is currently easy.
It demonstrates that alternative equilibria contain even larger contradictions.
Trump’s proposal does identify one genuine weakness in previous diplomacy: international actors repeatedly discuss a Palestinian state without explaining sufficiently how Gaza and the West Bank become economically viable and securely governed.
A future Palestinian political system would need functioning institutions.
Police capable of maintaining order.
A government possessing legitimacy.
Borders and trade arrangements.
Infrastructure.
Mechanisms preventing armed organisations from monopolising force.
Economic access sufficient to create employment.
Statehood without state capacity would remain unstable.
This is where reconstruction could become part of a serious political strategy.
Imagine international financing tied to a broader agreement under which Gaza is reconstructed, Palestinian governance is reformed, Arab states participate in security and administration temporarily, Israel receives enforceable security guarantees and Palestinians receive a credible pathway towards political sovereignty.
That would still be extraordinarily difficult.
But it would connect economic reconstruction to political settlement rather than treating development as a substitute for politics.
Trump’s Riviera language reverses that sequence.
Build prosperity first and assume political conflict becomes less important.
There is a logic behind this. Economic interdependence can reduce conflict incentives. People with jobs, homes and investments have more to lose from war.
But prosperity cannot substitute for political rights indefinitely.
Hong Kong is wealthier than many democracies.
That did not eliminate political demands.
Catalonia is prosperous.
That did not eliminate nationalism.
Northern Ireland required political institutions alongside economic development.
Identity conflicts are not simply poverty problems.
The Israeli-Palestinian conflict certainly is not.
This is the limits-of-economic-determinism problem.
Economic incentives shape political behaviour.
They do not erase sovereignty, memory or identity.
A Palestinian may prefer a poorer sovereign state to a wealthier life under permanent foreign administration.
An Israeli may accept economic costs for security.
Material welfare is one component of political utility, not the entire function.
This is also why Trump’s proposal may appeal to his broader worldview. He often approaches international politics transactionally: territory, trade deficits, defence spending and market access become negotiable assets.
That approach can expose inefficiencies traditional diplomacy accepts unnecessarily.
But it can also underestimate non-fungible political goods.
Sovereignty is difficult to price.
Sacred territory is difficult to price.
National identity is difficult to price.
People routinely accept enormous economic costs to defend them.
Ukraine has demonstrated this for three years.
If political actors behaved only according to material welfare, Ukrainians could have accepted Russian territorial demands much earlier and avoided enormous destruction.
They did not because independence itself possesses value.
Palestinians are unlikely to behave differently merely because Gaza could theoretically be rebuilt into something economically attractive.
The proposal also creates a credibility problem for American foreign policy elsewhere. Washington has spent years defending the principle that territory cannot legitimately be acquired or populations displaced through force, particularly in response to Russia’s invasion of Ukraine.
If the United States simultaneously entertains taking control of Gaza and relocating its population, adversaries will inevitably point towards inconsistency.
The circumstances are not identical.
Israel did not invade Gaza in 2023 to annex it in the same way Russia invaded Ukraine.
The war followed Hamas’s 7 October attack.
But once policy moves from defeating Hamas towards permanently altering who lives on the territory, the legal and political comparison becomes harder to dismiss.
International norms gain power through consistency.
A rule invoked only against adversaries becomes coalition policy rather than universal principle.
This is why American officials should care about the precedent even if they believe a Gaza redevelopment plan could produce better material conditions.
The United States derives enormous strategic benefit from an international order where territorial conquest and forced population transfer are considered illegitimate.
Those norms protect allies.
They constrain rivals.
Weakening them in one theatre creates rhetorical and eventually behavioural space elsewhere.
Again, rules are strategic assets.
They are most valuable when powerful states accept constraints from them too.
The proposal also complicates the current ceasefire. Hamas still holds hostages. Israel wants them returned. Negotiations are supposed to move towards a second phase involving further hostage releases and a more durable end to fighting.
If Palestinians conclude the eventual objective is their removal from Gaza regardless of what happens to Hamas, incentives change dramatically.
Why surrender leverage if the political outcome after surrender is displacement anyway?
This is another credible-commitment problem.
A negotiated disarmament or political transition requires combatants to believe compliance produces a tolerable future.
If defeat appears existential, fighting becomes more rational.
This is why successful peace settlements usually provide losers with some place inside the post-war order.
Not necessarily power.
But survival.
Rights.
Political participation.
A future.
The same principle applied to Alawites after Assad and regime officials in Venezuela.
People relinquish coercive leverage more readily when they do not believe relinquishing it means elimination.
A reconstruction plan therefore needs to give Palestinians stronger reasons to support demilitarisation, not stronger reasons to fear what follows it.
The immediate reaction from Netanyahu has been more positive because Trump’s proposal expands the range of options considered publicly in Washington. Israeli far-right politicians have long advocated encouraging Palestinian emigration from Gaza, and Trump’s remarks give versions of that idea unprecedented legitimacy from an American president.
But Netanyahu himself faces the same strategic trade-off.
A policy popular with parts of his domestic coalition could make Arab normalisation harder and increase international isolation.
Again, domestic coalition incentives and national strategic incentives can diverge.
Politicians maximise survival in government.
States theoretically maximise long-term national welfare.
Those objectives overlap imperfectly.
This is one reason parliamentary coalition structures matter to foreign policy.
Small parties can possess leverage disproportionate to their national vote share when governments depend on them for survival.
Israel’s post-war strategy therefore cannot be understood only through military calculations.
Coalition arithmetic enters the security function.
The United States has leverage here because Israel remains deeply dependent on American military support, diplomatic backing and strategic cooperation.
Trump’s relationship with Netanyahu may therefore allow him to influence Israeli policy substantially.
The question is what he uses that leverage to achieve.
A serious regional settlement involving Saudi normalisation, Gaza reconstruction and Palestinian political reform could transform the Middle East.
A plan centred on population relocation could produce the opposite: greater Arab opposition, stronger Palestinian resistance and weaker international legitimacy.
Trump likes large deals.
Gaza genuinely requires one.
The problem is defining who participates in the deal.
A transaction negotiated by Washington and Jerusalem about where Palestinians should live is not a durable political settlement because Palestinians are not assets owned by either government.
This sounds obvious.
International politics repeatedly forgets it.
Great powers draw borders.
Governments exchange territories.
Peace conferences determine security arrangements.
The people living under those arrangements then determine whether they survive.
That is the missing variable in many externally designed settlements.
Consent is not merely a moral requirement. It is a stability mechanism.
A political order that millions reject needs greater coercion to maintain.
Coercion increases cost.
Higher cost reduces durability.
An arrangement with broader consent can survive with less force.
This is institutional economics applied to sovereignty.
Trump’s proposal should therefore be evaluated according to the same standard as every other reconstruction plan:
Does it reduce the expected probability of another war?
Does it create legitimate governance?
Does it protect Israeli security?
Does it preserve Palestinian political rights?
Can neighbouring states accept it?
Can it attract enough financing?
Will the people expected to live under it cooperate?
The Riviera imagery answers almost none of those questions.
Gaza absolutely needs reconstruction.
It may require international administration during part of that process.
Arab states may need to participate.
Hamas cannot simply return to the political-military equilibrium existing before 7 October.
Israel needs credible security guarantees.
All of those propositions can be true without concluding that two million Palestinians should leave.
The hardest part of reconstruction is not concrete.
It is political ownership.
Who governs.
Who belongs.
Who returns.
Who provides security.
Who possesses sovereignty.
Those questions cannot be bulldozed with the rubble.
Trump’s proposal is therefore valuable in one unintended sense.
It makes the underlying issue unusually clear.
The international community can probably find enough engineers to rebuild Gaza.
It can probably find enough capital if Gulf states, Europe and America agree on a framework.
What it has not found is a political arrangement that both Israelis and Palestinians believe leaves them safer than continued conflict.
That remains the binding constraint.
Until it is solved, rebuilding Gaza without resolving its political status risks constructing expensive infrastructure on top of the same unresolved war.
And moving the people instead does not solve the conflict.
It merely moves the injustice, instability and grievance somewhere else.
