European Union
Euro zone retail sales back in decline in June, France a bright spot. Pictured, European Union building. Reuters

Ever wonder about the European Union, a sometimes unwieldy body of 28 nations, each of which sacrifices some measure of its national sovereignty in order to help make continent-wide policy?

The EU certainly can leave heads a-shaking, as it did recently in announcing two major policies related to the Middle East that, together, showcase its moral confusion, factual ignorance and political clumsiness.

First, the EU issued guidelines, which took effect last week, that prohibit its members from “all funding, cooperation, and the granting of scholarships, research grants, and prizes” to Israeli entities that operate beyond the “1967 borders” -- that is, in East Jerusalem and the West Bank. The guidelines will cover projects financed by the EU’s long-term budget, which runs from 2014 to 2020.

Then, this week, EU foreign ministers designated just the military wing of Hezbollah, the Lebanese-based group, a terrorist organization, thus exempting the group’s political wing and social operations.

Neither its Israel-related boycott nor its Hezbollah designation will likely advance the EU’s goals.

The boycott in connection with areas that Israel won while defending itself in war also requires that contracts between EU members and the Jewish State include a clause stating that those areas are not part of Israel.

The boycott reflects the EU’s position that Israeli settlements in East Jerusalem and the West Bank are illegal under international law -- a position that Israel’s former ambassador to Canada, Alan Baker, wrote this month is “based on a series of long-standing and deliberately misleading and flawed legal and political assumptions.”

The boycott is designed to pressure Jerusalem to halt its settlement activity, as the Palestinian Authority, or PA, demands, in hopes of spurring Israeli-Palestinian talks that produce the “two-state solution.”

But, as President Obama learned early on, outside pressure of this kind on Jerusalem will not promote peace but, instead, set it back. When Obama pressured Israeli Prime Minister Benjamin Netanyahu to freeze settlements in 2009, PA President Mahmoud Abbas refused to offer his own concessions because, politically, he could not take a softer line against Jerusalem than Obama. That drove Israel and the PA further apart.

The same dynamic will likely play out on the EU’s boycott. With the EU declaring, in essence, that post-1967 settlements of any kind are illegal, Abbas will be hard-pressed to convince his own constituents that they should accept a peace deal that adjusts the 1967 borders to on-the-ground reality.

As one Israeli official told the New York Times, “Why would any Palestinian leader agree to re-engage if they can get what they want without negotiating? Why enter the give and take of negotiations when you can just take what is offered by international bodies?”

That the boycott will hurt Palestinian workers as much as the Israeli businesses that hire them -- and that may have to fire them if the boycott shrinks their bottom lines -- is just another sign of the EU’s misguided approach.

Thus, the boycott provides more nails for the all-but-certain coffin where Secretary of State John Kerry’s peace efforts will soon reside.

To be sure, Kerry announced that the two sides had agreed at least to talk about eventually talking about peace. Fine. But there’s plenty of reason for skepticism that they’ll ever reach the latter stage and, even if they do, that they’ll find ways to overcome the huge obstacles to a lasting peace.

For starters, any talks between Israel and the PA will have to ignore Hamas, which rules Gaza, vehemently opposes talks, and remains irretrievably committed to Israel’s destruction. Israeli-Palestinian talks that exclude Hamas, in turn, can produce at best only a partial peace agreement.

The EU’s broad boycott contrasts sharply with its narrow designation of Hezbollah’s military wing as a terrorist organization. While the former will complicate Israeli-Palestinian peace-making, the latter will do less to constrain Hezbollah than many may assume.

That’s because, as its leaders boast, Hezbollah operates as a coherent whole whose military, political, and social parts reinforce one another. No firewalls exist between those who murder innocents, those who seek office in Lebanon, and those who provide social services to nurture public support.

“[W]e never divided our movement in such a way that we would have different projects,” Hezbollah’s deputy secretary-general Na’im Qassem said at a political meeting in late May. “Therefore, all our martyrs in every position are martyrs [who perished] by force of the obligation [to wage] jihad.”

Besides, the EU’s designation does not by itself impose sanctions even on the military wing, a French diplomat told the London-based Al-Hayat newspaper. It merely frees EU members to impose their own sanctions and, with the presence of Hezbollah agents on the continent, they may hesitate to do so.

So, the EU sanctions the Middle East’s only democracy based on flawed legal and political reasoning, and it sanctions the region’s most dangerous terrorist organization based on flawed notions about the group.

That’s not terribly inspiring.

Lawrence J. Haas, former communications director for Vice President Al Gore, is a senior fellow at the American Foreign Policy Council and author of “Sound the Trumpet: The United States and Human Rights Promotion.” Follow him on Twitter @larryhaasonline.