Oct. 27 (Bloomberg) -- There’s something very wrong with the way a 574-page report on last winter’s Gaza war has hijacked the public debate about the Israeli-Palestinian conflict.

The inquiry, led by South African jurist Richard Goldstone, was supposed to investigate alleged war crimes committed by Hamas militiamen and Israeli soldiers before and during the 22- day war. Instead, it only whipped up outrage with an uneven focus on Israeli transgressions, adding yet one more obstacle to an already stalled peace process.

The result is what Robert Malley, who directs the Middle East program at the International Crisis Group in Washington, calls a “lose-lose-lose situation.” All sides in the Middle East triangle -- the Israelis, the Palestinians, and the U.S. -- have been damaged by the affair.

The Israelis, feeling embattled, have sunk into an angry defensive crouch. The U.S., having pressed the Palestinians to shelve the report, has lost political capital with the Arab world. Palestinian Authority President Mahmoud Abbas, who initially agreed to withdraw a resolution endorsing the Goldstone report, has had to retreat under heavy criticism from Palestinians and other Arabs.

Goldstone’s fact-finding mission may have been flawed, but the bigger problem is how everybody involved has managed to get tied up in a diplomatic pretzel.

“The issue is less the report, than the way it has been dealt with,” said Malley, who was a special Middle East adviser in President Bill Clinton’s administration. “It has been a major failure on all parts.”

The question now is how to move past this highly toxic episode and onto the substance of the decades-long conflict between Israelis and Palestinians.

Diplomatic Fumbling

It didn’t have to be this way. The Israelis decided the inquiry would be unfair as soon as Goldstone accepted the mission from the United Nations Human Rights Council, which has a long record of anti-Israel bias. That’s why they chose not to cooperate with Goldstone, which as he himself has said repeatedly, only undercut their case in his report.

What Israel should have done then was launch an investigation of its own, and preempt Goldstone’s findings. It can still do that now. This is what the U.S., France, the U.K., and even Russia and China -- the five permanent members of the UN Security Council -- are now urging both sides in the conflict to do, after some spectacular diplomatic fumbling of their own.

It may be that the Palestinian authorities in Gaza won’t follow suit; Hamas, now in control, is, after all, a terrorist organization and not given to observing international law.

But if Israel were to take the initiative, it would be credited with assuming a proactive stance, to deal objectively with serious charges made about its conduct of a war. By Israel’s own count, 1,166 Palestinians were killed, 295 of whom were “uninvolved,” including 89 children younger than 16.

1983 Inquiry

There is a precedent for such an inquiry. In 1983, a special Israeli commission, headed by Yitzhak Kahan, a former Supreme Court justice, investigated the massacre of some 800 Palestinian civilians by Christian militiamen during the Israeli invasion of Lebanon in 1982, and found Israel’s defense minister, Ariel Sharon, “indirectly responsible through negligence.” Sharon was forced to resign.

So far, however, Prime Minister Benjamin Netanyahu, remains determined to continue an all-out diplomatic effort to bury the Goldstone investigation, and shame the UN.

“Our struggle is to de-legitimize the continuing attempt to de-legitimize the state of Israel,” he recently told his Cabinet ministers.

Last week, the Israeli Cabinet was split on a proposal to create a state commission of inquiry, whose members would be appointed by the Supreme Court. The Defense Ministry argues such an investigation would interfere with some 100 probes into the war, including 20 criminal ones. Officials from the foreign and justice ministries -- which feel the heat of international criticism -- should start trying to do some damage control.

Israel’s decision to strike Gaza last winter may have been a tactical success: The rate of Hamas rocket attacks has decreased dramatically. But as Anthony Cordesman, a military analyst at the Washington-based Center for Strategic and International Studies, wrote in his report on the Gaza war last February, Israel wasn’t prepared for the war’s political consequences, particularly internationally.

Just one example: Turkey last week excluded Israel, a longtime ally, from regional military exercises because, Turkish Foreign Minister Ahmet Davutoglu has said, of its Gaza campaign.

Unlike many of its neighbors, Israel is capable of defending its own interests and investigating its own behavior. It has done it before, and it can do it again. Criticizing the Goldstone report -- its findings, its failings and its omissions -- isn’t a substitute.

(Celestine Bohlen is a Bloomberg News columnist. The opinions expressed are her own.)

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To contact the writer of this column: Celestine Bohlen in Paris at cbohlen1@bloomberg.net

Last Updated: October 26, 2009 20:00 EDT