The truth is that along with realization of a dream of "joining Europe," membership in the EU could also incur what Israel might consider a very steep price. Israel would have to nullify the Law of Return - EU legislation stipulates that all citizens living within its boundaries are free to settle and work without restriction in all of its member states - and all of the laws that discriminate favorably toward Jews. Israel would be required to unilaterally adopt all sections of the European legislation, and the European Convention of Human Rights. In so doing, it would all at once become a "state of all its citizens."
Israel would also be required to make a series of structural changes to its economy, to comply with the rigid criteria of the Maastricht Treaty. Joining the European Monetary Union - another prerequisite for joining the EU - would place it in a pillory of fiscal and monetary constraints over which it has nearly no control or maneuverability, such as the determination of interest rates (an authority now given to the European Central Bank). Additionally, Israel would be required to make harsh concessions in its defense and trade agreements with the U.S.
which already make it seem less than likely that the idea will ever wash. Israel is the only country in the world more concerned with its sovereignity than the United States, and joining the EU seems to carry with it commitments that Israel is ideologically incapable of making. But the ultimate reason that Israel seems a poor match has more to do with the basic concept of what the EU is and the basic concept of what Israel is. As the Ha'aretz article succinctly puts it:
The September 11 terrorist attacks reignited the argument over whether the EU is a members-only club of Christian countries that provides a barricade to the spread of Islam, or a supra-national framework that sanctifies freedom and rights of the individual. Israel does not naturally conform with either of these models.
However, I think the idea of Israel in the EU is not any more bizarre than the fact that Britain already IS a member. There's a compelling argument that the UK should not be in the EU - in fact, a far more compelling case can be made for the UK joining NAFTA :
First, the U.S. is already deeply enmeshed commercially with Britain; further trade liberalization would result in immediate and significant benefits for the American economy. Over the last 10 years UK net direct investment in North America has been greater than double its investment in the EU. Direct net investment in the UK from the U.S. and Canada has been 1.5 times the figure of total EU investment in Britain. In 1997 British direct investment in the U.S. was $18.3 billion, greater than any other country's, and 30 percent of the total of all foreign direct investment in the U.S. America invested more in Britain than anywhere else--$22.4 billion, or 20 percent of the total of all U.S. foreign direct investment. Also, Sterling has tended to be more in line with the dollar than with the D-mark and the other European currencies. This greatly affects interest-rate harmonization, leading to the inescapable conclusion that the American and British economies are more in-sync with one another than either is with the economic powers on the Continent.
There is also a much more comprehensive analysis of the same issue at the Action Centre for Europe website, in an exhaustive piece titled, "Fog over the Atlantic: Britain and the NAFTA Option" (with a Foreword written by John Major). And in fact Britain may well repudiating its membership by letting its membership lapse (I recall seeing a story about this but can't find the link).
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