PHOENIX — Arizona is wading into Middle East politics.
And it involves ice cream.
State Treasurer Kimberly Yee announced Tuesday she is selling off all of the state's notes it holds in loans to Unilever. That follows the announcement that the company will no longer sell its Ben & Jerry’s brand ice cream in Israeli-occupied territories, including the West Bank and contested east Jerusalem, all of which Israel claims as its capital.
Yee, in a press release, said she had no choice.
She cited a 2016 law which says that state entities are prohibited from doing business with any company that boycotts Israel. The decision not to sell ice cream in the Palestinian territories occupied by Israel triggers that law.
The move comes despite a Unilever official contacting Yee with an argument that the company is not violating the law because it is not boycotting Israel. And, in a letter to Richard Williams, head of investor relations for the company based in London, Yee said it is irrelevant that when Unilever acquired the Vermont company in 2000 it allowed it to retain an independent board and to make decisions that were not approved by the corporate parent.
“The fact remains that Ben & Jerry’s is a legal subsidiary of Unilver, and due to the decision by Ben & Jerry's, continues to be in violation of Arizona law,” Yee wrote.
Arizona's Unilever holdings in the form of bonds and commercial paper — $143 million as of the end of June — compares with about $26 billion in assets it manages. Yee said that's already been reduced to $50 million "and will be zero by Sept. 21 after our last investment in Unilver matures.''
The 2016 law is in direct response to what has become known as the BDS Movement — boycott, divest, sanction — designed to pressure Israel to withdraw from the territories it seized after the 1967 war and continue to occupy. David Gowan, then a Republican state representative from Sierra, Vista, called the BDS Movement “anti Semitic.”
“This bill is aimed at showing Arizona's supportive of Israel — its strongest ally in the Middle East,” he said at the time. “Nobody should be doing things for bigotry.”
Deputy Treasurer Mark Swenson said that his office annually reviews its holdings to ensure compliance. He said this is the first time a decision has been made to divest.
There was no immediate response from Unilever. But in an essay in July in the New York Times, Ben & Jerry's founders Bennett Cohen and Jerry Greenfield defended the move.
They said they were -- and are -- supporter of Israel, saying it was one of their first overseas markets.
“But it's possible to support Israel and oppose some of its policies, just as we've opposed policies of the U.S. government,” they wrote. And the men, who described themselves as “proud Jews,” denied the move is a contradiction or anti-Semitic.
“In fact, we believe this act can and should be seen as advancing the concepts of justice and human rights, core tenets of Judaism,” they said.
That sentiment mirrors some of the comments made when the measure cleared the Arizona Legislature in 2016, with 14 House members and six senators in opposition.
Among those voting against it was then-Sen. Steve Farley, D-Tucson, who said the legislation was built on the flawed assumption that all Israelis and all Jews support that country's current policies. But in an "active, free-market democracy,'' he said, people think different ways.
Yee, who voted for the 2016 measure when she was a state senator and is now seeking the Republican nomination for governor, declined to be interviewed.
This isn't the first foray by state lawmakers into Middle East politics.
In 2014 the House went on record as saying the entire West Bank belongs to Israel and the Jews who have settled there since the 1967 war “reside there legitimately.”
That resolution, approved without debate, says that the area, which some Israelis refer to by the biblical names of Judea and Samaria, was granted to Israel “through the oldest recorded deed, as recorded in the Old Testament.” It also says the “claim and presence” of Jewish people in Israel, including the West Bank, has “remained constant throughout the past 4,000 years of history.”
In 2019, fixing a legal flaw in another provision in the 2016 law, the legislature voted to deny public contracts to firms that refuse to do business with other companies that do business in Israel.
That move came over the objections of Rep. Athena Salman, D-Tempe, who told colleagues of how her family members, some here now, some still living in occupied territories, have been treated. She said the BDS movement is designed to pressure Israel to end what she said are “Israeli human rights abuses” and illegal settlements on the West Bank.
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