President Donald Trump’s decision last week to defund the UN Refugee Works Agency for Palestine (UNRWA) may not seems as significant as recognizing that Jerusalem is Israel’s capital and transferring the U.S. embassy from Tel Aviv to Jerusalem. But it is.

Both actions involve rejecting myths embedded in the failed peace process between Israel and the Palestine Liberation Organization (PLO). Both actions ground U.S. Middle East policy in reality. And consequently, both actions clear a path for a more stable future for all actors in the Middle East and for the U.S. in its relations with the states and peoples of the region.

On September 13, we will mark the 25th anniversary of the peace process between Israel and the PLO. The process, which was supposed to take five years to complete, was based on the idea that peace would be built on incremental moves that would gradually enmesh the two sides in a virtuous cycle of peace. The peace process is popularly dubbed “the Oslo process” because it was initiated through a series of secret negotiations between Israeli and PLO officials in Oslo, Norway.

In the first stages, Israel was supposed to transfer land to the PLO in Gaza, as well as Judea and Samaria (the West Bank), for the Palestinians to manage as an autonomous proto-state. To that end, Israel was expected to legitimize the PLO, an international terror group, funding its operations and lobbying foreign governments to underwrite the PLO-run autonomy, known as the Palestinian Authority (PA).

For its part, the PLO was supposed to use the land, governing power, funding, and international recognition it received to build the foundations of a functioning Palestinian state. It was supposed to cultivate Palestinian society as a free people at peace with Israel.

The Oslo process’s gradualist approach assumed that the intractable differences at the foundation of the conflict — first and foremost, Jerusalem, and the so-called “Palestinian refugees” that UNRWA is responsible for — could be left until the end of the process. The idea was that after five years, (or 25 years, as the case may be) of building peaceful relations, the disputes that were irreconcilable at the outset of the process would suddenly seem unimportant. Indeed, they would solve themselves.

Israel, for its part, did what it agreed to do. It transferred almost the entire Gaza Strip and all the Palestinian population centers in Judea and Samaria to the PLO within two years. By 1997, 98 percent of Palestinians in Judea, Samaria, and Gaza – including so-called refugees living in UNRWA camps – were living under Palestinian control and jurisdiction.

Israel collected taxes for the Palestinian Authority and forgave its debts, including hundreds of millions of shekels in unpaid medical bills for Palestinian patients that Israel cared for in its hospitals.

Israel lobbied foreign governments to underwrite the PA budget. It appealed to the U.S. Congress to turn a blind eye to PLO terrorism and fund the PA. It gave arms to PLO security forces and encouraged the U.S. and the EU to train PLO forces later deployed to the areas under PA control.

For its part, rather than build the foundations of a state, the PLO used all the resources Israel, the U.S., the EU, and the rest of the international community placed at its disposal to build a terror state. Rather than teach Palestinian children to build their future in freedom with Israelis, the PLO indoctrinated its children to work towards Israel’s annihilation. The Palestinian economy, which had grown every year since 1967, suddenly began to contract. Unemployment levels skyrocketed. Large swathes of donor-funded budgets were siphoned off to the personal bank accounts of top PLO officials. As for its newfound legitimacy in international forums, the PLO used its power to delegitimize Israel’s right to exist.

So far from solving themselves, by 1998 (and by 2016) those same issues that were supposed to be negotiated in the final stages of the peace process were more intractable than ever. The PLO and its erstwhile partners in Hamas used Jerusalem as a rallying call for jihad aimed at Israel’s destruction. They used the so-called refugees that UNRWA has cultivated as an argument for their refusal to accept Israel, and their dedication to its annihilation.

The Palestinians’ behavior showed that the architects of the 1993 peace process had it backwards. For any peace process to have had a chance of success, the issues of Jerusalem and the so-called refugees had to be settled at the outset. By leaving them to fester, the peace processors legitimized the PLO position that Israel has no right to exist. In that way, the architects of the peace process paved the way for the PLO to build its kleptocratic terror state and wage its ever-escalating political war to delegitimize Israel’s right to exist.

After all, Jerusalem has been Israel’s capital for three thousand years. The Jewish people’s attachment to Jerusalem forms the basis of Jewish national identity and faith. Non-recognition of Jerusalem as Israel’s capital involves not recognizing the Jewish people’s existence. This, in turn, necessarily engenders rejection of the right of the Jewish state to exist.

By the same token, UNRWA was founded in 1949 after the infant state of Israel beat back five invading Arab armies. UNRWA’s purpose was officially to care for the Arab refugees who left Israel during the war.

But its actual goal was to reverse the outcome of the war. Whereas the UN High Commissioner for Refugees is tasked with permanently resettling refugees, UNRWA was tasked with perpetuating the refugee status of the Arabs who left Israel in 1948-1948. Not only were the Arabs not given permanent homes, but those who found permanent homes and were naturalized in other countries still remain on UNRWA’s refugee rolls to this day — and so do their descendants.

This is the case because UNRWA automatically registers all descendants of these Arabs as refugees. UNRWA has exploited its perpetual mandate to inculcate its “refugees” with a national identity based entirely on rejecting Israel and seeking its annihilation. Not surprisingly, and largely as a consequence of this basic fact, UNRWA’s installations are operated by Palestinians who reject Israel’s right to exist and devote their lives — whether through indoctrination or direct involved in terrorism — to its destruction.

As the Middle East Forum has demonstrated, while UNRWA claims that from the half million Arabs who left Israel in 1948-1949, there are today 5.5 million Palestinian “refugees,” there are a mere 20,000 individuals who left Israel during the pan-Arab invasion who have yet to be given a permanent home. The rest of the people on UNRWA’s rolls are at best, welfare recipients.

It ought to go without saying that an agency that exists to perpetuate the Arab war against Israel cannot peacefully coexist with Israel. And yet, operating in accordance with the 1993 peace process’s principle of gradualism, the Clinton, Bush, and Obama administrations spent the past quarter century expanding U.S. support for UNRWA.

Likewise, in the interest of advancing the so-called peace process, all three administrations refused to enforce the 1996 Jerusalem Embassy Act that required them to move the U.S. embassy in Israel to Jerusalem.

In acting as they did, those administrations did not facilitate peace: rather, they made it impossible. They gave the Palestinians hope that they will one day achieve their goal of destroying Israel because these actions signaled that the U.S. did not fully accept the Jewish people’s right to self-determination.

By refusing to acknowledge that Jerusalem is Israel’s capital, and by refusing to openly state and act on the fact that there are not 5.5 million Palestinians refugees who have a right to overrun Israel in a mythological “right of return,” Washington gave the Palestinians reason to believe that one day the U.S. would one day abandon Israel entirely.

Trump’s recognition of Jerusalem and his defunding of UNRWA remove all doubt about America’s recognition of Israel.

Unsurprisingly, Trump’s moves have made upset the Palestinians. PLO chief and PA chairman Mahmoud Abbas and his cronies insist that the U.S. has no right to end its welfare payments to pretend refugees.

They can be excused for being indignant.

After all, for 70 years, the U.S. refused to recognize reality on either Jerusalem or UNRWA. For 25 years, three administrations ignored PLO support for terrorism, political warfare against Israel, corruption, and embezzlement. And now, suddenly, Trump and his team are paying attention and basing U.S. policies on reality.

The Palestinians are not alone in their indignation. Over the past 25 years, as the fundamental lies at the heart of the failed peace process continued to inform the policies of successive U.S. administrations, the gamble of the peace process became the religion of the peace process. Israeli leftists, like European and American leftists, embraced the PLO’s anti-Israel narrative as an article of faith. It is all but impossible for them to walk away from it after all of these years.

Moreover, the peace process’s false assumptions didn’t perpetuate themselves. Over 25 years bureaucracies were spawned in Israel and across the world on the basis of the failed peace process and its false belief that, once empowered, terrorists become model citizens and pioneers. Trump’s moves expose these bureaucracies’ incompetence, strategic blindness, and corruption.

And just as Trump’s determination to ground U.S. policy in reality harms those dedicated to perpetuating fantasies, it empowers millions of people who have been marginalized and silenced for a quarter century. It gives them – Israelis, Palestinians Arabs, and Arabs in the wider Middle East – the possibility for the first time to build relations based on reality.

That may not lead to fancy signing ceremonies with doves and balloons on the White House lawn. But it does provide the first realistic basis for honest and cooperative relations between Israel and its neighbors since 1993.

Caroline Glick is a world-renowned journalist and commentator on the Middle East and U.S. foreign policy, and the author of The Israeli Solution: A One-State Plan for Peace in the Middle East. Read more at www.CarolineGlick.com.