In his book The Varieties of Religious Experience: A Study in Human Nature, William James, the greatest American philosopher and leading thinker of the late nineteenth century suggests that something is true only insofar as it works. In light of the radical change in the Jewish condition brought on by the creation of the Jewish state on May 14, 1948, does Christian and Muslim doctrine regarding Jews still “work?” What theological challenge does the juxtaposition of “Jewish” with “state” pose to Christian and Muslim traditions and how does each respond to the new Jewish reality?
A fundamental premise of early Christian tradition was that the destruction of the Jewish Temple in Jerusalem in 70 CE, loss of Jewish political sovereignty and the exilic status of the Jews were all the corollary of divine punishment for their rejection of Jesus as the Christ.
Furthermore, the debasement of the Jews in the world, in contrast to the rise and success of Christianity, is seen as divine testimony that Christianity replaced Judaism. It is also proof that Christianity is the new rightful heir to the title “verus Israel” (true Israel). Therefore, the creation of a Jewish state in Israel with Jerusalem as its capital abruptly challenged the inner coherence of fundamental Christian thinking via-à-vis the Jews.
The response of the Catholic Church to this theological challenge was to suggest that the creation of Israel did not come about through divine providence. Instead, the occurrence is considered a strictly secular historical event. Likewise, it does not invalidate the Christian claim that Christianity has replaced Judaism.
Protestants are among the most ardent supporters of Israel today. Protestant doctrine, unlike Catholicism, sees this world as temporal. The return of the Jews to their homeland and the creation of a Jewish state in Israel is seen very much as a theological phenomenon that will help usher in the Second Coming of Jesus. Thereafter, Jews will embrace Jesus as the Christ, which will bring about the kingdom of heaven on earth.
Determining the impact that the creation of Israel has on the Islamic tradition is a complex undertaking. Islam’s attitude toward Jews is marked by great polarity. While some Islamic sources look favourably upon Jews others are cited by more radical elements to justify hostility toward them.
For a small number of Muslims, the way to reconcile the creation of Israel is to render the Quran as a pro-Zionist document. For this group, the existence of a Jewish state in Israel is supported by sura 5 verse 20-21: “…Moses said to his people, O my people, remember the favour of Allah upon you when He appointed among you prophets and made you possessors and gave you that which He had not given anyone among the worlds. O my people, enter the Holy Land which Allah has assigned to you and do not turn back…” For Muslims who embrace this notion, there is no theological disparity between their faith and the establishment of Israel.
On the other hand, one Islamic institution that continues to be used by radical elements sees the world divided into two camps: Dar Al-Harb – territory not yet under Islamic rule – and Dar Al-Islam – territory where Islamic shari’a law exists. Once under Islamic rule, land remains a part of Dar Al-Islam until “Judgement Day.” Since Palestine was once under Muslim rule (634-1099 CE) it can never be relinquished.
The creation of Israel poses a theological dilemma for Muslims who view the world through this prism. For them, accepting a Jewish state in “occupied Palestine” is tantamount to overturning this institution and accepting the subjugation of “Muslim territory” to Jewish dominion.
Even though theological considerations may prevent more radical elements in the Muslim world from accepting a Jewish state in Israel, there is a growing tendency by Muslim moderates to favour diplomatic relations with Israel.
Aside from the obvious examples of Jordan and Egypt, Israel shares open and secret diplomatic relations with many Muslim states. Israeli Foreign Minister Avigdor Lieberman made the following statement which suggests a general shift from a theologically oriented policy toward Israel to a moderate pragmatic policy: “I’m certain that by then  we will have a situation in which we have full diplomatic relations with most of the moderate Arab states. And you can count on my word.”
Though mainstream Christianity currently has accepted the state of Israel, much of the Muslim world remains theologically opposed to it. Currently, moderate tendencies have moved many Muslim states cooperate with Israel, while more radical elements have yet to reconcile the existence of a Jewish state.