Bemidbar 32:1 records that the tribes of Gad and Reuven had a large amount of domesticated animals, mikneh, see Shemot 9:6. Does this verse mean that they had more animals than the other tribes or that all the tribes had a lot of animals but this fact is recorded in reference to the tribes of Gad and Reuven since it was the basis for their request for land on the east bank of the Jordan River? With the former possibility, it is unclear why they should have had more animals. Could it be that that since they camped in the south, they had more opportunities to trade with Moav which enabled them to acquire more animals than the other tribes? With the latter possibility, it is curious why they asked to remain on the eastern side, and various reasons relating to their status have been suggested, see Mordechai Breuer (1993, p.266-298), Nathaniel Helfgot (1998) and Lawrence Kaplan (1999).
32:2-5 records that the tribes of Gad and Reuven requested land on the east bank of the Jordan River (present day Jordan) because they claimed it was good land for their mikneh. Breuer (1993) and Helfgot (1998) note that this request was similar to the actions of Lot and Esav, Bereshit 13:10-13, 36:6, that all left the land of Israel due to their mikneh. Moshe was very unhappy with this request, 32:5-15, which led the tribes of Reuven and Gad to make a counteroffer, 32:16-19, which Moshe accepted, 32:20-24, and the book of Yehoshua, 22:1-4, records that they carried out their part of the bargain. Thus, in the end, the tribes received the land on the eastern side of the Jordan River, but they remained part of the covenant (see Devarim 27:13) unlike Lot and Esav who by leaving the land of Israel left the covenant of Avraham. Why did Moshe change his mind? Why were the tribes of Gad and Reuven allowed to settle on the eastern side of the Jordan River?
The simplest understanding of the discussion between Moshe and the tribes of Reuven and Gad is that Moshe thought that the tribes did not want to go fight. (Jacobson, 1986, p.176 quotes this idea from Josephus, see also Rashi on 32:7, Bekhor Shor on 32:14 and Ramban on 32:2) This was troubling for two reasons. One, this was morally wrong, that only some of the tribes should fight as Moshe said, (32:6) “Should your brothers go to war, and you stay here?” Two, Moshe (33:7) compared their actions to the spies, that their act of cowardice could inspire other tribes to act similarly that nobody would want to go fight for the land of Israel. Accordingly, the tribes of Reuven and Gad answered that they would lead the fight for the land, 32:17, so instead of being considered as cowards they would take upon themselves the brunt of the fighting.
While this explanation sounds reasonable, I doubt that the people would have been scared to go to the land of Israel because of the actions of the tribes of Reuven and Gad since the people had just decisively defeated Sihon, Og and Midyan. N. Leibowitz (1982, pp.379-387) notes that the crucial issue here is the mikneh and not a fear of fighting in the land of Canaan. Did the tribes just mention their mikneh as a cover for their fear of fighting? Why did the Torah begin the episode by noting the tribes had lots of animals if this issue was not important? Finally, why should the tribes end up getting land outside of the land of Israel just because they were willing to be the lead troops?
The fundamental issue is what was the status of the land on the east side of the Jordan River? The land appears to be part of the promise land to Avraham in the covenant in Bereshit 15:18-21. Yet, based on the boundaries of the land of Israel, as delineated in Bereshit 10:19,20, it is outside the land of Israel. Thus, Moshe was on the east bank, but yet he never made it to the land of Israel, Bemidbar 20:12.
I believe the standard understanding is that the land on the east side of the Jordan River was considered a second stage to the land on the western side of the river, which was the land of Israel proper. This understanding raises the question what was to become of the land that the Jewish people had captured from Sihon and Og. The land was not to be abandoned since it was to be part of the land of Israel, but who was going to get the land? Ramban (on 21:21) writes that if the tribes of Reuven and Gad had not requested the land, it would have remained empty (a national park?) but this is difficult since surely other nations would have tried to settle there. Netziv (on 32:5) explains that the land on the east bank was supposed to be divided equally in 12 tribes. This is also difficult because then almost all the tribes would lack territorial contiguity between their land on the east bank with their land on the west side of the Jordan.
Thus, it must be that the land on the east bank of the Jordan River was supposed to go to some tribe(s), and realizing this, the tribes of Gad and Reuven requested this land. Maybe they did not initially offer to be the lead troops since they thought that their offer was beneficial to the other tribes who would now have more land in the land of Israel proper. Furthermore, I do not think that the tribes asked for land that they thought was not part of the promise land. Most likely, they thought that it was possible to receive the land before the people entered the land of Israel since once G-d had helped the people conquer Sihon and Og, then the conquered land was already to be considered part of the promise land. Thus, in 32:4 they refer to the land as the land that G-d had delivered to the people. (Meir Horden also suggested to me that since the Amorites, Sihon and Og, were considered as Canaanites, then this also would be a reason why they thought the land on the east bank was already part of the promise land.)
Moshe was upset with their request for two reasons. One, he thought it was morally wrong for them not to fight when everybody else had to fight, 32:6, and two he was worried that just as they wanted to stay on the east bank because they thought it was good land so too the others tribes would also want to stay on the east bank for economic reasons, 32:7-15. It is not that the rest of the nation would have been scared of fighting, but if they agreed with the tribes of Gad and Reuven that the land on the eastern side was better land, then they would not want to cross over the Jordan River.
Furthermore, I think that Moshe also rejected their claim that the land on the eastern side was already to be considered as part of the promise land. Instead, first the land on the western side had to be acquired and only afterwards would the holiness spread to the eastern side. Thus, Moshe ended his retort by stating that if the people turned away from G-d, then they would be left in the desert, 32:15, since the eastern side of the Jordan was not yet considered as part of the land of Israel.
The tribes of Gad and Reuven had two responses for Moshe's two arguments. One, they would not shirk their duty to fight, but they would fight on the frontlines, 32:17. This more dangerous fighting would be their way of "paying" for the right to choose their land. Two, they would remain on the western side until all the people received their inheritance, 32:18. This second response shows that they understood that the land on the eastern side was not yet part of the promise land since the land on the western side had to be settled first. Moshe accepted their offer, and stated that after the land on the western side was captured, then the tribes would receive the land as an ahuzzah, 32:22. (It is not clear if Moshe thought that they just had to wait until the land on the western side was captured, 32:22 or that they had to wait until the land was parceled out as they had offered, 32:24, see Rashi on 32:24.)