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The 1967 War gave Israel undisputed control over all land within the boundaries of pre-1948 British Mandatory Palestine and over a large segment of the Palestinian people. Israel was in an ideal position to implement the very same solution to the Palestine problem that the UN had mandated and that Israel had embraced only twenty years earlier, in 1947--a division of the land between the two peoples. Instead, Israel opted to take advantage of the new circumstances in order to become the main arbiter within the territory of pre-1948 Palestine which meant in practice also being the main arbiter of the fate of the Palestinian people.

It is only fair to say, of course, that in 1967 there was no cohesive Palestinian side ready to take command and ready to sign an agreement with Israel. In fact, there was no established Palestinian sovereign body, the Palestinians having been under Ottoman rule up to 1918, then under British mandatory rule, and after 1948, under Jordanian and Egyptian rule (the West Bank and the Gaza Strip, respectively). And the Palestine Liberation Organization, which in time would become he recognized leader of the Palestinian national movement, was still in its infancy. Still, Israel could have returned the newly acquired territories to Jordan (the West Bank) and Egypt (The Gaza Strip). Alternatively, it could have held them in trust until a fair arrangement could be negotiated with the Palestinians.

Instead, Israel proceeded to detach the West Bank from Jordan, and the Gaza Strip from Egypt, and to submit the Palestinians to control mechanisms that would allow it to make sure that any future Palestinian state or autonomous region would not threaten Israel's supremacy in the area lying between the Mediterranean and the Jordan River. To generals like Moshe Dayan and Yigal Alon, who had been senior commanders in the I.D.F. in the war of 1948, and who by 1967 had become senior political leaders, the result of the Six Day War represented due rectification of what they considered the major strategic mistake made by David Ben Gurion. Back in 1948, Ben Gurion had decided to honor his secret understanding with Jordan's King Abdullah, whereby the areas that later become known as the West Bank would go to Jordan (Shlaim, 1988).

Israeli policy concerning the Palestinian territories conquered in 1967 has often been characterized as "perplexed" or "indecisive" (Pedatzur, 1996); thus the new Israeli dominion has been tagged "The Accidental Empire" (Gorenberg, 2006). However, as political scientists learned long ago, in politics, a non-decision is also a decision (Bachrach & Baratz, 1963). In this case, decisions were made that slowly but systematically eroded the status of the Palestinian territories as "administered" territories: East Jerusalem was annexed to Israel as early as June 11, 1967; the Jordan River was declared "Israel's security border"; the Alon Plan pinpointed strategic areas for the establishment of Israeli settlements; the pre-1948 Jewish settlements of the Gush Etzion area were resettled; a new road from Tel Aviv to Jerusalem was paved, encroaching upon the Latrun enclave; beginning in 1977, settlements were set up in the heart of Palestinian-populated areas; and soon afterwards a campaign was mounted to declare large sections of "Judea and Samaria"--formerly the West Bank - "state lands," thus legitimizing Jewish settlement on them.

The first Intifada was the first massive challenge thrown up by the Palestinians to Israeli control. Eventually it led to the convening of the 1991 Madrid conference, and later on to the signing of the 1993 Oslo accords. Yet the Oslo accords and the establishment of the autonomous Palestinian Authority did not change the pattern of control: Israeli governments used the transition period between Oslo and the final status negotiations to hastily expand existing settlements, resulting in a doubling of their populations; to pave bypass roads that bisected areas due to be transferred to Palestinian control; to erect hundreds of road barriers; and to deploy I.D.F. troops within those parts of the Palestinian territories that both sides had agreed would remain under full Israeli control during the transition period (Areas C) (Rabinowitz, Haaretz, April 16, 2004).

The first edition of The Cost of Occupation was published in 2004, at a time when Israel was still licking the wounds of the second Intifada, the Al-Aqsa Intifada. That Intifada, which had broken out in September 2000, brought on the most violent confrontation between Palestinians and Israelis seen since 1948. More than 2000 Palestinians and more than 550 Israelis were killed, and many thousands were injured. The Intifada put a stop, if not an end, to the Oslo accords reached in 1993 between Israeli and Palestinian representatives: Israeli forces now reoccupied all of the West Bank, including those areas that had been assigned in 1993 to the full responsibility of the Palestinian Authority; Israeli forces also destroyed much of the Palestinian security infrastructure. Israel proceeded to implement a series of unilateral moves, foremost among them the construction, beginning in 2002, of a wall around the West Bank, which involves the de facto annexation of large tracts of Palestinian lands to Israel, and the 2005 disengagement from the Gaza Strip. The Palestinian Authority, whose power rested on the cadres of the Palestine Liberation Organization, lost during the Intifada both face and clout. Its main political opposition, the Hamas, had carried out some of the bloodiest suicide attacks inside Israel, while at the same time developing a network of social assistance. In the elections to the Palestinian parliament held in January 2006, Hamas displaced the PLO as the largest party and formed a new cabinet. In June 2007, following a forceful Hamas takeover of the Gaza Strip, Palestinian President Abu Mazen disbanded the Hamas-led cabinet, a move that resulted in a new political map; PLO cadres now rule over the West Bank, while Hamas rules over the Gaza Strip.

The prolonged occupation and confrontation has been extremely damaging to both sides, but especially to the Palestinians: they have failed to create stable institutions and to promote economic development; their daily sustenance is dependent upon the good will of donors; they are exposed to violent death, injury, imprisonment and deportation, as well as to land confiscation and property damage; many are prevented from studying; they suffer from high unemployment, broad-ranging poverty, food insecurity and daily humiliations in their homes and streets and at road barriers.

As for Israel, since it is the dominant side whose state institutions, army and economy are stronger, the general impression is that not only does Israel have nothing to lose from the situation but that it actually benefits from it.

However, the truth is that the conflict with the Palestinians is like a millstone around the neck of Israel: it undermines economic growth, burdens the budget, limits social development, sullies its vision, hangs heavy on its conscience, harms its international standing, exhausts its army, divides it politically, and threatens the future of its existence as a Jewish nation-state. It also kills and injures thousands of Israelis. In short, Israel is paying a heavy price for the continuation of the conflict and for the absence of a fair and agreed-upon partition.

This report aims to present the social, economic, military and political price that Israel has been paying for its continuing occupation of Palestinian territories.

Many Israelis have difficulty thinking in terms of cost; in other words, in terms of a policy that has alternatives. The majority of Israelis were born or arrived in Israel after 1967. The Green Line holds little meaning for them; they are accustomed to viewing the opposition of the Palestinians as an expression of blind hostility, rather than as an expression of the desire to end the occupation and live in an independent state.

Moreover, there are Israelis for whom the occupation does not exact any personal cost but rather constitutes a definite benefit, even though the benefit may not be direct. Examples: Israelis who purchased homes at bargain prices in neighborhoods and settlements built on Palestinian lands; industrial entrepreneurs and workers in plants that export to the occupied territories without paying customs duties and without having to incur heavy transport costs; land-owners, garage owners, building contractors and others who employ Palestinian workers for low wages.

Even when it is clear that costs are involved, it is not always easy to discern them, especially in cases in which the cost is not personal but macro-economic or macro-social.

But above and beyond all that, it appears that Israelis live in a state of denial--of both the fact of occupation and their control over the fate of an entire people--and of the cost of occupation to Israeli morality, society, economy, and polity. The idea that Israeli policy regarding the Palestinian territory and people may not only be morally wrong but is also economically and socially self-harming is not openly voiced and discussed in Israel. The dominant narrative is one that sidelines the reality of occupation and falls back on the more than century-old Palestinian and Arab opposition to the Zionist project; that is, it is a narrative in which Palestinians are the aggressors and Israelis the victims.

Moreover, public attention, within Israel no less that outside it has over the years focused mainly on the military, political and humanitarian aspects of the Israeli-Palestinian confrontation. In contrast, the social and economic consequences of the conflict are less well known. Any attention given to these aspects is generally limited to the Palestinian side, justifiably, given the fact that the Palestinians are the people living under occupation and given the fact that the occupation is largely responsible for the low level of economic development that has continued to characterize the Palestinian territories.

What is less well known is that Israel itself has been paying a heavy price for the continuing occupation, especially since the outbreak of the first Intifada in 1987. The fact that this is not known outside of Israel is not surprising; what is more surprising is that the social and economic costs of the occupation are not a regular feature of the political debate and media discourse within Israel. The political right views the conflict as a "a fight against terror" and thus tends to stress the need to remain "a nation under arms." To them, the burden is mainly one of military and human sacrifice. The political left views the conflict as a confrontation between conqueror and conquered and thus tends to stress the burden of being morally wrong and politically unwise. Neither side tends to acknowledge that for Israel, the continuing conflict has become a heavy social and economic burden.

The burden became abundantly clear during the Al Aqsa Intifada, following which Israel experienced two years of economic contraction and three years GDP loss per capita. That contraction had wide-ranging consequences, foremost among them large budget cuts, the impact of which is felt throughout Israeli society to this very day. The combination of economic slow-down and unprecedented budgetary cuts produced a steep rise in unemployment and poverty as well as a crisis in social services outlays, which hit the middle class especially hard.

It was only in the aftermath of the second Intifada that Israeli leaders began to acknowledge that continued control over the Palestinians, far from constituting a major strategic advantage, may in fact be a major strategic folly. Prime Minister Olmert put it in a straightforward way: unless a Palestinian state is created within the foreseeable future, Israel faces the danger of Palestinians demanding a bi-national state. A bi-national state with a one-man one-vote system would mean not only the end of Israeli control of the Palestinian territories but also of the entire area of Israel/Palestine, that is, present-day Israel. Such a state, declared Olmert, would mean "the end of Israel" (Ynet, December 3, 2007)--meaning the end of Israel as a state of Jews and for Jews.

The military suppression of the second Intifada brought about a prolonged period of calm on the Israeli side of the Green Line. That calm, plus the growth in world trade, allowed the resumption of economic growth. In the four years 2004-2007, the Israeli economy grew at an average annual rate of slightly over 5%. The Israeli elite was euphoric: towards the end of 2006, Prime Minister Ehud Olmert declared that "the economic situation is better than it ever was ... the dream of the State of Israel has come true" (The Marker, 12.12.2006). On January 1, 2008, the economic supplement of Haaretz, The Marker, called 2007 "one of the best years ever" (Bassok, 1.1. 2008).

The lesson of this cycle of growth is complex, though: on the one hand, it highlights the advantages of calm, and the extent of the possible gains that Israel--and the Palestinians--can derive from the achievement of a political settlement between the two sides. On the other hand, when viewed in the context of the nation's sharp economic fluctuations over the last two decades, the present cycle of growth can also be seen as a respite between Intifadas. At a time like this, it should be remembered that without a political solution that allows the Palestinians an honorable, independent existence as well as an opportunity for independent economic development, Israel is liable to be called upon--time and time again--to pay the price it paid following the first and second Intifadas.

It is the purpose of this report to show the burden to Israel of the continuing conflict with the Palestinians. The Palestinians, of course, are paying a much heavier social and economic price. However, this fact in no way diminishes the exorbitant cost to Israel--the focus of this report.

The Burden of Occupation is divided into two parts. Part One deals with the period from 1967 to 1987, the first two decades of the occupation, during which the cost to Israel was relatively low and was balanced, to some degree, by the benefits that accrued to Israel from the occupation. Part Two begins with the 1987 Palestinian uprising. Since then, and particularly during the second Intifada, (2000), the cost of occupation has risen dramatically, while the benefits have been diminishing.
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Title Annotation:The Burden of Occupation: The Cost of the Occupation to Israeli Society, Polity and Economy
Author:Swirski, Shlomo
Publication:Budget Reports
Article Type:Work overview
Geographic Code:7ISRA
Date:Nov 1, 2008
Previous Article:The economic crisis presents Israel with an opportunity to make needed changes.
Next Article:Chapter one: low cost of administration, low cost of defense.

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