This article is part one of a two part series. The second part was published on November 3, 2023.

Aerial footage from social media shows the unprecedented scale of the devastation wrought by Israel’s carpet bombing of Gaza. Entire neighbourhoods have been obliterated. More than a million people have been forced from their homes. Israel’s sealing of Gaza’s borders and cutting off the supply of food, fuel, electricity and even drinking water has caused unimaginable suffering.

The daily death toll is horrific.

With its targeting of hospitals, schools and other places of refuge, it is ever more apparent that Israel’s twin policies of carpet bombing and deprivation of all means of existence are aimed at driving the Palestinians out of Gaza and ensuring they never return. This is a pre-planned policy that Israel has for years sought to achieve via the forcible displacement of Gaza’s population into Egypt’s Sinai desert, as leaked documents written by Israel’s Ministry of Intelligence and interviews in the Israeli press have revealed. On Sunday, the Hebrew-language publication Mekomit reported, “the document recommends the forced transfer of the population of the Gaza Strip to Sinai permanently, and calls for the international community to be harnessed for the move.”

With the Palestinians in Israel and the occupied Palestinian territories now slightly outnumbering Jews, Prime Minister Benjamin Netanyahu and his fascist government view a war and ethnic cleansing as the only solution to the “demographic problem.” Addressing the nation, he pledged that Israel’s response to the Palestinians’ October 7 attack on Israel would “change the Middle East” and that “What we will do to our enemies in the coming days will reverberate with them for generations.”

This genocidal war against civilians in Gaza is an escalation of policies pursued by the Israeli bourgeoisie for decades, aimed at dispossessing the Palestinian people of their lands, property and homes, about which the ruling elite assumes a collective historical amnesia.

Since capturing the West Bank and Gaza in 1967, Israel’s policies towards the Palestinians, including military and political repression, have become ever tighter. Gaza has suffered 16 years of a suffocating blockade by Israel, the Palestinian Authority (PA) and Egypt that the United Nations had in 2012 predicted would make the besieged enclave uninhabitable by 2020, only to warn in 2017 that this was happening faster than it had predicted.

These events flow inexorably from Israel’s establishment as the answer to the problem of the European persecution of the Jews—where they would find a safe haven, social justice and equality. The state was in reality based upon the dispossession of another people and maintained through escalating wars, territorial expansion and repression, alongside social inequality at home.

Precipitating a war with its Arab neighbours that lasted until 1949, Israel was established in 1948 on 80 percent of the land controlled by the British under the League of Nations-granted Mandate, with King Abdullah of Transjordan, Britain's client state, seizing the West Bank and Egypt the Gaza Strip. This was less than any of the various Zionist factions wanted. But Israel’s first prime minister, David Ben Gurion, took a pragmatic approach: first establish a Jewish state and change the boundaries later.

The 1967 war and the plundering of Israel’s new Palestinian colonies

The 1967 War provided Israel with the opportunity to change the boundaries, denying its seizure of the West Bank and Gaza constituted an “occupation” of foreign territories since they had been part of Palestine, not Jordan and Egypt.

In June 1967, after a period of escalating conflict with Syria, Israel seized the opportunity presented by Egyptian President Gamal Abdul Nasser’s grandstanding as the leader of the Arab nation to launch a pre-emptive but long-planned strike against its Arab neighbours, aimed at “improving” and enlarging Israel’s 1949 borders. It seized Syria’s Golan Heights, the Jordanian-controlled West Bank and East Jerusalem, which it immediately annexed, and Egypt’s Sinai Peninsula, as well as the Egyptian-controlled Gaza Strip.

While Israel gave back Egypt’s Sinai after signing the Camp David Accords in 1979 with Nasser’s successor Anwar Sadat, and part of Syria’s Golan after the 1973 war, it retained most of the Golan, the West Bank and Gaza—home to around 1.4 million Palestinians, many refugees, having fled or been driven from their homes in what became Israel in 1948.

Israel moved swiftly—with some measures taken even before the six-day war ended—to incorporate its newly conquered territories into its economy. In effect, the Palestinian territories were to constitute a latter-day colony—even after the European powers had been forced to grant formal independence to their colonies in Africa and Asia—with a devastating impact on every aspect of Palestinian life, while benefiting Israel’s commercial elite.

Israel’s Labor government under Levi Eshkol imposed military rule to defend its colonisation policy on the ground and to subjugate the Palestinians. The Palestinians were required to carry identity cards and were subject to restrictions on their freedom of movement with curfews and roadblocks. Resistance was met with collective punishment, house demolitions, forced deportations and detentions without trial.

Israel took control of the financial and monetary institutions, obliging those seeking start-up loans to comply with Israeli regulations and making it virtually impossible for the Palestinians to industrialise and compete with Israeli firms. It replaced the Jordanian, Egyptian and Syrian currencies with its own and tightly controlled Palestinian trade.

By 1983, Israel had expropriated over 52 percent of the West Bank, most of its prime agricultural land. On the eve of the 1993 Oslo Accords, these confiscations covered more than three-quarters of the territory. During the first 10 years of the occupation, when the Labor Party held power, the first settlements were built around the Palestinian population of East Jerusalem and in the Jordan Valley to block the expansion of the city’s Palestinian neighbourhoods and “encourage” them to leave. By 1977, there were 4,500 Israelis living in the West Bank and 50,000 in East Jerusalem.

The election of a Likud government headed by Menachem Begin in May 1977 turned settlement building into an ethno-religious project. The settlements were built with a raft of financial incentives in the biblical heartland of the West Bank adjacent to major Palestinian towns and cities. By 1983, the number of settlers in the West Bank had risen to 28,400.

Restrictions on building and infrastructure development and access to aquifers blocked development, including of agriculture on which very many Palestinians depended, and forced them off the land, only for the authorities to confiscate land left uncultivated. Its former occupants were forced to seek work in Israel, particularly in construction and agriculture, where they formed a cheap labour pool for Israeli employers.

By 1974, one third of the Palestinian workforce was employed in Israel, and an even higher proportion from Gaza. This dependency later allowed Israel to use unemployment as a collective punishment, closing the borders during periods of tension and the Intifadas of 1987-93 and 2000-05. At the same time, rising oil prices in the Gulf states encouraged skilled Palestinian workers to seek work there. In the years after the war, around 700,000 were to leave for good, including more than a few who were expelled.

These policies were aimed at increasing Israel’s control over the Palestinians and undermining support for Palestinian National Liberation Movement (Fatah) leader Yasser Arafat’s Palestine Liberation Organisation (PLO), with its commitment to achieving a Palestinian state through armed struggle. In the immediate aftermath of the 1967 War, the West Bank’s economy grew at 15 percent a year and Gaza’s at 11 percent, as they recovered to their pre-war levels. But at the same time, industry’s share of the Palestinian GDP fell from 9 percent in 1968 to 7 percent in 1987.

According to the UN, the loss of revenue to the Palestinian economy from 1970 to 1987 was $6-11 billion, or 13 percent of GDP. These changes rapidly transformed Palestinian territories from a diversified society of peasants, small businessmen and professionals into a working class and a reserve army of labour for Israeli employers, subject to the economic and political dictates of Israeli capital.

Broader international developments also took their toll. Following the stock market crash on 1987-88, falling oil prices, fewer work opportunities in the Gulf, the deflationary policies pursued in the United States, the mounting costs of the occupation and the resultant budget and trade deficits, were to lead to a major economic crisis in Israel, as inflation soared. For the Palestinians, this meant a sharp fall in the value of their wages, ever deteriorating working conditions—already far below those of their Israeli counterparts—fewer job opportunities and lower budgetary support. Settlements built on confiscated Palestinian land and land seized to build settler-only roads and secure the settlements expanded, further undermining the Palestinian economy.

The economic downturn was one of the factors—along with anger over Israel’s 20-year-long military occupation and its war on the Palestinians and their allies in Lebanon—that led to the outbreak of the first Intifada (uprising) in 1987. It erupted largely outside the control of the PLO, whose leadership was then based in Tunis after being driven out of Jordan in 1970 and Lebanon in 1982 and abandoned by the Arab regimes.

These conditions, along with the broader turn to Islamist politics in the Arab world following the collapse of Nasser’s pan-Arabism, benefitted the Muslim Brotherhood-affiliated Hamas (Islamic Resistance Movement), a bourgeois clerical group that Israel at first sponsored and encouraged in opposition to Fatah. But Hamas, with its religious fundamentalism, offered only a more extreme form of nationalism, articulating the interests of the Palestinian bourgeoisie, not those of workers and peasants.

Oslo tightens the noose

The Intifada began on December 1987 in Gaza’s Jabaliya refugee camp after an Israeli Defence Forces truck crashed into a civilian car, killing four Palestinian workers, including three from the camp. It was to take Israel six years to suppress the uprising at a cost of more than 1,000 Palestinian lives, 175,000 arrests and 2,000 homes demolished. The conflict devastated the Palestinian economy, with the standard of living falling by a massive 30-40 percent.

The uprising convinced Israel’s Labor party leaders, out of power since 1977, of the need to reach some sort of accommodation with PLO leader Arafat and Israel’s Arab neighbours. The establishment of a Palestinian statelet would, they believed, help to ensure Israel’s stability and development and maintain its Jewish majority. Arafat and a Palestinian Authority (PA) would take over Israel’s role of controlling the Palestinian masses, in return for the PLO’s acceptance as the sole representative of the Palestinian people. This autonomy would, Israel’s rulers hoped, ensure continued economic dependency, while also opening new markets than Israel’s garrison state could ever deliver and potentially transforming it into a regional economic power.

To be continued