Palestine: Zionism, class and occupation

In the early twenty-first century, the Middle East has become one of the defining geopolitical regions of struggle. America’s quest for oil and political domination has plunged the region into deeper crisis, with struggles against us, British and Israeli imperialist domination, colonialism and occupation being fought in Iraq, Afghanistan, Lebanon and Palestine, while threats of “pre-emptive” action have been made against Iran and Syria. While the us fights an increasingly losing battle against resistance forces in Iraq, Israel’s failed war in Lebanon has given heart to the Palestinians, who continue their struggle against Zionist occupation.

This struggle by the Palestinians against Israeli occupation has played a defining role in the region for more than 100 years. While much has been written about the Palestinian struggle for national liberation, little has been written by the revolutionary and radical left that explores in depth the class nature of Zionism, the Israeli state or Palestinian society. The ongoing absence of a class-based analysis results in confusion not only about the class nature of the Israeli state but also about Palestinian society and the resistance.

Class nature of Zionism

Marx, Lenin and Trotsky all explored “the Jewish question” in depth. However, it was Belgian Jewish Marxist Abram Leon who provided the first extensive Marxist analysis of Zionism. In The Jewish Question: A Marxist interpretation, Leon argued that Zionism is a product of the late phase of capitalism. According to Leon, “Zionist ideology, like all ideologies, is only the distorted reflection of the interests of a class. It is the ideology of the Jewish petty bourgeoisie, suffocating between feudalism in ruins and capitalism in decay”.

Political Zionism, as opposed to spiritual Zionism, arose in reaction to the waves of anti-Jewish pogroms and anti-Semitism that spread through Europe in the late nineteenth century. A small section of the European Jewish petty bourgeoisie began to subscribe to the idea that anti-Semitism was not a result of historical developments within capitalism but an inevitable occurrence as long as Jews lived among non-Jews. The two most prominent writers and proponents of Zionism from the European Jewish petty bourgeoisie were Leo Pinsker, who in 1882 wrote the first political tract on Zionism, Autoemancipation, and Theodore Herzl, who fourteen years later wrote what was to become the guiding text for Zionists, Der Judenstaat (The Jewish State).

Pinsker argued that hatred of Jews was an eternal and inevitable psychological trait shared by all non-Jews and that the only solution to anti-Semitism was for Jews to return to Palestine. Herzl, a journalist and secular Austrian Jew, was profoundly influenced by the Dreyfus affair, which he covered in 1894. Captain Alfred Dreyfus was a French military officer who was unjustly accused of treason and whose trial was fuelled by anti-Semitism. Herzl, an assimilated Jew (i.e. secular and integrated into European society), came to believe as a result of the Dreyfus affair that Jews could never be integrated into European society and that the only way to overcome anti-Semitism was to establish an independent state for Jews.

Zionism and national liberation

Like Pinsker, Herzl understood that because the world was carved up by the great colonial powers, historical Palestine might not be the only region for a new state for Jews. In chapter 2 of The Jewish State, he argued that Jews should accept whatever the colonial powers were willing to give them, saying, “Shall we choose Palestine or Argentina? We shall take what is given us, and what is selected by the Jewish public opinion”.

In addition to Argentina, Herzl also explored the possibilities of setting up a Jewish state in Uganda, Kenya, Angola and North Africa. In 1903, Herzl enthusiastically accepted the British government’s Uganda Plan to establish a Jewish colony in Africa. However, one year after his death in 1904, the Zionist Congress of 1905 decided to reject the plan, in favour of establishing a state in Palestine.

Despite claims by Zionists that the quest to establish a Jewish state is no different from other forms of nationalism or national liberation struggle, it is in fact very different. According to Leon, while the Jewish people constitute a “people-class”, they “do not constitute a race of people”. In the Jewish Question, Leon argued that historically Jews were just one of many peoples—Hittites, Canaanites, Philistines, Egyptians, Phoenicians, Greeks and Arabs—that constituted the people of historical Palestine. The Jewish people, Leon went on to point out, far from constituting a race or nation, are in fact one of the “most typical and conspicuous examples of racial mixture”.

This is because Jewish people for more than 2000 years have been integrated and assimilated into a range of host nations. Although Zionists cite the destruction of the Second Temple in the first century bc as the catalyst for the Jewish Diaspora, Leon argued that in fact three quarters of Jews at that time were already living outside Palestine. According to Leon, “there is absolutely no racial homogeneity” between the majority of Jewish people because they were assimilated and integrated into new host nations such as Egypt, Syria and Mesopotamia, and as a result, the concept of the “Jewish race is a myth”.

It was only with the advent of capitalism and its subsequent decline that Jewish “nationalism” began to develop in Europe in response to anti-Semitism. According to Leon, historically Jews had been part of a mercantile caste. This economic and social role helped constitute them into what Leon called “a people-class” retaining certain religious, ethnic and linguistic traits. This did not mean, however, that all Jewish people were merchants. In arguing that over time Jews developed into a people-class, Leon was arguing that the dominant profession for Jews became concentrated in a functionally specialised area of society, in this case, mercantilism and trade. And this was a material expression of monetary economy within a society that rested on use values.

Feudal Europe was dominated by a use-value economy. However, when commerce based on industrialisation began to develop, the economy became dominated by exchange values. After the twelfth century, western economies began to develop their own “native commercial and industrial class”, and Jewish traders and merchants began to be pushed out. European capitalism was unable to expand sufficiently and quickly enough to absorb the dislocation resulting from the rapid disintegration of feudal relations. As a result, the influx of landless peasants into cities began to challenge the traditional position of Jews as a mercantile caste.

During this period, “the newly emerging non-Jewish urban middle class sought to enrich itself in a limited market at the expense of Jewish traders and artisans and the big landowners and capitalists sought to divert the discontent of non-Jewish workers and peasants towards a convenient scapegoat, resulting in a qualitative increase in anti-Semitism”.1

According to Leon, the “the foundations of national movements and that of Zionism are altogether different”. While the national movements of the European bourgeoisie were a consequence of capitalist development and the need to create national bases of production, the Zionist movement was a consequence of the decline of capitalism. Zionism, argues Leon, “is in fact the product of the last phase of capitalism, of capitalism beginning to decay” but “pretends to draw its origins from the past more than 2000 years old”.

Zionism in Palestine

The first Zionist immigration to Palestine began in the late nineteenth century, with the First Aliya (ascent) and was based more on spiritual or religious immigration. Subsequent Jewish immigration and colonisation in the twentieth century, however, took place under the auspices of political Zionism. Only after they had arrived in Palestine did Zionists begin to appreciate that Palestine was already inhabited by half a million Christian and Muslim Arabs, who were not prepared to give up their land without a fight.

In 1891, famed Jewish writer and spiritual Zionist Ahad Ha’am (Asher Ginzberg) noted in his Truth from Eretz Israel:

From abroad, we are accustomed to believe that Eretz Israel is presently almost totally desolate, an uncultivated desert, and that anyone wishing to buy land can come and buy all he wants. But in truth it is not so. In the entire land it is hard to find tillable land that is not already tilled; only sandy fields or stony hills, suitable at best for planting trees and vines, even that, after considerable work and expense in clearing and preparing them—only these remain unworked.

Ha’am went on to write:

From abroad we are accustomed to believing the Arabs are all desert savages, like donkeys, who neither see nor understand what goes on around them. But this is a big mistake ... The Arabs, and especially those in the cities understand our deeds and our desires in Eretz Israel, but they keep quiet and pretend not to understand, since they do not see our present activities as a threat to their future ... However, if the time comes when the life of our people in Eretz Israel develops to the point of encroaching on the native population, they will not easily yield their place.

The early days of spiritual and secular Zionism, from the 1890s to the beginning of World War One, involved buying up land in Palestine from absentee landowners, most of whom lived in Damascus or Beirut. During the Second Aliya, from 1905 until 1914, the Jewish population in Palestine doubled from 30,000 to 60,000 (around nine per cent of the population), most of these new immigrants being adherents of political Zionism.2

It was during this period that the full impact of the Zionist political threat to Palestinian national aspirations began to be realised. Between 1908 and 1914, Palestinian newspapers such as Al-Karmel and Filastin, and other papers in both Palestine and the Arab world, began to campaign against political Zionism. Palestinians and Arabs began to understand that the aim of Zionism was to create a Jewish polity at the expense of and in place of the Palestinian Arab majority.

During the war years, both the Arabs of the Ottoman Empire and the Zionists lobbied the British powers. In 1915, the British government promised to support Arab national aspirations in Palestine, if they fought against the Turks. However, by 1917 it was clear that Britain had chosen to support the Zionist campaign. On November 2, 1917, Lord Balfour in a letter to Lord Rothschild confirmed the British government decision, writing, “His Majesty’s Government view with favour the establishment in Palestine of a national home for the Jewish people ...”

As the war began to draw to a close, in 1917 the Allied imperialist powers began to put into action the secret plan they had drawn up in 1916 to carve up the Arab provinces of the Ottoman Empire. Revealed to the world when Trotsky and the Bolsheviks made public other secret inter-Allied agreements after the Russian Revolution, the Sykes-Picot Agreement gave most of Syria and present day Lebanon to France and Palestine to Britain.

The origins of the Palestinian resistance

Betrayed by the British, the Palestinians railed against both the British mandate and Zionist settlement. In particular, the Palestinians opposed any British attempts to divide their community along religious grounds, demanding to be treated as a single community. The Palestinians felt that by trying to divide them on religious grounds, Britain was trying to undermine the united Palestinian position that opposed increased Zionist colonisation.3

The first Palestinian riots against Zionist colonisation took place in 1920. In 1921, riots in Jaffa resulted in more than 200 Zionists being killed and 120 Palestinians dying. In 1923, when Britain held elections for a legislative council, Muslim and Christian Palestinians boycotted them after considerable debate because the council would not challenge the terms of the British mandate or politically oppose Zionist colonisation. In 1925, the first of a series of general strikes took place opposing both British rule and Zionist colonisation.

In 1929, when Zionists attempted to implement Jewish-only access to the Temple Mount in Jerusalem, where the Western (Wailing) Wall, Al Haram al Sharif (the Dome of the Rock) and the Al Aqsa Mosque are located, riots broke out in which Palestinians attacked Jews in Jerusalem, Hebron and Safed. One hundred and thirty-three Jews and 116 Palestinians died. While the catalyst of the riots was access to the Temple Mount, the underlying reason was the popular Palestinian resentment of Zionist colonisation.

By the mid-1930s, the key demand of the Palestinian national movement was an end to Jewish immigration and land purchases and that Palestine become an independent state connected to Britain by treaty. While the movement called for the ratio of Jews to the total Palestinian population to be capped at thirty per cent, it also called for Jewish political and civil rights to be safeguarded and for Hebrew to be given the status of the official second language in Jewish regions.4

As Zionist colonisation increased, Palestinian fellahin or peasants and labourers began to form a rural armed resistance. Led for fifteen years by Izz al Din al Qassam, a Syrian who had fought against French rule during the Syrian revolt in 1921, the Palestinian rural resistance opposed the sale of land and the expulsion of Palestinian farmers and workers. Al Qassam’s legacy continues in Palestine today, his name being adopted by Hamas’ armed wing and for the homemade rockets fired by Palestinian militants from Gaza into Israel.

In 1935, al Qassam was killed by British troops as he was leading an overt revolt against them. His funeral in Haifa became an enormous public demonstration, opposing the British mandate and Zionist colonisation. Al Qassam’s work and death sparked enormous protests and also helped spark the 1936 general strike and revolt, when fellahin in the northern part of Palestine staged an uprising in an attempt to drive out both the British and the Zionist settlers.

The revolt was strongest in the areas where new Jewish settlements were greatest. It took 20,000 British troops and 14,500 members of the Zionist Hagana almost three years to put it down. During the revolt, British police stations and other British buildings were targeted, roads were blocked, railroads were cut and British convoys were attacked.

More than 5000 Palestinians were killed by British troops, and numerous Palestinian villages were bombed out of existence by the British air force. Hundreds of Palestinians were convicted by military courts and at least fifty-four hanged, while a further 2500 were detained in internment camps. Britain also carried out a policy of collective punishment, demolishing Palestinians’ houses and enacting curfews. Towards the end of the revolt, the country was under a virtual state of siege. Palestinian and Arab political parties and associations were outlawed, their leaders deported or exiled.

Between 1936 and 1939, Jewish brigades were illegally trained by the British mandate forces. These brigades, based on kibbutzim or the labour movement, were known as the Hagana (or Civil Defence Organisation). In principle they were illegal, but the British openly collaborated with them and used them as a policing force against the Arab population and to help put down the Palestinian upraising. The Hagana were the forebears of the current Israeli occupation forces.

In the wake of the Great Uprising, the British established the Peel Commission to examine the situation. The commission’s report, published in 1937, proposed the partition of Palestine. The proposal was rejected by the Palestinian leadership, but accepted with qualifications by the Zionist leaders. The acceptance of the plan by David Ben-Gurion was a purely pragmatic decision; he and other Zionist leaders viewed it as a way of consolidating a Jewish military force, allowing them to launch future offensives to gain the remaining territory.

In 1938, Britain dropped the plans for partition. However, in the wake of World War Two and the Holocaust, the plans were revived by the United Nations in 1947. Fifty-four per cent of Palestine was to be awarded to the Zionists, although they made up only one third of the population.

In the months before partition was to take place, the Zionists began preparations for war, launching Plan Dalet, under which both the Hagana and the Zionist terrorist militias, the Irgun and Stern Gang, carried out attacks on Palestinian villages and cities, terrorising and killing hundreds, perhaps thousands, of Palestinian civilians between December 1947 and April 1948.5

In the wake of these terror attacks, hundreds of thousands of Palestinian fled their homes. On May 15, 1948, the Arab armies entered the newly created state of Israel only to be decisively beaten, allowing Israel to gain, as Ben-Gurion, had envisaged, even more territory. By early 1949, the Zionists had control of seventy-three per cent of Palestine, more than 725,000 Palestinians losing their homes and becoming refugees.

Zionism, class and the creation of the Israeli state

The class nature of the Zionist movement both prior to 1948 and today can be clearly seen in the way that Zionism has sought to resolve the “Jewish question” without destroying capitalism. Instead, it sought to harness both colonialism and imperialism to bring about the establishment of a Jewish capitalist state. The relationship between Zionism, colonialism and imperialism, however, is unique and is rarely understood fully by much of the left.

While the Zionist project in Palestine was and is a colonial project, it also has a number of significant features that make it different from other colonial projects. This is essential to understand if we are fully to comprehend the class nature of both Israeli and Palestinian societies, as well as the class and economic nature of the occupation and the impact that this has on the prospects for resistance and victory.

Colonialism and ‘the conquest of labour’

The Zionist project advocated by Herzl, like all colonial projects, sought to exploit the riches of the country being colonised and to establish a ruling class. However, unlike other colonial projects, it sought to replace the indigenous population completely. Rather than exploit the potential labour of the native population, Zionism sought to replace Palestinian wage labourers with Jewish workers.6

For the first half of the twentieth century, the guiding star of the Zionist project was “the conquest of labour”. The conquest of labour placed the Jewish worker at the centre of the colonial and Zionist project and “insisted that Jewish employers used Jewish labour only”.7 This resulted in conflict not only with the Palestinian fellahin but also with the earlier settlers from the First Aliya, many of whom preferred to use cheap Palestinian labour. The early settlers represented the typical bourgeois attitude to colonialism, but they were challenged at every turn by “labour” Zionists who advocated the replacement of Palestinian workers by Jewish workers.

If the attitude of the First Aliya settlers had prevailed, it is quite possible that “Palestine might have developed along much the same lines as Algeria, South Africa and Rhodesia [Zimbabwe]”.8 But this was not to be the case. Instead, an economy moulded by Zionist ideology developed, one which blocked the emergence of a Palestinian capitalist class and also distorted the development of the Palestinian proletariat, who found it hard to find employment, excepted in a limited capacity in the British mandate administration and public services.9

As the Zionist colonial project began to take hold in historic Palestine and Jewish labour began to replace indigenous Palestinian labour, a new Jewish working class had to be created. While European Jewish (Ashkenazi) immigration increased over a number years, the numbers were never large enough to ensure the economic dominance of the Yishuv (Jewish community) in British mandate Palestine. In addition, compared to Palestinian Arab workers, Ashkenazi Jews demanded relatively high salaries, making it difficult to develop the colonial economy. To overcome this, between 1908 and 1914 more than 10,000 Sephardim or Arab Jews, predominantly from Yemen, were brought to Palestine to work long hours in the agricultural colonies, while being forced to live in crowded and unsanitary conditions. While the Ashkenazi or European Jews, both during the British mandate period and after the creation of Israel were settled in the cities and kibbutzim near Tel Aviv, Sephardic Jews were sent to the border towns and settlements to “strengthen the borders”.

Prior to 1908, the idea of infusing the Zionist colonies with non-European or Arab Jews had been opposed by the Zionist leadership. However, with the failure of mass Ashkenazi immigration, Zionist institutions decided to bring in the Sephardim, often using force and coercion.10 Once they were in Palestine, Zionism taught them to hate the Palestinians as their competitors at the bottom of the socio-economic scale. Today, the Sephardim and Mizrahi (eastern or African Jews) make up fifty per cent of Israel’s population, while Ashkenazi Jews make up almost thirty per cent and Palestinians with Israeli citizenship, or so-called “Israeli Arabs”, are twenty per cent.

Because the Zionists were able to lock out the native Palestinian fellahin and nascent capitalist and working classes, they were also able to use the Palestinian strikes and rebellions of the 1920s and 1930s not only to consolidate their colonial project but also to replace Palestinian workers with Jewish workers and dominate the British mandate economy.

Zionism, nationalism and class

The key Zionist vehicle for the conquest of labour was the Histadrut or General Federation of Hebrew Workers in the Land of Israel. The Histadrut was established in 1920 and still exists today as the key labour organisation in Israel. It was set up “to serve the cause of conquering the land”.

In Zionist ideology, organised Jewish workers were the only true Zionists, placing the national mission of creating the Jewish state above everything else, including class, while the union was established to serve the nation, not workers. The petty-bourgeois founders of the Histadrut and the Labour Party, rather than seeking to overthrow the capitalist system, sought to become dominant in it, with the Histadrut spearheading the Zionist colonial project in Palestine.

In addition, the Histadrut also took on a corporatist role, acting as both an employer and trade union in order to suppress the class struggle in the Yishuv in the interests of Zionist capital. From 1948 on wards, the Histadrut came to dominate large sectors of Israel’s economy, not only as the largest employer of labour, but also via its ownership of industrial enterprises. During the late 1960s, the Histadrut-owned companies employed twenty-five per cent of Israeli wage earners and accounted for twenty-two to twenty-five per cent of Israeli gdp.11

In 1967, in the wake of the Six Day War, when Israel seized control of the West Bank and Gaza, the Israeli economy underwent an economic boom. The occupation significantly increased the size of Israel’s domestic market, and with the conquest of labour having established a dominant Jewish labour force between 1908 and 1967, the Palestinians of the occupied territories could now be used as a new reserve pool of cheap and exploitable labour. In addition, Israel profited in the early years of the occupation by imposing taxes on the Palestinians without providing them with services, by forcing Palestinians to pay the “security costs” of controlling their movements, establishing a monopoly over exports and imports into the territories, expropriating land and confiscating money intended for Palestinians.12

During this same period in Israel, Sephardim and Mizrahim workers were able to move up the economic ladder, to become either a more privileged part of the working class or to join the middle classes. Palestinians began to fill their places in construction, food service and agriculture.13 This helped to reduce some of the ethnic tensions that had arisen during 1970s between the Sephardim/Mizrahim and the developing capitalist class, dominated by the Ashkenazi Jews.

From 1967 until the mid-1980s, military production became the central focus of the economy. However, with a change in the global economy, Israel in the mid-80s began to move towards privatising its industries, resulting in global capital beginning to invest in Israel.

The Palestinian resistance and the first intifada

For twenty years, the brutal occupation of the Palestinian territories continued. During this time, Israelis were blind to the impact of the occupation, believing that the relative submissiveness of the Palestinians meant that they accepted the occupation. However, on December 8, 1987, an Israeli truck ploughed into a car in Gaza, killing four Palestinians, and Gaza erupted in angry anti-Israeli demonstrations, sparking the beginning of the first intifada.

The first intifada was led by the Unified Leadership of the Uprising (unlu), composed of representatives of Fatah, the Popular Front for the Liberation of Palestine, the Democratic Front for the Liberation of Palestine, the Palestinian Communist Party and Islamic groups. The unlu called for the formation of popular committees in each village and town to oppose the occupation, the committees being charged with “representing the people’s authority and function[ing] as alternatives to the crumbling apparatus of the occupier”.14 The unlu urged the popular committees to coordinate a series of strikes against the police and collaborators, to coordinate the refusal to pay taxes, to boycott Israeli goods, to boycott working in the Zionist settlements and to implement a general strike and close all businesses for designated periods.

Israelis were shocked by the economic impact of the intifada on Israel. During the first five weeks, absenteeism of workers from the occupied territories rose to fifty per cent, resulting in a slowdown in the construction industry, a breakdown in municipal services and the collapse of agricultural labour. On December 21, eighty per cent of Palestinian Israelis joined the general strike in Israel in solidarity with the territories, shocking Israel to its core. In January, 50,000 Palestinian Israelis and Jews protested in support of the Palestinians in the territories. By March 1998, the intifada had cost Israel $300 million.15

Israel’s political and military leaders responded by mass arrests and expulsions of Palestinian leaders, by placing the territories under curfew and by beating and shooting demonstrators. Refugee camps in Gaza and the West Bank were put under siege by the Israeli military, Palestinians being prevented from bringing in food and other necessities, in an attempt to force the 120,000 or so Palestinians who worked in Israel back to work.16 Despite this, the intifada continued unabated, as ordinary Palestinians found power and strength in their collective resistance.

The economics of occupation, Oslo and the road map

The Israeli and us ruling classes moved to defuse and undermine the popular movement and to bring to an end the economic and political havoc it was wreaking on Israel both domestically and internationally. In 1993, Israel agreed to sign the Oslo accords, a declaration of principles that supposedly laid the foundations for a limited, interim Palestinian self-rule or autonomy in areas of the occupied territories. However, Oslo did not define the political nature or territorial boundaries of a Palestinian state and it did not, as Edward Said noted, “include any reference, not one sentence, about the Palestinian right to self-determination”.17 Israel did not renounce its sovereignty over the territories or agree to the withdrawal of troops or settlements. Instead, Oslo ii (signed in 1995) specifically stated, “Neither party shall be deemed, by virtue of having entered into this Agreement, to have renounced or waived any of its existing rights, claims or positions”. While this seemed balanced, it was actually a crucial concession on behalf of the plo. It granted legitimacy to Israel’s pretence of possessing “existing rights” to the West Bank and Gaza and to Israel’s rejection of the right of Palestinians to sovereignty.

Under Oslo, the plo led by Fatah renounced the claim of the Palestinian people to eighty per cent of historic Palestine and agreed to postpone until the last stage of the peace process the negotiations regarding the final status of Jerusalem, the occupied territories, water, sovereignty, security, the illegal Israeli settlements and the right of return for Palestinian refugees. In return, no guarantee was given by Israel regarding the right of the Palestinian people to national independence and statehood. Rabin and Israel, while recognising the plo as the legitimate representative of the Palestinian people, never recognised un Security Council resolutions 242 or 338 or the right of the Palestinian people to an independent state.

Despite the claims of “peace camps” in Israel and around the world, the recognition of the plo in 1993 and the signing of the declaration of principles or Oslo agreement by the Rabin and Peres governments did not reflect a change in attitude towards the Palestinians. Instead, Israel viewed it simply as a better way to serve its strategic interests, ensure an end to the first intifada and give credibility to the pretence of Israeli negotiation and peace efforts. According to Israeli academic Tanya Reinhart, Oslo was “in effect the realisation of Labor’s longstanding Allon plan, by which Israel would keep about forty percent of the West Bank’s land and in the rest, the Palestinians would be allowed to have a functioning autonomy”.18

The Allon plan, which was developed in the wake of the 1967 invasion of the West Bank, left Jerusalem district, Hebron district and the Jordan Valley under Israeli control, while the remaining territory would be under Palestinian autonomous control. Like the Allon plan, Oslo would not be an agreement between equal partners. Instead it was simply an extension of previous Israeli policy that sought to stabilise Israel, maintain the ideals of Zionism, minimise Palestinian resistance and ensure little was given to the Palestinians.

The Oslo process not only helped to bring to an end the Palestinian boycott of the Israeli economy but also allowed Israel to be opened up to the global marketplace.19 During this period, Israel began to substitute foreign workers from Asia (India, Thailand and the Philippines) for the Palestinian labour that had worked inside Israel since 1967. By 1995, more than 100,000 foreign workers were employed in Israel.20 The economic incentive associated with the employment of foreign workers was twofold. In 1995, foreign workers employed in the construction industry earned an average of $600 per month, compared to Palestinian workers who earned $1200 per month. Secondly, the employment of foreign workers was calculated to ensure that Palestinian workers would not again be in a position to have the same impact on the Israeli economy that they did during the first intifada.

In the years that followed Oslo, foreign aid and commodities began to flow into the occupied territories. This money was intended to aid a smooth transition as Israel withdrew and to help develop an independent Palestinian economy. The 1994 Protocol of Economic Relations signed as part of the Oslo agreement allowed Israel to control customs and trade and allowed Palestinians to enter Israel for work. The latter part of the agreement, however, has been continually breached by Israel, ever increasing limitations being imposed on the movement of Palestinian workers into and out of Israel.

With the outbreak of the Al Aqsa intifada, sparked by Ariel Sharon’s deliberate act of provocation in September 2000, when he made a visit to the third holiest site in Israel flanked by more than 1000 security personnel, Israel’s military began tightening the occupation. The intensifying of the already brutal occupation resulted in the destruction of the nascent and fragile Palestinian economy. Between September 2000 and the end of 2002, gdp per capita in Palestine dropped by over forty per cent, surpassing the rate of decline experienced in the usa during the Great Depression and the financial crash in Argentina. While humanitarian aid grew between 2000 and 2005, the Palestinians’ own sources of income collapsed.

Profiting from occupation

Because the Palestinian economy is inextricably tied to the Israeli economy, international and emergency humanitarian aid to the occupied territories for the past five years has been the only thing that has been staving off massive hunger and disease. The current international economic blockade against Palestine, led by the us and Israel, has resulted in a spiralling humanitarian disaster in both the West Bank and Gaza, particularly the latter.

Israel, however, has made continuous economic gains from this assistance, because whenever Palestinians import goods using foreign aid money, they must buy either from Israeli companies or from international companies that pay customs duties to the Israeli government.21

In addition, Israel gains financially from its control of all essential services in the occupied territories, including water, electricity and telephony. Palestinians currently pay around four times as much for essential services in the occupied territories as do illegal Israeli settlers. According to Shiv Hever, in 2004 alone, Israel “confiscated 15.8 million USD from the aid sent to the occupied territories for utility bills owed by the Palestinians municipalities to Israeli companies”.

In 2005, Hever and the Israeli-Palestinian Alternative Information Centre (aic) calculated that the cost of the occupation to Israel is $97 billion. While the occupation generated around ten per cent of Israel’s income or 46.651 billion new Israel shekels each year, there was also a significant outlay in relation to security costs, the building of the wall and the disengagement from Gaza, as well as funding for settlements (including roads, health, agriculture, water, industry, education, housing and municipalities).

The cost of the occupation, however, is not borne by the Israeli ruling class. It is borne by the Israeli government (which taxes the Israeli working class), us citizens and the Palestinian population of the occupied territories. So while the Israeli occupation of Palestine has “caused significant economic damage to Israel”, it has also involved “a substantial redistribution of income” within Israel and the occupied territories, allowing the Israeli capitalist class to profit.22 While the most obvious beneficiaries of the occupation are the illegal Israeli settlers, who are now able to “enjoy a very high lifestyle compared to other Israelis”, the state funding of the occupation has also allowed capitalists to pursue profits at the expense of the Palestinians and the Israeli working class.

According to Hever and the aic, not only have private security companies begun to flourish in Israel, but the Israeli military-industrial complex has been a primary beneficiary because it uses the occupied territories for “field trials” of new weapons systems. In 2004, the export of this weaponry was worth $4.5 billion, or around ten per cent of the total military export in the world.

Internationally, companies like Caterpillar, Volvo and Daewoo have also profited from the occupation, all three supplying equipment to the Israel state and military. According to a briefing paper issued by War Against Want in July 2006, Caterpillar supplies the Israeli military with weapons under us foreign military sales programs, including D9 armoured bulldozers, which are an indispensable part of the military occupation and “urban warfare”. Since 2000, according to the un, more than 4500 Palestinian homes have been demolished, while the Israeli Committee Against House Demolition estimates that Israel has demolished more than 12,000 Palestinian homes since 1967. While Caterpillar is the best known supplier of bulldozers to Israel, Daewoo and Volvo have also supplied bulldozers to help construct the illegal apartheid wall. Other companies, both international and Israeli, that profit from the occupation are in the communications industry (i.e. telephone companies) and the finance sector, in particular banks and insurance companies.23

The “security barrier” that Israel is building will also maximise profits for Israeli and foreign companies. The barrier, or “apartheid wall”, as anti-occupation activists have come to call it, is made up of eight-metre tall concrete blocks, electronic fences and trenches. It constitutes the biggest Israeli land grab since 1967. The current path of the wall will result in seventy-five per cent of it being built inside Palestinian territory, resulting in at least ten per cent of the occupied West Bank being annexed to Israel.24

The wall is designed not only to maximise Israeli territory but also to steal Palestine’s natural resources (such as water and land). It is also being used by Israeli capitalists to super-exploit Palestinians workers. According to Meron Rapoport, the apartheid wall is key to the success of the cross-border industrial zones (cbiz) because it not only provides Israeli businesses with security but also ensures that Palestinians do not cross the Green Line into Israel and that low wages can be paid to Palestinians. cbizs are Israeli industrial zones that are being built in the “seamline” between the 1967 Green Line and the apartheid wall and revolve around labour-intensive industries, such as agricrops and to a lesser degree manufacturing. While Palestinians are used as cheap labour, the cbizs help entrench the illegal Israeli occupation and Palestinian oppression, both economically and politically.

Building factories in the “seamline” means that companies do not have to abide by Israeli labour or environmental laws. In 2004, Palestinian workers on average were paid only one-third of the Israeli minimum wage. Israeli companies are able to super-exploit Palestinian workers because the occupation prevents them from acquiring alternative income sources. At the same time, the companies use the occupation and Palestinians to justify pushing down wages inside Israel and economic recession in order to justify mass lay-offs.25

According to one industrialist cited by Rapoport, production costs for Israeli companies in the seamline territories will be seventy per cent less than in Israel, primarily due to the low cost of rent and low wages being paid to the Palestinians.

While much of the produce and products from the illegal settlements and industrial zones in the occupied territories are destined for Israeli markets, they also make up a large percentage of Israel’s exports. Wine, herbs, fruit juices, hair products, soft drink mixes, fruits and vegetables (e.g. peppers, oranges, olives, tomatoes, strawberries, avocados) and flowers are just some of the produce grown in the settlements and exported worldwide. Between October 2004 and 2005, exports of the Israeli state company Agrexco were worth $860 million, a rise of seventy-two per cent in just three years. Currently, this company accounts for seventy per cent of Israel’s exports. (The Israeli government announced in June 2006 that it would be selling off half the company to private investors.)

The growth of the industrial zones and illegal settlements has had a negative effect on Palestinian businesses and the economy. For example, in the Jordan Valley, where Agrexco is particularly active, Israel is expanding its illegal settlements, constructing new housing and providing grants to settlers and to develop agricultural businesses. The expansion of the settlements and industrial zones will allow Israel to annex the Jordan Valley, not only denying Palestinians the right to a contiguous state but also preventing any possible Palestinian state from having a common border with any Arab state. Water in the region is being diverted from Palestinian villages in order to serve the illegal settlements, ensuring that Palestinian crops die.

The class nature of Palestinian society and prospects for resistance

In contrast to Israel and quite a number of other Arab countries in the Middle East, Palestine has no large industries, and the industries that do exist are severally affected by the Israeli occupation. Despite the occupation of Gaza having supposedly ended, Israel’s ongoing control of land, sea and air borders has undermined and wreaked havoc on economic development in Gaza. The current siege of Gaza, which began in June 2006, has result in Israel shutting the border crossings between Gaza and Israel and Gaza and Egypt. As a result, thousands of people have spent weeks on end waiting to re-enter Gaza from Egypt (and several Palestinian children and adults have died from medical complications) and very few goods or produce are able to get into or out of Gaza.

As a result of Zionism, the occupation and imperialism, the nascent Palestinian bourgeoisie have a comprador character.26 They owe their existence to imperialist capitalists and cannot function on their own as a capitalist class, but are forced to act as a collaborator or intermediary in commercial transactions. In addition, Zionism has retarded and distorted the development of the Palestinian working class. As Adam Hanieh notes,27 since Oslo, the nascent Palestinian working class is concentrated in three sectors: the Palestinian Authority (pa), small family-owned businesses and workers employed in Israel and the settlements.

The majority of workers in Palestine are employed by the Palestinian Authority. They are the backbone of the Palestinian economy. However, since January 2006 and the election of Hamas, Israel, the usa and the eu have blockaded the Palestinian Authority, throwing the already fragile economy into free fall. Israel has refused to hand over the Palestinian taxes it collects, the majority of which funds are used to pay Palestinian government workers. The aim, in the words of Ariel Sharon’s former chief of staff, Dov Weisglass, is to place “the Palestinians on a diet” and put pressure on the Hamas government and bring about its collapse in the hoping of returning the pa to a more submissive Fatah leadership.

In Israel itself, with the substitution of foreign workers for Palestinian labourers, Israel is able to turn the tap on and off in relation to the Palestinian labour pool, utilising closures and denial of entry and permits as a way of controlling the flow of workers into Israel and the cbizs. With the building of the illegal apartheid wall and unilateral disengagement from Gaza, Israel has moved further to implement new policies in the occupied territories in order to further restrict Palestinian workers entering Israel and working in the cbizs. As a result, Palestinian workers are limited in being able to utilise the withdrawal of their labour.

This means that on a strategic level, the Palestinian struggle will not be won solely in the West Bank or the Gaza Strip. This does not mean that Palestinian workers won’t play a crucial role in their own liberation, but given the current conditions, it is essential to understand that there are specific local conditions that will impact on the struggle. As a result of the nature of the illegal Israeli occupation, it is critical that Palestinians who are citizens of Israel also play a significant role against the occupation, as they did in the first intifada.

Equally important is the Israeli Jewish working class, which is made up predominantly of Mizrahi and Sephardic Jews, who have also suffered as a result of Zionism. It is not, however, simply a matter of mechanically calling for the working class of Palestine and Israel to rise and up and join forces, as some socialist organisations do.

Currently, the majority of the Mizrahi and Sephardic Jews have been forced by Zionism to choose between their ethnicity and their religion. As a result, often Mizrahim and Sephardim identify more with the Zionist national project than with their working-class brothers and sisters, the Palestinians, who also suffer the brunt of Zionist racism, discrimination and oppression. As long as Mizrahim and Sephardim place nationalism and Zionist ideas before class considerations, there is little hope of this happening. However, in recent times there has been some progress in this area. Mizrahi and Sephardic organisations, such as the Mizrahi Democratic Rainbow, the university-based Social Justice group and Achoti (My Sister) have sprung up to challenge the dominant Zionist ideology and have begun to form alliances with Palestinian Israelis and Ashkenazi anti-racist and anti-Zionist activists. In particular, groups like Achoti have sought to provide community education around the occupation in some of the poorest areas in Israel, where the Mizrahim and Sephardim reside. These groups are undoubtedly a step forward, but it is also essential to understand that it will take time to break down the prejudices of many Mizrahim and Sephardim against the Palestinians, as well as the illusions they have in Zionism.

Also important is the “radical” left in Israel. While unfortunately the mainstream “left” group Peace Now has all but discredited itself and become irrelevant by doing little to oppose Israel’s aggression in Lebanon, a small group of radical left groups such as Anarchists Against the Wall, Yesh Gvul (refuseniks), Black Laundry (queer anti-occupation group) and Machsom Watch (Checkpoint Watch) are doing substantial and important work opposing the Israeli occupation. While these groups are small and often ignored by the Israeli mainstream media, they are building solid ties and links with Palestinian communities in the West Bank and Gaza.

Another important factor that can and does impact on the Palestinian struggle is the resurgence of resistance movements in other part of the Arab world For example, Hezbollah’s victory against Israel in the second Lebanon war raises support for the Palestinian struggle and gives sustenance to the struggle in Palestine. In particular, the Hezbollah victory has shown that Israel, despite its military superiority, can be defeated.

The struggle continues

While we recognise that we cannot, as solidarity activists, substitute for the Palestinian national movement and any shortcomings it may have, it is important that we have a clear understanding of the class nature of Israel, Palestine and the occupation. Marxists need to understand and analyse the specific objective conditions in Palestine and not apply a mechanical analysis. It is only then that we can work out the best strategy to carry out the solidarity struggle against Zionism, the occupation and imperialism.

Marxists and solidarity activists around the world can serve the Palestinian struggle not only by participating in activities that are directly in solidarity with the Palestinian people, but also by strengthening the anti-imperialist and anti-capitalist movements in our own countries. The solidarity campaign and struggle for a Free Palestine must become an important part of the struggles for refugee, indigenous and women’s rights, as well as the struggles against racism, for civil rights and human rights and for workers’ rights. This means making the Palestinian struggle a real part of these campaigns, not just an afterthought.

It is the duty of revolutionaries to continue to oppose Zionism and the occupation of Palestine and to build campaigns in solidarity with the people of Palestine, raising the links between the struggle for freedom in Palestine and the struggles of the working class in other countries. We only need to look to Venezuela to see the importance of this. During the second Lebanon war, Hugo Chavez and the Bolivarian revolution gave concrete political support to the people of both Palestine and Lebanon. That example should be emulated by revolutionaries everywhere.


1. S. Malloy and D. Lorimer, “Palestinian Self-Determination and Zionist Colonialism”, in The Palestinian Struggle, Zionism and Anti-Semitism, Sydney: Resistance Books, 2002, pp. 3-14.

2. Rashid Khalidi, Palestinian Identity: The construction of modern national consciousness, New York: Columbia University Press, 1997, pp. 93-94.

3. David McDowall, Palestine and Israel: The uprising and beyond, London: I.B. Tauris, 1989, p. 21.

4. Ibid., p. 23.

5. B. Morris, The Birth of the Palestinian Refugee Problem Revisited, Cambridge: Cambridge University Press, 2004, pp. 65-163.

6. Arie Bober (ed.), The Other Israel: the radical case against Zionism, Garden City, New York: Doubleday/Anchor Books, 1972, p. 38.

7. Ibid.

8. Ibid.

9. Ibid., p. 39.

10. E.H. Shohat, “Sephardim in Israel: Zionism from the standpoint of its Jewish victims”, in Adam Shatz (ed.), Prophets Outcast: A century of dissident Jewish writing about Zionism and Israel, New York: Nation Books, 2004, p. 294.

11. A. Hanieh, “Class, Economy and the Second Intifada”, Monthly Review, Vol. 54 (2002), No. 5, p. 21.

12. S. Swirski, The Price of Occupation, ADVA Centre: MAPA Publishers, 2005.

13. A. Adiv, “Migrant Labour in Israel”, in The Palestinian Struggle, Zionism and Anti-Semitism, op. cit., pp. 23-26.

14. McDowall, op. cit., pp. 4-5.

15. Ibid., p. 10.

16. Ibid., p. 8.

17. Cited in N.G. Finkelstein, Image and reality of the Israel-Palestine Conflict, London: Verso, 1995, p. 172.

18. The Road Map to Nowhere: Israel/Palestine since 2003, London: Verso, 2006, p. 5.

19. Hanieh, op. cit., and A. Hanieh, “Class forces in Palestine: a response”, Fight Racism, Fight Imperialism, February/March 2003,

20. Adiv, op. cit., p. 24.

21. S. Hever, The Economy of the Occupation (Part 1): foreign aid to the Occupied Palestinian Territories and Israel, Jerusalem (Israel) and Beit Sahour (Occupied Palestinian Territories): Alternative Information Centre, 2005, p. 7.

22. Ibid., p. 13.

23. Ibid.

24. War Against Want, Profiting from the Occupation: corporate complicity in Israel’s crimes against the Palestinian People, London: War Against Want, 2006 pp. 4-5.

25. Hever, op. cit., p. 13.

26. Hanieh, “Class forces”, op. cit.

27. Ibid.

[Kim Bullimore is a member of the Australian Democratic Socialist Perspective. In 2004, she lived and worked in the occupied West Bank with the human rights group, the International Women’s Peace Service. She writes regularly on Palestine for Green Left Weekly.]