Global Economic Context      

Looking at the last third of the twentieth century, Canadian economist James Davies, in a study prepared by the World Institute for Development Economics Research, wrote “income inequality has been rising for the past 20 to 25 years and we think that is true for inequality in the distribution of wealth.” In 2,000 the study showed, the top 1 percent of the world’s population accounted for 40 percent of the its total net worth, with the bottom half owning 1.1 percent. Edward Wolff, another economist participating in the study, wrote “With the notable exception of China and India, the third world has drifted behind.” (New York Times, December 6, 2006).

 The starkest interpretation of this kind of data was reflected in a 2003 article by Egyptian economist Samir Amin, who asserted that the global economy is creating what he called “the precarious classes,” both in agriculture and manufacturing, who cannot count on day-to-day remunerative activity to survive. He estimated that 2/3 to 3/4 of humankind is among the “precarious classes.”


Relevance to the Middle East in the 21st Century

A financial publication entitled “Arab Banker” printed a summary of a World Bank study, “Two Years After London: Restarting Palestinian Economic Recovery” in 2007.  The World Bank, the Arab Banker, and other sources presented the following alarming data:

-The percentage of Gazans living in poverty steadily increased from 1998 (21.6%) to 2006 (35%).

-Israeli policies barring imports and exports isolated Gaza from the Israeli and global economy made matters worse; a 90 % decline in Gaza’s industrial operations occurred between the 2006 parliamentary election victory of Hamas and 2007

-Industrial employment in Gaza declined from 35,000 in 2005 to 4,200 in 2007. 


During the first decade of the new century, comparative economic data on Israel and the occupied territories indicated that West Bank and Gaza gross national product per capita was about 10 percent of that of Israel.

More recently, the United Nations issued a report entitled “Socio-Economic and Food Security Survey 2012: West Bank and Gaza Strip, Palestine.” This report was produced under the auspices of the Food and Agriculture Organization, the United Nations Relief and Works Agency for Palestinian Refugees in the Near East, and the World Food program. It documented a connection between food insecurity in Palestine and external constraints on the economies of the West Bank and Gaza imposed by occupation and blockades. Among their findings were the following:

-34 percent of Palestinian households, comprising over 1.5 million people live in situations of food insecurity (19 percent in the West Bank and 57 percent in Gaza).

-Food insecurity, increasing since 2009, derived from growing unemployment, declining purchasing power, and slowed or abandoned aid thus decreasing jobs, income, and consumption.

-Food insecure households (often with larger families) are more likely to experience disabilities and chronic illnesses.

The report made three general recommendations: lift the embargo on Gaza, increase West Bank access to the Israeli economy, and support efforts to increase economic productivity in the West Bank and Gaza.


The Middle East Wars

 The contested land of Palestine had been largely populated by Muslim peoples from the 7th century until the mid-twentieth century.  In 1947, the year that the United Nations recommended the partition of Palestine into two states, only 1/3 of the land’s inhabitants were of Jewish background. On May 14, 1948, David Ben-Gurion, the Executive Head of the World Zionist Organization and the chairman of the Jewish Agency in Palestine, declared the establishment of a new state of Israel, and the first Middle East war between the new Israeli army and Arab states ensued. Palestinians and Arab neighbors regarded the creation of the new state as an occupation of the historic residents of the land. Over the course of this first Middle East war and those that followed hundreds of thousands of Palestinians became a displaced population.

Subsequently wars occurred in 1956, 1967, 1973, 1982, and intermittently from the 1980s until today. Wars were fought among Israelis, her neighbors, and Palestinians who lived in what became the occupied territories. Disputes have involved the legitimacy of the state of Israeli; Israeli expansion particularly its continuing construction of settlements in the West Bank and the displacement of Palestinian people; the rights of Palestinian peoples inside Israel, control of water and land throughout the region; and other issues. Various organizations challenging the Israeli state and land expansion emerged over the last fifty years including the Palestine Liberation Organization, Hamas, and Hezbollah. Outside nations, the United States and the Soviet Union during the Cold War; former European colonial powers such as Great Britain and France; and neighboring Arab and other Muslim states; have provided support for contending Israeli and Palestinian parties to the continuing conflict.

The United States became Israel’s main ally during all these years. Since 1979 Israel has been the largest recipient on a per capita basis of foreign assistance from the United States of any of the latter’s clients. In addition, Israel has become the best equipped and most powerful military force in the region, largely due to the billions of dollars of U. S. military assistance. Israel is the only state with nuclear capabilities in the region.

Finally, pro-Israel lobby groups in the United States support continued military and economic aid to Israel, Israel’s opposition to serious negotiations with what is now the Palestinian Authority in the West Bank and Hamas ruled Gaza, and oppose  initiatives from peace groups in the U.S. and the international community. Currently, militant pro-Israel lobby groups are pressuring Congress to pass legislation threatening expansion of Iranian sanctions in the midst of a major Obama administration effort to reach accords with Iran on nuclear weapons. These domestic groups and the Israeli government regard Iran as the number one enemy in the region.

Violence and instability in the region, the tragedy of 9/11, worldwide terrorism directed against U.S. targets, and insurmountable and spreading conflicts have been directly related to Israel’s economic isolation of and military policies toward the Palestinian people and the continuing US support of Israel’s behavior. Within the United States, critics of U.S. support of Israel are excoriated and politicians are intimidated such that policy debate on Israel’s treatment of the Palestinians inside Israel as well as economic embargoes and military attacks on interim Palestinian institutions and people in Gaza and the West Bank are largely censored from public discourse.


What Does This Mean?

First, violence and political instability in the world is intimately connected to the absence of economic well-being.  The economic crises faced in recent years in the industrial capitalist world are small compared to the punishing crises of survival that some countries of the Global South still experience in the 21st century; countries and territories of the Middle East are prime examples.

Second, data suggests clearly that in the occupied territories (the West Bank, Gaza, and the Golan Heights, all conquered in the 1967 Middle East war) the notion of “precariousness” (joblessness, land theft, food insecurity, grotesque economic and political inequalities in the region) is an apt way to describe the condition of the Palestinian people.

Third, shifting currents in Palestinian politics have been connected to patterns of economic growth and decay. In the 1950s and 1960s, secular leaders in the Arab world, including Palestinians, offered a vision of economic change and political autonomy for their people that was processed in Washington, and European capitals as threatening to dominant economic interests. Paradoxically, the U.S. began to support political actors in the region with a religious agenda, such as the followers of Osama Bin Laden in Afghanistan and Hamas in Palestine. Subsequently, these groups responded to the sense of economic injustice that peoples like the Palestinians experience.

There is no easy solution but the United States and other wealthy countries have an obligation to participate in a disinterested economic reconstruction of the occupied territories and support for complete political autonomy of the Palestinian people. Only that will break the back of anger, mutual hatred, and political instability. The United States should stop fueling the violence in the region by ending military aid to Israel. Economic reconstruction requires negotiation toward the creation of a viable Palestinian state, land repatriation, and guarantees of security from Israeli military attack. For example, Israeli settlements in the West Bank need to be dismantled. Economic development must be coupled with economic justice.

In the United States, the political climate needs to change so that a resumption of frank dialogue can proceed on United States foreign policy toward Israel, ending the violence in the region, and supporting economic justice and political rights for the Palestinian people.