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  1. Wealth
July 5, 2011

The Palestinian Economy

By Spear's

Far from effecting any displacement of Arabs, the Jewish settlements enabled a huge increase in both the number and wealth of the Palestinian Arabs

The spurious ideology of Palestinian victimization by Israel blinds nearly all observers to the actual facts of economic life in the region. In the mid-19th century, before the arrival of the first groups of Jewish settlers, Arabs living in what became the mandate territory of Palestine numbered between 200,000 and 300,000. Their population density and longevity resembled today’s conditions in parched and depopulated Saharan Chad.

The fact that some 5.5 million Arabs now live in the former British Mandate, with a life expectancy of more than 70 years, is mainly attributable, for better or worse, to the work of those Jewish settlers. In draining swamps, leaching saline soils, redeeming dunes into orchards and poultry farms, in planting millions of trees on rocky hills, in constructing elaborate water works and terraces on the hills, in digging 548 wells and supporting canals in little more than a decade and irrigating thousands of acres of land, establishing industries, hospitals, clinics, and schools, the 500,000 Jewish settlers who arrived before the creation of Israel massively expanded the very absorptive dimensions and capacity of the country.

It was these advances that made possible the fivefold 20th-century surge of the Arab population by 1940. The new opportunities in Palestine attracted hundreds of thousands of Arab immigrants from Iraq, Syria, Jordan, and the desert. By 1948, the Arab population in the Mandate area had grown to some 1.35 million, an increase of 60% since the 1930s.

With wages for Arab workers double or more the wages in Syria, Jordan, and Iraq, in 1936, a British Royal Commission could report: “The whole range of public services has steadily developed to the benefit of the [Arab] fellaheen… the revenue for those services having been largely provided by the Jews.”

Following 1948, the Palestinians continued to benefit heavily from Israeli enterprise and prospered mightily compared to Arabs in other countries in the region. During the era of Israeli “occupation” from 1967 to 1993, the number of Arabs in the territories tripled to some 3 million, with the creation of some 261 new towns, a tripling of Arab per capita incomes, and a rise in life expectancy from 52 to 73 years.

Far from effecting any displacement of Arabs, the Jewish settlements enabled a huge increase in both the number and wealth of the Palestinian Arabs. Nowhere in the world outside of the United States have Arabs performed as well economically as have Arabs in Israel. Any income gap between the Jewish and Arab populations of Israel is clearly attributable to the prowess of Jewish entrepreneurs and other professionals, whose excellence produces similar gaps in every free country on earth with significant numbers of Jews.

Jews, for example, out-earn other Caucasians in the United States by an even larger margin than they out-earn Arabs in Israel. On April 9, 2011, the PLO’s chief representative in the US, Maen Areikat, told the Jewish Forward: “Palestinians are not after improving their condition of living. Our real problem is ending the occupation” – getting rid of those dastardly settlers!

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With Hamas now joining with the Palestinian Authority and with $4 billion in new foreign aid, including $900 million directly from the U.S. pouring into Gaza and the West Bank, the immediate prospects are grim. Nonetheless, Israel’s current administration, under the business-savvy leadership of Benjamin Netanyahu, is committed to the economics of collaboration and prosperity. As the abatement of violence permits, he is resolutely opening up new opportunities for Palestinian entrepreneurship and growth.

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