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Bulletin 2: The Settlements - Economic Cost to Israel |
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Written by Shir Hever
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Wednesday, 17 August 2005 |
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Page 4 of 5
Conclusion:
Compensations
A recent estimate of the cost of the so-called Disengagement Plan is NIS 8.5 billion.(52) About NIS 7 billion will be compensations for the settlers, who are currently appealing to the Supreme Court to ask for more money. The settlers in Gaza are less than 1.7% of the total settler population, so compensations for the West Bank settlers in the event of a future withdrawal will exceed NIS 421 billion (multiplied by the future increase in the settler population).(53) We can learn two things from this.
One, the total accumulated costs of the occupation does not include the potential costs of a future evacuation. Two, the settlers not only received a continuous and intensive government support and subsidy for almost every aspect of their lives, but now demand to be compensated for the loss of their preferred treatment. When the security costs are added but no interest is calculated, an average settler received over NIS 39,100 annually since the start of the occupation in excessive funds (beyond the government?s investment on other citizens of Israel).
Finally, none of the estimates above considered the compensations for the Palestinians. If we realize that eventually Israel will have to compensate the Palestinians for the past four decades of occupation, realize that all of the previous estimates are just the tip of the iceberg.
Who actually pays these costs?
Most of these costs (especially for security) are paid directly by the Israeli government through the state budget. The rest of these costs are paid by government institutions such as the Institute for Social Security, the World Zionist Organization or the Israeli Lottery Institution (Pais).(54) Economic losses of private individuals were not taken into account in this article, though they are probably considerable. Most of the budget is funded with taxes that the government levies from the public.(55)
However, two other groups also bear some of the burden:
- U.S Citizens: The U.S funnels to Israel about US$ 1.8 billion annually in military aid alone since 1973.56 These funds, when calculated with interest, most definitely surpass the security costs of the occupation. Since this massive funding began in 1973, it raises the question of why the U.S sees it necessary to fund the Israeli occupation and whether cutting this funding will force Israel to stop the occupation.(57) William Bowels of the Information Clearing House says that Israel?s economy is already on the brink of collapse, held together artificially solely because the U.S is directly funding the occupation of the OPT.(58)
- Palestinian Population: for the Palestinians, the correct term is ?damages? rather than cost, as they never ?bought? their own occupation. However, they did pay for it partially in taxes that they were forced to pay to Israel. Their own taxes were turned against them to build forts, bypass roads, roadblocks and the Wall, and to create an infrastructure for extracting their resources to the benefit of Israelis. These damages will be discussed in a future publication.
Profits of the Occupation
The profits of the occupation are too widespread to be fully discussed here, but are important to understand when analyzing the reasoning for the ongoing occupation. In fact, the concept of ?cost? that was used here might be misleading. The occupation has not only caused significant economic damage, but actually involved a substantial redistribution of income. Whenever the government spent extra money on funding the occupation, someone made his or her own cut of this money.
Here is a partial list of the beneficiaries of the occupations:
- Settlers enjoy a very high lifestyle compared to other Israelis.(59)
- Military officers and the military industry enjoy the endless need for more security measures and the constant increase in military expenditures.
More recently, private security companies have begun to flourish in Israel.(60) The military industrial complex in Israel uses the OPT as a place for ?field trials? of new weapon systems. Military exports from Israel in 2004 totaled US$ 4.5 billion, with US$ 10 billion more in pre-orders, and was 10% of the total military export in the world.(61)
- Company owners in Israel who use the Palestinians as scapegoats for the economic recessions, to justify lowered wages and massive layoffs, or as scapegoats to justify faults in supply (blaming the Palestinians as ?unreliable workers?).
- The financial sector businesses (especially banks and insurance companies) respond quickly to changing situations and make large profits from the financial instability caused by the volatile reality of the occupation. Also, the mass media and cellular phones sectors also enjoy revenues from the panic of Israelis.(62)
- Employers can exploit Palestinians workers because the occupation prevents the Palestinians from acquiring alternative income avenues.(63)
- The general Israeli (mostly Jewish) public, enjoying their higher status when they compare themselves with the Palestinian population. Although the occupation is costly, it allows the Israelis to be the relative kings of the hill.(64)
Conclusion
In monetary terms, funding the Israeli occupation of the OPT has been the most expensive project undertaken by Israel since 1967. The reason for this has been that Israel chose to suppress the economy, the culture, the human rights and the dignity of the Palestinians. The Palestinians do not sit idly as Israel exploits and suppresses them, and their efforts to break free from Israel?s control forced Israel to spend more on security than on anything else, taking the shape of a militarized state, constantly on guard against the resistance of the oppressed Palestinians.
The occupation continues, for Israel still has the means the perpetuate it. Although the Israeli economy is straining, U.S funds and arms continue to reach Israel and allow it to maintain its military superiority and violent control of the OPT.
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