An end to isolation? Palestine and the Arab revolutions

Issue: 145

Philip Marfleet

On 9 November 2014 Palestinian activists in villages near Jerusalem made a symbolic breach in Israel’s apartheid wall, their way of marking the 25th anniversary of the fall of the Berlin Wall.1 The Palestinian Popular Resistance Committees said: “No matter how high walls are built, they will fall. Just as the Berlin Wall fell, the wall in Palestine will fall, along with the occupation”.2 Despite everything Israelis throw at them Palestinians remain defiant. They need to be: as activists punched a hole in the apartheid wall, the Egyptian government was starting work on another barrier around Palestinian territory, this time on the border with Gaza, where it is clearing a buffer zone along 13 kilometres of Egypt’s border near Rafah, sealing Gaza from the south.3 The two events capture a key aspect of the Palestinians’ predicament: dispossessed, displaced and marginalised by Israel, they have also long been rejected and isolated by the Arab regimes. How to break the encirclement?

When the Arab revolutions began in January 2011 it seemed an answer was at hand. Dictators fell and mass movements spread across the region: Palestinians were no longer a people struggling in uniquely difficult circumstances but part of an upheaval in which millions challenged the established order. In Cairo the people of Tahrir Square called for liberation of Jerusalem and delegations travelled to Gaza to insist that the revolution would forge unity between Egyptians and Palestinians. Israeli leaders feared the worst. According to Israeli defence minister Ehud Barak the Middle East had been hit by “a historic earthquake” and Israel faced a political “tsunami”.4 A year earlier Israeli journalist Aluf Benn had written that political leaders in both Israel and the United States offered a “prayer for the health of the rais [president—Mubarak]”.5 He added: “Of all the world’s statesmen the one closest to [Israeli] prime minister Benjamin Netanyahu is Egyptian President Hosni Mubarak”.6 The Egyptian dictator had been a loyal friend of the United States, Israel’s closest ally. He had attempted to “normalise” relations between the governments in Cairo and Tel Aviv, forging close economic ties.

Most important, for 30 years he had contained independent political activity in Egypt, a society with long traditions of mass struggle. The energies that removed Mubarak renewed and advanced these traditions, with sustained street protests and mass strikes on an unprecedented scale. In Gaza and the West Bank, Palestinians organised demonstrations of solidarity and called for intifada in the spirit of Tahrir. After years of isolation from such struggles they saw a common purpose in challenging Arab rulers and the imperialist alliances that underpin Israel. For a time it seemed that liberation of Jerusalem would indeed be facilitated by revolutionary change in Cairo. The vision receded, however, not only because of counter-revolutions launched in Arab capitals but also because of an acute crisis within the Palestinian national movement. What had happened—and what are the implications for Palestine and for the revolutionary agenda across the Arab world?

This article addresses the Palestinian predicament in a period of political upheavals in the Middle East. It considers the development of Palestinian nationalism—the rise and fall of a movement now weaker than at any time since the 1950s. It examines the ideological agenda of Palestinian leaders, their accommodation with Israel and their eager embrace of neoliberalism. It considers the importance for the Palestinian cause of recent revolutionary struggles, most importantly the upheaval in Egypt, and new scenarios in which Palestine is part of struggles for social justice across the Middle East.


The crisis of Palestinian nationalism is now so acute that questions long avoided by Palestinian activists and academics are at last matters for open discussion. Omar Barghouti writes of a national leadership “in total disarray” and “inherently incapable of any effective resistance strategy”.7 Raja Khalidi asks about a lost “spirit of revolution”, of the movement’s failure to avoid the “pitfalls of nationalism” and of “trading one form of colonialism for another”.8 The most important issue, Khalidi suggests, is the collapse of the Palestine Liberation Organisation (PLO) into the hands of Israel and its allies: an “almost seamless transition…from their pre-Oslo militant stance to the accommodating position towards Israel, global powers, and the lures of neoliberalism”.9 Set in the context of recent Palestinian history, however, such developments are unsurprising.

The nakba of 1948 left Palestinians scattered across the region.10 Most were displaced into Lebanon, Syria, Egypt and Jordan, where those who had been peasants, workers or urban poor before displacement were allocated into refugee camps or settlements in cities such as Beirut, Damascus and Amman. A minority of Palestinians with wealth or educational advantages meanwhile moved to the Gulf, where they were instrumental in building the infrastructure of new states based on the emerging oil economy. This diasporic geography had a profound impact on the national movement that emerged in the 1950s. The mass of refugees remained impoverished and politically marginalised; their key concerns were employment, housing, education, repression and the issue of refugee return. In the camps and settlements they were tightly controlled by regimes anxious to contain Palestinian anger and its potential to influence the wider population.

In the Gulf states there was a different experience. Here Palestinian businessmen prospered in construction and commerce and as professionals (teachers, doctors, lawyers, civil engineers and administrators) playing a key role in consolidation of the new states. Saad Ibrahim comments that Palestinians became “the most influential migrant community in oil-rich countries”.11 Some became wealthy, including a group of young entrepreneurs based in Kuwait, among whom the most prominent was Yasser Arafat. Like other Palestinians in exile most were denied citizenship in Arab states and, despite their economic status, were forbidden a meaningful role in local politics. They were an embryonic bourgeoisie without a state—and the key aim of the Arafat group was to secure its status in an independent Palestine.

From the early 1950s Arafat and his colleagues lobbied Arab leaders, notably Gamal Abdel Nasser in Egypt, to undertake military action against Israel. As participants in the region’s networks of privilege they pressured presidents, kings and emirs to act for Palestine and looked forward to a time when they would enjoy equal status with these rulers. Their expectations were unfulfilled: the Arab regimes were strong on rhetoric but had no intention of liberating Palestine by military means. In the radical political climate of the 1950s, with anti-colonial struggles under way across the Global South, many Palestinians were drawn to the Arab Nationalist Movement (ANM), which argued that liberation for Palestine could only be achieved after freeing the whole Arab region from colonial control. When Arafat and others founded Al Fatah in Kuwait in 1959 they reversed this strategy: in order to achieve Arab unity, they argued, it was necessary first to liberate Palestine.12 This had a strong appeal to Palestinians of all classes—people living under Israeli occupation and in the diaspora. It raised a key question: what was the role of the latter, the majority of Palestinians who lived in Arab states? Fatah was unequivocal. Palestinian struggles, the group insisted, must be conducted on a strictly national basis. All must adhere to a principle of “non-interference” according to which Palestinians must never intervene in the affairs of Arab states.13

The proposition was strange, even perverse: Palestinians were scattered across states in which their circumstances dictated engagement in all manner of economic and political struggles. For the majority, confrontations with the regimes were inevitable. Fatah, however, had emerged as part of a new regional capitalism within which its members aimed to secure their own stake. The Arab ruling classes were to be patrons and ultimately partners, so that “non-interference” was an essential aspect of Fatah’s approach. This was not the only contradiction in its strategy. Although Arafat and others were essentially bourgeois nationalists they were influenced by the success of radical nationalism in anti-colonial struggles. When in 1965 they eventually declared for armed struggle to liberate Palestine they hoped to emulate guerrilla strategy in Algeria, China, Vietnam and Cuba. According to Arafat, when a Fatah delegation visited China in 1964 its members were told their approach was implausible: “They told us: ‘What you are proposing is unbelievable. You can’t do it. You have no bases in the territory to be liberated and no prospect of creating them. From where will you start? There are no conditions for guerrilla warfare’”.14 In 1967, following the occupation of the West Bank by Israeli forces, Fatah nevertheless sent several hundred armed men into the region in an attempt to implement this strategy. Most were soon killed or captured and the experiment was not repeated, though the organisation retained its militia and the idea that armed struggle was the key means to liberate Palestine.

In 1964 Nasser had established the PLO as a gesture to the Palestinian cause and a means to contain increasingly frustrated Palestinian activists. It had promptly fallen under Fatah control, as thousands of young fighters from the refugee camps, together with citizens of Arab states inspired by the Palestinians’ defiance, joined as fedayeen. The ANM too launched an armed wing, the Popular Front for the Liberation of Palestine (PFLP). As the armed movement grew, factions and mini-groups proliferated, many espousing radical politics but operating in effect as representatives of Arab states within the movement.15 Fatah meanwhile maintained its links with the Gulf regimes, especially the rulers of Saudi Arabia, with whom in 1969 it concluded a Faustian pact. Convincing King Faisal that the allegation that Fatah was led by communists was “a dirty lie”, the organisation’s leaders obtained an agreement that the Saudis would impose a 5 percent tax on the income of all Palestinians working in the kingdom which they would direct to the PLO.16 Fatah also obtained large grants and arms supplies direct from the Saudi state. Alan Hart comments: “The significance of Saudi Arabia’s support for Fatah cannot be exaggerated. As time proved, with Saudi Arabia on its side, Fatah was indestructible—as long as it was pursuing policies the Saudis could endorse”.17


Fatah had launched an armed movement that was unable to implement the guerrilla strategy vis-a-vis Israel but was on a collision course with the Arab regimes. In Lebanon and Jordan the PLO was soon in control of the refugee camps, which became zones of Palestinian self-rule in which activists challenged the central authority of the state.18 In an atmosphere of increasing radicalisation, confrontations were inevitable and in 1970 there was an explosive conflict in Jordan. Here Palestinian groups enjoyed unprecedented support and a move against the weak monarchical state seemed inevitable in view of its hostility to the movement. Mohammad Daoud Oudeh (Abu Daoud),19 a founder-member of Fatah, said that young officers and activists called for an early strike against the Jordanian regime but that Arafat rejected their proposals out of hand: “We discussed the question of overthrowing Hussein very seriously and very frequently… Arafat always said ‘No’. He told us that making war against Hussein or on any Arab regimes was not the way to liberation”.20 King Hussein eventually struck, and in savage fighting during and after “Black September” 1970 thousands of fedayeen were killed, eventually forcing the guerrilla organisations out of Jordan into Lebanon.

The idea of challenging any of the regimes, even as a survival strategy, was anathema to Arafat and his friends. Fatah was entangled in a complex web of relationships in which Arab regimes and corporate interests (in the form of the oil majors) were the key players; meanwhile its troops on the ground, the fedayeen, were drawn from some of the most marginalised and impoverished communities in the region, among whom there was an urgent need for change. One response from the Fatah leadership was increasing authoritarianism, a marker of even more serious problems to come.

The movement never recovered from the Jordanian debacle. For the next decade it was confined to Lebanon, where it was involved in repeated conflicts with the neo-fascist Lebanese Phalange, with Syrian forces and with the Israelis, who invaded from the south. It was also subject to a process of “Lebanisation”—the impact of factionalism, communalism and intrigue associated with a Lebanese state constructed on divisive sectarian lines, and by the malign influence of Arab regimes that used the Palestinian movement as an arena for their own competitive struggles. In 1982 Israel launched a massive invasion, eventually driving out the PLO, which set up token bases in Tunisia, Yemen and Sudan. The armed struggle as a strategy for national liberation was over.

When the next phase of struggle came it was energised from below. During the 1967 war Israel had seized Gaza and the West Bank from Egypt and Jordan respectively. In these Occupied Territories the Israelis initiated a process of rapid colonisation, seizing land and water resources and integrating the local economy into that of Israel “proper”. Settler communities were established by means that recalled European colonising ventures of the 19th century. Like the French in Algeria, Israel built colons—fortified enclaves on land seized from local villages which were set aside for the exclusive use of Israelis. The nakba continued as a process of relentless dispossession: by 1988, 52 percent of land in the West Bank and 34 percent of land in Gaza were in Israeli hands.21 Even Israel minister of economics and finance Gad Ya’acobi noted “a creeping process of de facto annexation”.22 The Palestinian population was meanwhile mobilised as a source of cheap labour for the Israeli economy, with a third of all workers in the West Bank and Gaza dependent on employment in Israel under conditions that echoed the “reserve”/Bantustan systems of colonial/apartheid South Africa.23 The situation was again explosive—and explosion duly came with the intifada that began in December 1987. This remarkable movement engaged the whole of Palestinian society in Gaza and the West Bank. For months strikes, boycotts, rallies and all manner of local actions were organised by networks of activists that extended well beyond the formal organisations of the PLO. One report from Ramallah noted:

While firmly adhering to the slogan that the PLO is the sole legitimate representative of the Palestinian people, activists here have taken the initiative on the ground. The voice of this leadership is communal and anonymous… some traditional nationalist leaders have been overwhelmed by events [and] relegated to clearly marginal roles.24

Israel was faced by multiple local leaderships it struggled to control, even by means of the usual military repression. The problem was not Israel’s alone, however—it was one shared by Arafat and the Fatah command and by the Arab regimes. Across the Middle East there were solidarity demonstrations as the intifada prompted fresh recognition of the Palestinian issue and anger at the failure of Arab governments to act. Developments in Egypt were of special importance. Here the issue of Palestine had long been embedded in domestic politics: it had been a key issue for the left during prolonged anti-colonial struggles, and a focal point for the Islamist movement. Since 1948 there had been four wars involving Israel and Israeli forces had occupied swathes of Egyptian territory. When in 1978 the Egyptian President Anwar Sadat signed a treaty with Israel brokered by the US which, in effect, abandoned the Palestinians there was huge popular anger.

The intifada of 1987 was greeted by Egyptians with mass demonstrations of support on campuses and at Friday prayers: one Islamist preacher insisted: “We demand our borders with Israel be open for jihad”.25 The movement reached Mahalla al-Kubra, a key industrial centre, where workers fought police during a demonstration that demanded practical solidarity with the intifada, denounced the Egyptian government’s dealings with the US and the International Monetary Fund, and called for the fall of Mubarak. Egypt’s interior minister declared against “sabotage and incitement” and further demonstrations were attacked by riot police.26 Phil Marshall observed:

The solidarity movement had now developed a momentum of its own and political generalisation was accelerating with every demonstration. Egypt showed what every Arab regime feared—that the Palestine question was among the most subversive in the Middle East. In the act of resisting Zionism the Palestinians confronted imperialist control of the region; in the act of solidarity with the Palestinians, Arab students and workers confronted class relations within their own society, and the relations which bound their rulers to the world system.27

As the solidarity movement spread to Turkey, Sudan, Kuwait, Algeria, Tunisia, Morocco and Syria the regimes summoned PLO leaders to help contain its impacts. Arafat personally visited Kuwait, praising the regime’s support for the Palestinians—in effect, condemning local activists. Other PLO dignitaries appeared at rallies and on television broadcasts to spell out that Palestinians were doing all that was necessary to address their problems: mobilisation of non-Palestinians was not required. Faced with a choice between the activists and the regimes, PLO leaders chose the latter.

The impact of the intifada continued to be felt across the region. In October 1988 mass protests erupted in Algeria, mobilising symbols of the Palestinian movement in sustained demonstrations and strikes against austerity measures. The Saudi media raised the spectre of “contagion” as Arab states rallied round the Algerian regime.28 A year later similar protests took place in Jordan—an “intifada of the East Bank” that the PLO leadership again did its best to contain. With the Middle East more unstable than at any time since the 1950s there was consensus among the regimes that action was needed—and that Palestine was the key issue. It was in these circumstances that the US, under pressure from its allies in the Gulf, began discussions with Israel and the PLO about a new arrangement in the Occupied Territories. Arafat undertook to make a historic concession, recognising Israel as a legitimate state, and Israeli leaders entered tortuous discussions about a Palestinian “mini-state” to be established in Gaza and the West Bank. In 1993 Arafat signed the Oslo Accords, initiating a new and damaging period of Palestinian retreat.

Neoliberal Palestine

The Oslo “peace process” was celebrated officially as a breakthrough in relations between Israelis and Palestinians from which each would benefit. It was in fact a disaster for the Palestinians, the full implications of which have become clear only in recent years. The “mini-state” to which Arafat agreed amounted to fragmented micro-territories over which a newly created Palestinian National Authority (PA—the PLO) enjoyed limited control, Israel retaining a range of powers that amounted to a mandate to determine all but minor local issues.29 As the new arrangements were put in place Israel continued to seize much of the best agricultural land of the West Bank for new and expanded settlements, and for roads that connected settlement blocs to Israeli cities. Colonisation continued at a frenetic pace: in 1993 there had been 281,800 Israeli settlers in the Palestinian territories; by 2002 the total was 427,617.30 When modest areas of land were allocated to the PA (in accordance with the Oslo schedule) Israeli politicians led new land grabs. In 1998 foreign minister (later prime minister) Ariel Sharon told Jewish settlers: “Everyone should take action, should run, should grab more hills… We’ll expand the area. Whatever is seized will be ours. Whatever isn’t seized will end up in their hands”.31

Israel was committed to what Israeli geographer Oren Yiftachel called “creeping apartheid…uncompromising attempts to Judaize the entire Israel/Palestine space”.32 This was only part of the story, however. The Oslo Accords were one element in a much wider plan, developed by American strategists, to integrate Israel and the Occupied Territories economically within a collaboration of US allies based on their commitment to neoliberal principles. The Israeli government was a full partner. Foreign minister Shimon Peres said: “We are not seeking a peace of flags; we are interested in a peace of markets”.33 When the Oslo agreement was signed change was already under way in a number of neighbouring states, notably Egypt, where in 1991 the Mubarak regime had agreed to an Economic Reform and Structural Adjustment Programme that included harsh austerity measures and new laws for marketisation and deregulation. As part of the Oslo deal, economic relations between Israel and neighbouring states including Egypt were to be fully “normalised”, including by establishment of joint Arab-Israeli activities in special industrial parks—Qualifying Industrial Zones (QIZs).34 The Palestinian economy was to be part of this regional liaison as, consistent with the formal principles of neoliberal ideology, Palestinians and Israelis exchanged “conflict for prosperity”.

Economic change after Oslo was in fact an intensification of policies Israel had pursued since its occupation of the West Bank and Gaza in 1967. The territories had been treated as if they were part of a Greater Israel—an annexe to the Israeli economy proper that provided key resources including an army of cheap labour. Israeli land seizures had radically affected the area under cultivation: between 1967 and 1974 lands farmed by Palestinians in the West Bank were reduced by a third, while Palestinian use of irrigated land (mostly in the Jordan Valley) was cut by 90 percent.35 The agricultural sector in the West Bank was laid waste and many of those dependent on it, especially rural youth, were displaced into unskilled work in Israel. Industry and commerce were also seriously affected as Israeli food products and manufactured goods flooded in. The Israeli economy grew in proportion to the contraction of Palestinian activity—a bonanza for Israeli producers and middlemen, and for a minority of Palestinians favoured by the Israeli administration. These formed the basis of a new Palestinian capitalist class that prospered as the occupation continued—initially by collaborating with Israeli military forces, later by acquiring rights from the Israeli authorities to import and export key goods and to supply labour for the construction and service sectors in Israel.

As part of the Oslo process Arafat conceded formal control over key areas of the economy, so that Israeli officials decided what the PA was permitted to import and export. By 2005 almost 75 percent of imports to the West Bank and Gaza originated in Israel, while 88 percent of the modest volume of West Bank and Gaza exports was directed to Israel.36 Israeli officials and business people laughed all the way to the bank: they not only benefited from control over Palestinian commerce but also from external aid flows provided to the PA and to local NGOs by international funders. Adam Hanieh comments: “The West Bank was a captive market for many Israeli goods—and because Palestinian consumption was essentially funded through external capital flows it was extremely profitable. Foreign aid to the PA, in other words, was as much aid to Israel as it was to the Palestinians”.37 Aid was also used instrumentally by Israeli officials, who channelled external funding through approved channels, privileging certain Palestinian recipients—most obviously those closely associated with the PA, the Israelis’ new partner in crime.


Leaders of Fatah had for decades been criticised by radical activists in the Palestinian movement for elitism, authoritarianism and their cosy relations with the Gulf regimes. They were not, however, routinely accused of misconduct by misuse of the movement’s resources. Although they interacted with wealthy Palestinians, and with the region’s kings and presidents, for decades senior PLO officials lived modestly.38 Arafat in particular was praised for an austere lifestyle consistent with his image as “Mr Palestine”. The Oslo agreement and establishment of the PA brought rapid change.

After the occupation of the West Bank in 1967 a priority for Israeli strategists had been identification of local collaborators through whom they could mediate relations with the local population. They established a Palestinian bureaucracy that worked with the Israeli army, a civil administration that included local police forces, and Village Leagues in which locally raised militias were encouraged to contest PLO influence. These did not succeed in undermining the national movement—as demonstrated dramatically in 1987 when the intifada produced a new generation of activists committed to revitalising the struggle. They did, however, set out an initial blueprint for relations between a privileged layer of Palestinians, the Israeli military administration and Israeli businesses which profited directly from the occupation. With the Oslo deal this core group expanded, attracting “returnee” capital, including members of the Palestinian bourgeoisie in the Gulf, and members of the traditional landowning class who had managed to retain their holdings.39 Just five years after the Oslo deal Jamil Hilal noted the changing economic environment: “growing influence of the World Bank…with emphasis on the private sector under the ethos of ‘structural adjustment’”; socio-economic inequality was certain to widen quickly, he suggested.40 The neoliberal agenda, combined with Israel’s new policy of closure of the West Bank and Gaza, had just this effect, enriching a minority of Palestinians associated with the PA, while the majority experienced a further sharp deterioration in their circumstances.

In 1993 Israel placed new controls on employment of Palestinians in Israel. For over 25 years Palestinian labour had been integral to the Israeli economy: it had also facilitated control by Israeli officials over life in the West Bank and Gaza. Leila Farsakh comments that migrant labour “anchored Palestinian dependence on Israeli goods and trade relations and tied the absorption of the Palestinian labor force to Israeli demand for Palestinian goods and services”.41 In 1992 the Israeli authorities had issued 115,000 work permits for routine entry; by 1994 (after Oslo) the number was 65,000;42 by May 1996 it was a mere 36,000.43 Numbers subsequently rose but again fell back as Israeli strategists targeted new sources of cheap labour. Michael Ellman and Smain Laacher note “a clear and open policy of substituting Palestinian workers with a workforce from overseas”.44 Consistent with developments worldwide in an era of deregulation and mobility of labour, Israel solicited immigrant workers from Asia and Eastern Europe. Initially more costly than Palestinians, they could soon be made “illegal” and highly exploitable—irresistibly attractive to certain employers.45 Unemployment in the Palestinian territories rose accordingly: from 15.1 percent to 32.5 percent between 1993 and 2000 in Gaza, from 10.1 percent to 23.8 percent in the West Bank,46 and there was an abrupt rise in levels of poverty and other indices of social deprivation.

The PA leadership was focused on other issues, most importantly the construction of a security apparatus to police the Territories and to assure its own protection. Despite the authoritarian tendencies of the Fatah leadership, since the 1960s the PLO had contained a wide range of political currents including groups such as the PFLP and the Democratic Front for the Liberation of Palestine (DFLP)—radical nationalists formally committed to principles of democratic socialism. The intifada of 1987 brought to the fore grassroots organisations including women’s, students’ and peasants’ groups, village councils, trade unions and independent cultural initiatives. Israel and the US used the Oslo Accords to install Palestinian forces that would suppress this movement, especially its radical elements, reducing “contagion” effects in the region. As the Israelis vacated military barracks and police stations in areas under direct Palestinian control, Palestinian security forces moved in. The PA constructed a multi-agency apparatus of uniformed police and plainclothes “intelligence” sections, of which the most important was the Preventive Security Service (PPS). Tens of thousands of men were recruited: in the mid-1990s the PA’s police chief suggested that 40,000 would eventually be needed;47 ten years later between 50,000 and 70,000 men had been enlisted.48 In the West Bank the PPS was commanded by Jibril Rahjoub (Abu Rami), in Gaza by Mohammed Dahlan (Abu Fadi), each using men trained by the CIA in camps in Egypt and Jordan with arms supplied by the US through Israel.49 They were soon making arbitrary arrests, imprisoning detainees without charge, torturing prisoners and closing independent publications and organisations. As new enforcers for the PA leadership they moved quickly, observed Graham Usher, “to overtake and then suborn the existing and emerging political and civilian orders in the West Bank and Gaza”.50

The PA elite was soon at the centre of a nexus of privilege. Working with the Israelis, senior PA officials allocated contracts for civil works and for the monopoly supply of key goods, distributed franchises for mobile phone companies and television broadcasters, and used their control over the legal system to allocate precious land resources. Businesses considering investment in the Territories were directed to PA officials, with the result that some senior PA men not only became immensely wealthy through their income as gatekeepers but also established or re-established relationships with Gulf capital and with the Gulf states. Mohammed Dahlan, chief PPS enforcer in Gaza, worked closely with investors and top officials in the United Arab Emirates: within ten years of the Oslo agreements he was said to have personal wealth of over $120 million.51 In 2003 an IMF audit of the PA budgets suggested that between 1995 and 2000 some $900 million of PA income was directed into “special accounts” controlled by Arafat and his chief economic financial adviser and used for investment in Palestine and abroad.52 Arafat continued to live modestly but other PA leaders engaged in conspicuous consumption that flaunted new-found wealth amid general deprivation. New residential areas were constructed, notably in Ramallah, where the “abus”—leading figures in the PA—built villas in secure areas that echoed the gated communities of elite residential zones across cities of the Global South. There was a corrosive effect on the whole national movement. Lamis Andoni, a veteran Palestinian journalist, noted that even revered young leaders of the first intifada were affected, coming under the influence of corrupt officials who insisted that their “nationalist credentials” were no longer important, as new “rules of the game” were dictated by money and by influence in the PA’s security state.53


Living standards of the mass of people were collapsing. Between 1999 and 2007 Palestinian GDP per capita fell by two thirds; some 56 percent of households in the West Bank and 75 percent in Gaza fell below the poverty line—the highest levels on record.54 Closures, relentless colonisation and repeated military interventions by Israel were accompanied by widespread immiseration. In 2000 a second intifada erupted. This was a further sustained mass upheaval but lacked the energies of the 1987 movement and soon became focused on armed confrontation with Israeli forces—an unequal contest in which there could only be one outcome. In 2000 Israel also began construction of its apartheid wall, further isolating scores of Palestinian communities, rendering inaccessible vital areas of agricultural land and disrupting communication across the fragmented PA territories.

Fatah was now rapidly losing support to the Islamists of Hamas.55 Founded in 1987 in Gaza by an activist faction of the Muslim Brotherhood, Hamas had come to prominence during the first intifada. Initially it was favoured by the Israelis; concerned above all by the problem of the PLO, they allowed the Islamists space to develop in the hope that they would draw support away from secular nationalism.56 During the 1990s the organisation steadily expanded its base in Gaza and in the West Bank, developing welfare projects typical of the Brotherhood’s populist strategy and contesting the PA’s accommodation with the Israelis. Glenn Robinson tracks its success as the realities of the Oslo process began to sink in:

[As] Oslo failed to deliver Palestinian rights, Hamas’s star rose and its opportunities for action increased. Israeli reluctance to fully end its occupation of the West Bank and Gaza strengthened Hamas, which had predicted Oslo’s failure from the start, and made it the only significant opposition movement in Palestine… Hamas became a political home to those who were disillusioned by Oslo.57

Soon characterised in Israel as “Islamo-fascist” and said to be part of a global Muslim threat, the organisation was in fact limited in aims and pragmatic in practice. It shared the narrow nationalism of Fatah. Its founder Shaikh Yassin insisted: “We in Hamas: our battle is on the Palestinian land. We are not ready to move our battle out of the occupied territories”.58 Its key slogan, “Islam is the solution”, originated with the Brotherhood and could be used to suit all purposes. For several years Hamas opposed all notions of compromise with Israel; by 2004, however, it was ready to negotiate alongside Fatah and to halt its armed operations. For several years it also refused to participate in PA elections; changing policy, it soon scored a stunning electoral success.

Arafat died in 2004, succeeded by Mahmoud Abbas (Abu Mazen), a founder-member of Fatah who had been a senior bureaucrat in Qatar long committed to normalisation of relations with Israel. In 2006 Hamas won elections for the PA’s Legislative Council, its Change and Reform list capturing 74 out of the 132 seats, and Hamas leader Ismail Haniya became prime minister. The Israelis were appalled and the US attempted a coup against Hamas in Gaza, led by Mohammed Dahlan.59 When this backfired, Hamas succeeded in driving Fatah forces from the territory. There were now two separate Palestinian authorities, with Hamas in control in Gaza and the PA under Abbas continuing in power in the West Bank. Israel promptly sealed Gaza and in December 2008 launched a massive assault on the territory. None of these developments inhibited the neoliberal programme and the PA’s collaborative links with Israel. In 2007 Abbas appointed Salam Fayyad as prime minister. An economist, Abbas had been IMF representative to the PA through the 1990s: he was the favoured candidate of Israel and the US and the architect, together with the World Bank, of a new Palestinian Reform and Development Plan (PRDP). This set out proposals to accelerate marketisation:

The Palestinian economic vision is to have a diversified and thriving free market economy led by a pioneering private sector that is in harmony with the Arab world, is open to regional and global markets, and that provides the economic basis for a free, democratic and equitable society.60

Neoliberal reform was pursued with zeal. Under “Fayyadism” the West Bank was to be integrated into imagined networks of global prosperity. There were soon superficial changes: the construction of shopping malls, hotels, restaurants and luxury car showrooms, and of fully fledged gated communities, notably Rawabi, advertised as “the first Palestinian planned city…the largest private sector project ever carried out in Palestine”.61 This hilltop town for the new rich, financed by Qatari speculators and built in the image of Israel settlements, used land confiscated from local villages under compulsory purchase decrees personally signed by Abbas. Land was also seized from West Bank farmers to establish industrial zones, some run by external operators such as the Turkish TOBB-BIS development group. The aim was to introduce QIZs like those nearby in Jordan, where mainly migrant workers were employed at rates below the minimum wage, forbidden to join unions and excluded from the national social security system. Charlotte Silver describes the West Bank zones as a strategy for “outsourcing Palestine”.62 QIZs also offered opportunities to establish joint venture enterprises with Israeli companies—a PA version of the agro-industrial parks in Israeli settlements in which Palestinian businesses had already made investments.63 According to Tariq Dana, Palestinian companies have even been involved in laundering products made in Israeli settlements, fraudulently branding these as “products of Palestine” for export to Europe, with the aim of evading boycott campaigns and regulations in some European countries.64

A development “bubble” in the West Bank, during which construction and consumer spending rose sharply, was financed by huge rises in mortgage debt and personal credit. Palestinians have traditionally been averse to debt: between 2008 and 2011 consumer credit in the West Bank increased sixfold, reaching $415 million; by 2012 credit for land purchase and construction exceeded $500 million, most facilitated by American and Gulf banks.65 By 2013, 75 percent of public sector employees in the West Bank were said to be in debt.66 The PA was meanwhile unable to meet its own debt repayments and often unable to pay the salaries of its employees. By 2012 unemployment across the Territories had risen to 27 percent and real wages were 10 percent lower than in 2006.67 The PA continued undeterred. It had willingly become a creature of US strategists, international financial organisations and Israel’s politicians and business leaders.

Palestine for sale

The PA had been fully integrated into plans for regional change in which dominant states, international corporations and banks set the agenda. As in neighbouring Egypt, everything was up for sale. Under the regime of Hosni Mubarak, Egypt had passed through successive waves of marketisation and deregulation during which state assets were sold off in corrupt deals to local businesspeople and foreign investors. Eventually everything once viewed as a national asset was available—land, water resources, power generation, manufacturing industry, agricultural services, banks—anything that could be “marketised” and passed into private hands to the benefit of Mubarak and his favoured supporters.68 A similar programme, less intensive but with like outcomes, had been pursued in Syria.69 In the case of Palestine partisans of neoliberalism were presented with a unique opportunity.

Under Israeli occupation the West Bank and Gaza could be treated much as European powers had earlier operated in the “colonial world”. A military machine was available to suppress local resistance and an increasingly tame nationalist leadership was open to solicitation. Regional capital in the form of the Gulf regimes was keen to engage, with a view to extending its reach and taming the troublesome Palestinian resistance. The Oslo Accords placed a Palestinian leadership keen to play a full role in this project in formal control of the Territories.

Fatah had been established in the 1950s with aspirations to secure a state that would be symmetrical with other states of the Arab world. In mobilising for collective struggle, however, it had engaged with the Palestinian masses, whose aspirations shaped a different agenda—one influenced by hopes for change that reflected struggles across the Middle East. As expressed initially in the 1950s and 1960s in the radical nationalism of the Free Officers movement in Egypt, in revolutionary upheavals in Iraq, and in anti-colonial movements in Algeria and Yemen, this focused upon political independence and on economic and social reform including nationalisation of land, industry, finance and commerce. Rashid Khalidi comments: “Even in the exile of the refugee camps of Lebanon, the PLO found it difficult to resist pretensions to ‘national’ state-building goals”.70 The rise of this movement pushed Fatah to the left, so that its leaders undertook to mobilise national resources in the interests of the masses. It built a system of social welfare (initially in Jordan and Lebanon) with schools, clinics and hospitals, and trade unions that represented Palestinian workers within the context of the national movement. Its modest industrial initiatives, conducted through the Samed organisation, were said by Arafat to constitute “the core of the independent Palestinian economy and of a Palestinian public sector liberated of bureaucracy and infused with the determination and spirit of revolution”.71 The PLO maintained an expectation (never set out formally) that return to Palestine would involve the mobilisation of the country’s material assets—land, water and minerals—as resources to be used as part of an embracing project for national development. After Oslo the PA abandoned these approaches. It shared with the post-Nasserists of Egypt and with other ruling classes of the region a commitment to neoliberalism in which resources held by the state notionally on behalf of the people were to be mobilised through the market and to its own benefit. In doing so it raised to a new level of significance the issue of social class in the Palestinian experience.

The PLO had never engaged with mass struggles in the region: on the contrary, its leaders worked energetically to draw Palestinians away from opportunities to assert common interests vis-a-vis Israel, imperialism and the region’s ruling classes. Fatah was for decades of the Palestinian movement without being for the mass of its participants. At key moments, notably in 1970 (in Jordan) and 1987 (during the first intifada), it rejected opportunities to advance Palestinian interests as part of movements for radical change. Fatah leaders emphasised national unity: a legitimate project in the context of contesting Israeli colonialism but one that, given determinative status, subverted Palestinian capacities to solidarise with such movements and their potential to challenge the ruling classes of the region, including that in Israel. When the PA moved into open alliance with Israel, the US and the neoliberal project, the idea of unity at any cost, long challenged by Palestinian radicals, finally broke down irreparably. Now it was the PA that seized land, evicted peasants and suppressed and silenced dissidents. For many Palestinians, argues Tariq Dana, the PA security apparatus became “an extension of the occupation. In reaction to PA actions, critics now regularly level charges of treason and betrayal”.72

The crisis of mainstream nationalism was expressed in many ways, among which the most significant was an attempt by grassroots activists to break Palestinian isolation and the hold of the traditional leadership through the Boycott, Divestment and Sanctions movement (BDS). Launched in 2005, BDS bypassed the PLO, described by campaigner Omar Barghouti as “in total disarray for years” after reducing the Palestinian cause to “a hollowed-out process of co-existence with Israel injustices”.73 BDS spread rapidly, facilitated by creative engagement with the global movement for social justice, especially the networks of the World Social Forum. Hundreds of organisations in the Occupied Territories backed its declaration and many engaged with trade unions, religious bodies, student groups and solidarity campaigns abroad, establishing relationships that began to reduce Palestinian isolation. As Fatah struggled to contain Palestinian struggles they were being projected for the first time to a large global audience.


In the 1950s Fatah had hoped to establish an independent state that would be part of the region’s capitalist order. By the 1990s it had surrendered the national movement to obtain a shadow state in a fraction of historic Palestine. Here it confronted a mass of people whose interests were shaped more and more by the struggle against a restructured capitalism, dominated by the neoliberal agenda. The national question was being integrated into common struggles against corporate capital, international finance and neo-imperialism under the leadership of Washington and the Gulf states. Together with their experiences of dispossession, displacement and decades of Israeli colonisation, Palestinians had been inserted fully into the politics of class antagonism.

This was the situation in 2011 when a mass movement in Egypt removed Mubarak. Most Palestinians reacted with delight, celebrating the end of a hated dictator brought down by popular opposition in which mass strikes played a decisive role. The Electronic Intifada reported from Gaza:

“Masr, Masr, Masr, Masr”—the Arabic word for Egypt was the call from huge crowds on the streets of Gaza City… The length of Umar al-Mukhtar street, a main thoroughfare in Gaza City, presented a beautiful portrait of black, red and white, the colors of hundreds of Egyptian flags emblazoned with a golden eagle, as many people shared sweets and watched fireworks.74

Borrowing the slogans of Tunis and Cairo, Gazans shouted: “The people want to bring Abbas down”.75 In Amman, a city largely populated by people of Palestinian origin, slogans included: “Long Live Egypt!”, “Who’s next?”, “Tomorrow Abbas!”.76 Palestinian activist and writer Ali Abunimah observed:

The revolution has reawakened a sense of a common destiny for the Arab world many thought had been lost, that seemed naive when our mothers and fathers told us about it from their youth, and that Arab leaders had certainly tried to kill. The Arab dictators…thought their peoples’ spirits were dead too. The revolutions have restored a sense of limitless possibility and a desire that change should spread from country to country.77

The Palestinian struggle was at a critical juncture—a moment when its isolation was broken by movements that challenged the region’s embedded power structures. “A sense of common destiny” united Palestinians and people in the streets and workplaces of Tunisia and Egypt.

In the West Bank, Palestinians were at first more circumspect. Mahmoud Abbas had telephoned both Mubarak and President Ben Ali of Tunisia to offer support and instructed police to attack demonstrators in Ramallah who supported the uprisings—unequivocal statements of the PA’s attachment to the dictatorships and of contempt for the mass movements. But as a mood of celebration spread Abbas panicked, asking his entire cabinet to stand down and announcing presidential elections. At the same time he mobilised PA security forces: his survival depended on joint action with Israel to contain the local movement. For months Palestine was on the brink. In June 2011 Israeli officials described a “nightmare scenario” in which Israel’s borders with Egypt, Jordan, Syria and Lebanon became areas of confrontation as Palestinians converged in a “border intifada”.78 Abbas hung on, however, and Israel was able to contain incursions from Syria when thousands of Palestinians attempted to cross the border.

Of critical importance were events in Egypt, where countless demonstrations demanded action for Palestine, insisting that the SCAF military government that had succeeded Mubarak cancel treaties and trade agreements with Israel and open the border with Gaza. In September 2011 large crowds stormed the Israeli embassy in Cairo and Israel evacuated its diplomatic staff. Still SCAF did not respond and when the Muslim Brotherhood won a parliamentary election in December 2011 it too declined to act. The Brotherhood’s sister organisation in Gaza, Hamas, had greeted the fall of Mubarak as “the start of the victory of the Egyptian revolution which we support with all its demands”.79 It now discovered that the Brotherhood, paralysed by the prospect of challenging Egypt’s army as the key power base within the state, was unable to act. When its candidate Mohammed Mursi was elected president in June 2012 the Brotherhood entered a mode of denial in relation to Palestine. Notwithstanding its long historic commitment to the Palestinian cause, the Brotherhood abandoned Gaza to its fate. Egypt’s secular opposition parties proved no more effective. Despite repeated commitments to the Palestinian cause, liberals and nationalists also walked away from Gaza and the wider question of Israeli occupation. In 2012 Nasserist presidential candidate Hamdeen Sabbahi declared that if elected he would tear up Egypt’s peace treaty with Israel, that he would support the Palestinian resistance and would refuse to recognise a Zionist nation that usurped Arab land.80 After a campaign in which he captured the support of millions of Egyptian workers and revolutionary activists he retreated into silence. Like the Brotherhood and other members of the secular opposition, including liberals, social democrats and Communists, Sabahi was paralysed by the challenge of confronting the army as command centre of the Egyptian state. Deferring to the armed forces as an embodiment of national interests and historic representative of “the people”, nationalists and Communists marked by perspectives of the Stalinist era sought accommodation with the officer elite—their own betrayal of radical activists in Palestine. When General Abdel-Fattah el-Sisi stormed to power in July 2013 Palestine’s most committed supporters in Egypt were driven from the streets.

Palestinian activists lamented a “lost Arab Spring”.81 In 2014, after Israel again savagely attacked Gaza, even the Israeli press acknowledged their distress, Haaretz commenting on Palestinians’ “bewilderment and anger that a country [Egypt] they regarded as an ally has left Gaza to burn”.82 Historic changes are under way, however. There is now much stronger identification of Palestinian interests with those of mass movements in the Arab states—the most important development in the Palestinian struggle for over 50 years. As Ali Abunimah has insisted, “the revolutions have restored a sense of limitless possibility and a desire that change should spread.” The ruling classes of the region have unified around the neoliberal agenda: the issue for Palestinians, Egyptians and others determined to bring such change is how to establish political currents committed to revolutionary transformations and to freedom for Palestine.


1: Thanks to Anne Alexander, Alex Callinicos, Ellie Marfleet, John Rose and Alan Watts for comments on this article in draft.

2: Ma’an News, 2014.

3: Faheem and Thomas, 2014.

4: Mozgovaya/Haaretz, 2011.

5: Benn, 2010.

6: Benn, 2010.

7: Barghouti, 2011, p56.

8: Khalidi, 2014.

9: Khalidi, 2014.

10: Nakba-Arabic, disaster/catastrophe-used widely in the Arab world to refer to the Arab-Israeli conflict of 1948 and the displacement of the Palestinians.

11: Ibrahim, 1982, p48.

12: Fatah or Fath is a reverse acronym of Harakat al-Tahrir al-Watani al-Falastini, the Palestinian National Liberation Movement. It has Quranic implications as “the opening” or “the victory”.

13: On the development of Fatah’s political strategy and the principle of non-interference see Schulz, 1999.

14: Hart, 1989, p157.

15: The Syrian, Iraqi and Libyan states backed a range of groups within the PLO. The Syrians eventually sponsored several factions, including Al Saiqa, the Popular Front for the Liberation of Palestine-General Command, the Palestine Liberation Front and the Palestinian Popular Struggle Front.

16: Hart, 1989, p286.

17: Hart, 1989, p286.

18: For a fascinating account of developments in Lebanon see Sayigh, 1979.

19: Leading Palestinian nationalist figures have routinely been referred to in the movement by their nom de guerre, usually their kutba, or tekonym-a reference to their eldest child (so Abu Daoud, Father of Daoud).

20: Hart, 1989, p304.

21: Rabbani and Hajjar, 1988, p26.

22: Johnson and O’Brien, 1988.

23: Hanieh, 2013, p105.

24: Johnson and O’Brien, 1988.

25: Mideast Mirror, 1988b.

26: Mideast Mirror, 1988a.

27: Marshall, 1989, pp167-168.

28: Mideast Mirror, 1988c.

29: The PA had “direct” control over a mere 3 percent of the territory of West Bank, with some 20 percent of the Palestinian population (Area A); the PA and Israel jointly controlled 24 percent of the territory and 70 percent of the Palestinian population (Area B); and Israel retained full control of 70 percent of the territory (Area C), in which there were 227 isolated pockets of Palestinian territory. See Gorenberg, 2007, pp370-373; Hanieh, 2013, pp107-109.

30: Central Bureau of Statistics, Statistical Abstract of Israel, 1992-2006 and List of Localities, the Populations, and Symbols, 1995-2005. Statistical Yearbook of Jerusalem, Jerusalem Institute for Israel Studies, 1991-2004, cited in FMEP (Foundation for Middle East Peace), 2007.

31: BBC News, 1998.

32: Yiftachel, 2005, p128.

33: Quoted in Davidi, 2000.

34: Soon established in Egypt and Jordan, the QIZs facilitated export to the US of manufactured goods without tariffs, provided they contained a defined Israeli input.

35: Hanieh, 2013, p104.

36: Hanieh, 2013, p110.

37: Hanieh, 2013, p110.

38: When I interviewed Khalil al-Wazir (“Abu Jihad”-a historic leader of Fatah) in Tunis in 1984 he was living below the radar in a small, poorly furnished house outside the city. He was killed there by an Israeli commando team in 1988. Salah Khalaf (“Abu Iyad”) met the same fate in Tunis in 1991.

39: See Hanieh, 2013; Abunimah, 2014.

40: Hilal, 1998, p124.

41: Farsakh, 2002, p13.

42: Ellman and Laacher, 2003, p11.

43: Farsakh, 2002, p13.

44: Ellman and Laacher, 2003, p39.

45: Within 10 years some 300,000 workers had been recruited from these sources, of whom 200,000 lost their permits, becoming technically illegal-Ellman and Laacher, 2003, pp7, 19.

46: Farsakh, 2002, p20.

47: Usher, 1998, p148.

48: Usher, 2006, makes this informed estimate.

49: El Fassed, 2006; Rose, 2008.

50: Usher, 1998, p155. Israeli prime minister Yitzak Rabin told the newspaper Yediot Aharanot (7 September 1993): “The Palestinians will be better at it than we were”, adding: “they will rule by their own methods, freeing, and this is most important, the Israeli army soldiers from doing what they will do.” Quoted in Usher, 1998, p154.

51: Kuttab, 2013.

52: International Monetary Fund, 2003.

53: Andoni, 2004.

54: Hanieh, 2013, p116.

55: Hamas-an acronym of Harakat al-Muqawamah al-’Islamiyyah, the Islamic Resistance Movement, in Arabic meaning “enthusiasm” and more accurately translated in the political context as “zeal”.

56: Robinson, 2004.

57: Robinson, 2004, pp125-126.

58: Milton-Edwards and Farrell, 2010, p163.

59: See the “Palestine Papers”-Rose, 2008.

60: Palestinian National Authority, 2007, p19.

61: Go to

62: Silver, 2012.

63: Dana reports evidence from the PA Ministry of Economy that Palestinian businesses have been investing in Israeli settlements in the West Bank and Jordan valley-Dana, 2014a.

64: Dana, 2014a.

65: Abunimah, 2014, p85.

66: Dana, 2014a.

67: UNCTAD (United Nations Conference on Trade and Development), 2013, p6.

68: Marfleet, 2013.

69: Hinnebusch, 2012. There was also a more tepid attempt in Jordan: see Baylouny, 2008.

70: Khalidi, 2014.

71: Quoted in Khalidi, 2014.

72: Dana, 2014b.

73: Barghouti, 2011, pp56-57.

74: Almeghani, 2011.

75: Almeghani, 2011.

76: Abunimah, 2011.

77: Abunimah, 2011.

78: Naami, 2011.

79: Yaghi, 2011.

80: United Press International, 2012.

81: Al-Ghoul, 2013.

82: Diab, 2014.


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