How Israel Won the War and Defeated the Palestinian Dream

Israeli border police in Jerusalem guard what Jews call the Temple Mount and Muslims call the Noble Sanctuary. Violence has flared at the holy site. Heidi Levine

It was the end of Ramadan, a few days before Eid al-Fitr, a time of feasts and family. But the housewives shopping in a Gaza City market were buying just a few handfuls of vegetables and small pieces of meat. "Nobody can use their refrigerators," one vendor explains; the power is out for much of the day, and food spoils quickly here. It was the start of a typically harsh summer, with daytime temperatures in the 90s, and in one office after the next, politicians and professors apologized to visitors for the heat—their air conditioners were useless.

After three wars and a decade-long military blockade, Gaza's nearly 2 million people are familiar with hardship. This summer's power crisis is merely the latest in a long list of shortages of everything from drinking water and cooking gas to cement and cars. But this time, one thing is different: The problem has been created by other Palestinians.

Until recently, Israel provided Gaza with about half of its electricity, paid for by the Palestinian Authority, the internationally recognized body that governs the West Bank. But in April, Mahmoud Abbas, the Palestinian president, decided to reduce those payments by 40 percent, and on June 11, at the request of the PA, the Israeli security Cabinet approved a commensurate cut in the supply. Most Gazans received just four hours of electricity at a time, followed by 12-hour blackouts; now, they get about two and a half hours at a stretch.

Related: Israel's ultra orthodox problem

A Palestinian boy in Gaza City, where power outages have been common. Many young Palestinians have given up on the two-state solution and now see the struggle as a civil rights movement. Ali Jadallah/Anadolu/Getty

The reduction was partly an effort to win favor with Donald Trump. Abbas has been eager to establish a good relationship with the new American president, who has repeatedly said he wants to strike the "ultimate deal" between Israel and the Palestinians. Trump tasked his longtime corporate lawyer, Jason Greenblatt, and his son-in-law, Jared Kushner, with reviving the moribund peace process between the two parties. Abbas hoped that imposing sanctions on Gaza, which is controlled by the militant Islamist group Hamas, would boost his standing. "He believes this is his last chance for a two-state solution," says Salah al-Bardawil, a member of the organization's politburo. "So he's in a rush to show Trump that he's against terrorism."

But Trump's efforts have already collided with the realities on the ground: a hawkish government in Jerusalem and a divided, unpopular Palestinian leadership. Kushner made a quick trip to the region in mid-June to meet with leaders on both sides. In the days before and after his visit, Israel announced plans to build 7,000 new homes in occupied East Jerusalem and broke ground on a new settlement in the West Bank, the first in more than two decades. Arabic media reported that Kushner's talks with Abbas were "difficult," and that Trump might abandon the effort. Even if he plows ahead, few observers expect him to succeed.

By midsummer, the Palestinians were publicly frustrated with what they viewed as the pro-Israeli slant of Trump's top aides. But Abbas did not abandon the electricity cuts, nor his decisions to halt shipments of medicine to Gaza and reduce the salaries of tens of thousands of civil servants there. They were more than just geopolitical ploys; they were also parts of a long-running internal Palestinian battle—one that now consumes more of their attention than the fight against Israel.

As Samir al-Ajla, a resident of eastern Gaza, puts it: "I never thought the one making my life difficult would be another Palestinian."

Broken Bones and Shattered Dreams

A Palestinian protester clashes with Israeli soldiers in a village near the West Bank city of Nablus. Though Israel’s status as a Jewish and democratic state in the very long term is still imperiled, five decades after the occupation began, the Palestinian national movement has been largely defeated. Jaafar Ashtiyeh/AFP/Getty

The Palestinians, living under occupation or scattered across the diaspora, have long been the weaker party in the conflict with Israel. For decades, though, they were able to put up a costly fight. In the years after the Six-Day War in 1967, they did so from exile in Beirut, Amman and Tunis, a militant campaign that caused chaos across the Arab world and even spilled into Europe. The climax came in the late 1980s, with the start of the first intifada, a homegrown movement of mass protests. Israel responded with brute force, killing and wounding thousands of demonstrators—what then–Defense Minister Yitzhak Rabin called its "broken bones" policy. This drew sharp criticism from abroad and helped spur a diplomatic process that culminated in the mid-1990s with the Oslo Accords, which granted the Palestinians a measure of self-governance.

Oslo was meant to last for five years, an interim step toward a final peace agreement. But optimism soon collided with the second intifada, a grisly campaign of suicide bombings that silenced the peace camp in Israel. From there, the Palestinian strategy diverged. Hamas fought three wars. Young Palestinians carried out hundreds of lone wolf attacks in the West Bank, East Jerusalem and Israel. The PA, meanwhile, waged a diplomatic battle against Israel, joining the International Criminal Court and winning recognition from the United Nations and a number of European states.

Yet none of these moves forced Israel to make concessions. Over the past decade, Palestinians have killed about 200 Israelis, less than half the number they killed in a single year, 2002, at the height of the second intifada. Lawmakers treat the violence as inevitable. Even at the peak of the last Gaza war, the largest pro-peace rally in Tel Aviv attracted a scant 5,000 protesters. Nearly half a million Israelis, by contrast, turned out in the summer of 2011 to protest the high cost of living. Meanwhile, Abbas's diplomatic efforts haven't amounted to much: Joining the International Convention Against Doping in Sport has not, it seems, placed any meaningful pressure on Israel.

Israeli tanks return from the Gaza Strip.
Israeli tanks near the border between Israel and the Gaza Strip on August 5, 2014. THOMAS COEX/AFP/Getty Images

Instead, the Palestinians have spent the past 10 years fighting among themselves. Both Hamas and its secular rival Fatah run their territories like police states, harassing and jailing journalists, activists and even ordinary citizens who post messages critical of them on Facebook. (Most of the Palestinians interviewed for this story asked for anonymity—because they fear their own governments.) A decade after their mandates to rule expired, neither side wants to hold elections. Far from achieving a two-state solution, they have created a three-state reality: two dilapidated statelets dominated by a strong, prosperous Israel.

And though in the very long term, Israel's status as a Jewish and democratic state is still imperiled, five decades after the occupation began, the Palestinian national movement has been largely defeated. "I find it hard to say as a Palestinian, but we haven't achieved any of our national goals," says Mkhaimer Abu Saada, a political analyst in Gaza. "Our leadership has failed to achieve anything."

Mortgaging the Next Intifada

The father of a Palestinian teenager who stabbed three Israelis to death in the West Bank settlement of Halamis holds up his photo. Heidi Levine for Newsweek

In April, thousands of Palestinian prisoners in Israeli jails started a hunger strike, the largest such mass demonstration in years. It was organized by Marwan Barghouti, a prominent Fatah leader, to demand better conditions: extra family visits and access to pay phones. Israel vowed not to negotiate. At one point, the Israeli Prison Service even set up a sting, planting cookies and candy bars inside Barghouti's cell, then filming as he noshed in the bathroom. Yet the video did little to dent his popularity—some Palestinians dismissed it as a fake, others as a dirty trick.

As the protest wore on, Israeli officials worried that reports of sick or dying inmates would spark unrest in the occupied territories. The Palestinians had timed the climax of the hunger strike to coincide with both Ramadan, when tensions often run high, and the 50th anniversary of the occupation. So on May 27, after lengthy negotiations, the detainees announced a deal. They stopped their fast after securing a second monthly family visit. The families of prisoners celebrated on the streets of Ramallah, where Barghouti won praise for defending the "dignity" of his fellow inmates. "You'd think we just liberated Jerusalem," quipped one Palestinian journalist.

But even this victory was a defeat for the PA. Until the summer of 2016, prisoners were entitled to two family visits. It wasn't Israel that reduced the number. It was the Red Cross, which coordinates the trips and wanted to cut costs, mostly related to busing. The money to pay for the extra visit will come from the Palestinian Authority, which is already struggling to close an $800 million gap in its annual budget. Abbas had been privately fuming about the hunger strike, fearing it would undermine his efforts to ingratiate himself with Trump. On his visit to the region in May, the American president unexpectedly canceled a visit to the Church of the Nativity in Bethlehem, fearing he would bump into a crowd of prisoners' mothers holding a sit-in nearby. So the Palestinian president ponied up the cash.

Abbas, 82, took office in 2005 for what was officially a four-year term. He is still in power, with no plans to resign. He's overweight, a heavy smoker who has undergone two heart surgeries, yet has done almost nothing to plan for a successor. Nor does he have many good choices. His deputy, Mahmoud Aloul, is a little-known apparatchik chosen for his loyalty. Another contender, Jibril Rajoub, is a former secret police chief more beloved by Israeli generals (for his work to arrest Islamists) than by Palestinian voters. The most popular candidate, Barghouti, is serving five life sentences for organizing deadly attacks during the second intifada.

Donald Trump Mahmoud Abbas
U.S. President Donald Trump shakes hands with Palestinian President Mahmoud Abbas as they deliver a statement at the White House in Washington D.C., U.S., May 3, 2017. REUTERS/Carlos Barria REUTERS/Carlos Barria

Abbas is quick to fire and ostracize anyone who becomes too critical, so his challengers do not offer much public dissent. "We need Abu Mazen," says Rajoub, the No. 3 man in Fatah. "He's the only one who can sign, or will sign, a [peace] deal. He's important to everybody, to Israel, to the U.S., and he's still working hard." One important group disagrees: his constituents. Two-thirds of them want him to resign. A slim majority also supports dissolving the Palestinian Authority, widely viewed as little more than a subcontractor for the Israeli occupation.

On May 13, the Palestinians held a much-hyped municipal election in the West Bank. It was their first vote in five years, and officials hoped it would generate enthusiasm. Palestinians weren't interested. Fatah ran almost unopposed because Hamas and other factions decided to boycott the election, but the secular group nonetheless failed to win a majority in major cities like Hebron, where its candidates picked up just seven of 15 seats. Turnout was a paltry 53 percent compared with more than 70 percent in ballots a decade ago. "Palestinians are no longer interested in politics," says Abu Saada. "Why would they be?"

They have more pressing concerns. More than three-quarters of Palestinians feel their government is corrupt. Asked to name the biggest problem in society, a majority of respondents choose internal ones: poverty, unemployment, corruption and the political schism between Hamas and Fatah. Just 27 percent say the occupation is their largest concern, according to the Palestinian Center for Policy and Survey Research, the top pollster in the territories. The official unemployment rate in the West Bank is 16 percent, and roughly one in five families lives in poverty. (The actual figures are thought to be higher.) Yet the streets of Ramallah are lined with billboards advertising million-shekel apartments. A tenuous middle class has loaded up on consumer debt, which soared from $1.3 billion in 2012 to $2.2 billion just three years later. All of this has served to make Palestinians more risk-averse. The way a CEO of a major bank in Ramallah sees it: "You're not going to join an intifada when you have to make mortgage payments."

Three States, Two Peoples

A Palestinian woman in Gaza City during the 2014 conflict with Israel. After three wars and a decade-long military blockade, people here are familiar with hardship and suffering. Heidi Levine

At first glance, the Erez crossing into Gaza could be an airport terminal; it's a soaring structure with glistening windows and dozens of lanes to process travelers. On a typical day, though, only one or two lanes are open, staffed by desultory border guards flipping through paperback novels. A warren of narrow passageways takes you to the PA's Potemkin checkpoint on the other side (they have not actually controlled Gaza for a decade). And then, half a mile down a rutted road, you reach the real border post, where the Hamas police check your bags for smuggled alcohol.

The Islamist group seized power in Gaza in 2007, after a lengthy period of infighting that followed its victory in legislative elections the previous year. Since then, it has fought three wars against Israel. The most recent one, in the summer of 2014, dragged on for 51 days, far longer than anyone expected. It was devastating for the Palestinians: Israeli bombs killed more than 2,200 people, left 100,000 homeless and destroyed the strip's infrastructure.

But Hamas kept firing rockets until moments before the August 26 cease-fire. It counts the war as a victory, not because it achieved any of its strategic goals, but simply because it survived. The group speaks the same way about the broader situation in Gaza. Israel and Egypt's 10-year blockade has crippled the strip; most of its young inhabitants have never left the 140-square-mile territory. Yet it feels normal in a way that the West Bank, with its visible occupation, does not. There are no Israeli military patrols—no Israelis at all, just a handful of skeletal greenhouses, the remains of settlements that once dotted the area. "The expansion of settlements in the West Bank is because of the holy security cooperation with Israel," says Mahmoud Zahar, one of the co-founders of Hamas. "Since Hamas came to power in Gaza, Israel has not demolished a single home here."

It is an absurd argument, of course—Israeli jets and artillery have ravaged Gaza. Hanging on the wall of Zahar's salon, just yards from his chair, is a photograph of his son, killed in an Israeli airstrike on the family compound, which he has had to rebuild three times. Despite all of the hardships, though, Hamas claims it liberated Gaza from the occupation's daily indignities, and the group is loath to give up control.

A growing number of Gazans, however, don't feel liberated. In private conversations, the anger they once directed at Israel and Egypt is now aimed at their own leaders. They often have these conversations in the dark, owing to the lack of electricity. Tap water, when it is available, is undrinkable, brackish and polluted. About half of the population, and more than 60 percent of young people, are unemployed—the highest rate anywhere, according to the World Bank. More than 70 percent of Gazans rely on international aid to survive. In a courtyard outside Azhar University, recent graduates peddle cheap snacks and cigarettes to current students, who offer bleak predictions about their own futures: "I'll be here with my own cart next year," said one young man, a computer science student.

Hamas has always been divided between its hard-line military wing and its comparatively moderate political branch. The gulf has only widened in the three years since the last war. In early 2015, Ghazi Hamad, a pragmatic member of the Hamas politburo, penned an unusual op-ed entitled "How and Why the Arabs Lost Palestine." It was a rare act of self-criticism: Both Hamas and Fatah, he argued, were consumed with their own narrow interests, focused on preserving their fiefdoms rather than liberating Palestinians. "You will find that we disagree about everything, from the liberation or statehood project to the most trivial of issues," Hamad wrote. "This has dragged us into drowning in the small details."

In some respects, the military men seem to be winning. Hamas spent the early part of 2017 shuffling its leaders, for the first time in more than a decade. The new leader in Gaza—effectively the group's No. 2 man—is Yahya Sinwar, a hard-liner who spent decades in an Israeli jail. He helped to set up a unit that hunted down suspected "collaborators" with Israel, and allegedly killed some of them with his own hands. "He's a hard man," as one of his colleagues puts it.

Israeli soldiers arrest a Palestinian man in East Jerusalem. Despite a spate of knife and ramming attacks in recent years, Israel has largely grown accustomed to the periodic violence. And while lawmakers see more attacks as inevitable, they also feel the conflict can be “managed.” Heidi Levine

But Sinwar and his boss, Ismail Haniyeh, are taking control of a movement that has recently shown what many analysts call an unusual degree of willingness to compromise with Israel. In May, Hamas unveiled a new policy document meant to amend its 1988 founding charter. It dropped the worst anti-Semitic language from the original, which spoke of a war against the Jews, and it severed ties with the Muslim Brotherhood. Perhaps most significantly, it accepted the idea of a Palestinian state along the pre-1967 borders, describing it as a formula accepted by public consensus. It was not a complete reversal: The group still does not recognize Israel. Even some of the most hawkish Hamas leaders, though, recognize that a fourth war with Israel would likely end in catastrophe. "They understand that the next attack on Gaza might end, for them, the Hamas government in Gaza," says Amos Gilad, an official at the Israeli Defense Ministry. "That's very possible."

Related: Mohammed Dahlan dreams of Gaza

So there is a desire to avoid that next attack; there is serious talk of signing a lengthy cease-fire with Israel in exchange for a seaport, a step that would effectively end the blockade. Hamas has spent the past few years cozying up to Mohammed Dahlan, a former Fatah strongman who was once its greatest nemesis: His men were notorious for throwing Islamists off rooftops. He has since gone into exile in the United Arab Emirates, after running afoul of Abbas, and he now serves as a sort of diplomatic fixer for the Emirati royal family. Hamas believes he can deliver both economic investment and political legitimacy; his past transgressions are all but forgotten. "It was a difficult time," says Ahmed Yousef, a longtime member of Hamas. "He is rewriting his history, and Hamas has changed too."

A seaport, or any other meaningful steps to connect Gaza to the outside world, would cement a de facto three-state solution. It seems the opposite of what Islamist groups like Hamas have spent decades fighting to achieve—and yet they are enthusiastic about it. I ask Yousef whether his movement had simply become a bearded version of Fatah. He chuckles, and says, "You could say that."

Mismanaging the Conflict

Obama was so frustrated with Netanyahu, right, that he didn't veto a U.N. Security Council resolution that said Israeli settlements “have no legal validity.” Heidi Levine

In December, the Palestinians briefly had something to celebrate: The U.N. Security Council passed a resolution that said Israeli settlements "have no legal validity." It was a parting shot from then–U.S. President Barack Obama. After eight years of frustration with Prime Minister Benjamin Netanyahu, he decided to abstain rather than veto the measure. "This is a move that no [U.S.] administration has dared to do for decades," cheered Nabil Shaath, a longtime Palestinian diplomat.

Maybe so, but it was an entirely symbolic act. Six months after its passage, there are no blue-helmeted peacekeepers on the hills around Nablus. Israel approved plans for 5,000 new settler homes in the first few weeks after Trump's inauguration, and then another large batch in June, weeks after the president visited the region. Nickolay Mladenov, the top U.N. envoy to the region, admitted in June that Israel had ignored the resolution. "In fact…there has been [a] substantial increase in settlement-related announcements," he said.

Israeli activists sit on a rooftop in the settlement of Ofra in the West Bank. An Israeli court said the house had been illegally built on Palestinian land. Many Americans now support sanctioning Israel over illegal settlements. Menahem Kahana/AFP/Getty

Meaningless as it was, the White House is unlikely to repeat this gesture over the next few years. The U.S. has steered the "peace process" for more than two decades, since that symbolic moment when four Israeli and Palestinian leaders shook hands and signed the Oslo Accords on the White House lawn. (Three of them are now dead; only Abbas remains.) George W. Bush had the Annapolis conference and his "road map for peace." Obama had his unnamed initiatives, which also ended in failure. It is too early to say how far Trump will trudge down the same road—whether he will convene a Mar-a-Lago peace summit or abandon the process. But it was striking that, in six public appearances during his 25-hour visit to Israel and the West Bank this past spring, he didn't once utter the phrase "two-state solution." Many Palestinians saw it as a tacit admission that the peace process had failed.

"For decades, you had an Arab world, with U.S. leadership, that was interested in maintaining stability in the region," says Khalil Shikaki, the director of Palestine's top pollster. "But the American role reached its peak in the early 1990s, and it's been waning ever since."

For older Palestinians, the goal is still to create a Palestinian state along the pre-1967 borders. The younger generation sees this idea as hopelessly outdated. Decades of struggle, on the battlefield and around the negotiating table, failed to deliver a state. Last year, for the first time, Shikaki found that support for the two-state solution had dipped below 50 percent. "Fatah has tried diplomacy for 35 years, and here we have the so-called resistance movement," says one young man from Shuja'iya, a neighborhood in eastern Gaza that was hit hard during the 2014 war. "And what do we have? Nothing."

Instead, many now see their struggle as a civil rights movement: "Give us Israeli passports," they argue, "and let us work in Tel Aviv and fly abroad from Ben-Gurion airport." Even Palestinians who are committed to two states acknowledge that the idea has an expiration date. "The two-state solution is not a Palestinian demand," says Husam Zumlot, the Palestinian ambassador in Washington. "It's a Palestinian offer."

By many estimates, Palestinians are now the majority between the river and the sea. A civil rights struggle would have unmistakable echoes of the fight against apartheid. And a single state would likely never have a Jewish majority—an argument the Israeli center-left uses to push for a two-state solution. But their warnings have done little to move public opinion.

In the United States, on the other hand, there are already signs of such a shift. In a 2014 poll by the Brookings Institution, 38 percent of Americans supported sanctioning Israel over its illegal settlements. Two years later, the number jumped to 46 percent. Within those figures was a striking partisan gap. Democratic support for sanctions grew by a quarter, from 48 percent to 60 percent, while Republican support stayed basically flat. A majority of Democrats now believe Israel has too much influence over U.S. policy. Less than 25 percent of Republicans agree, and the number has dipped over the past few years.

Liberal American rabbis who visit Jerusalem fret openly that their younger congregants no longer feel an attachment to Israel the way their parents did. The rift is only deepened by political and social trends inside of Israel, where the Jewish population has become more nationalistic and religious—a shift that alienates Jews in America, a reliably liberal bloc but also Israel's best advocate in Washington.

A Palestinian woman walks past a mural of Trump painted on the barrier separating Israel from the West Bank city of Bethlehem. Trump’s efforts to create peace in the region have already collided with the hard realities on the ground. Heidi Levine

And Israel has no replacement for its "unbreakable alliance" with the United States. Though its new allies in Africa and Asia are useful trade partners, they cannot offer a reliable Security Council veto, nor the billions in annual military aid that have preserved Israel's military edge over its neighbors.

For all its tactical brilliance, Israel has always struggled with strategic thinking. It helped nurture Hamas in the late 1980s, for example, because it saw the Islamist group as a useful counterweight to its secular enemies. In doing so, it helped create an intractable foe. Netanyahu likes to boast that his administration "manages the conflict." Though his long tenure may be coming to an end, as graft investigations swirl, his probable successors will likely take a similar approach—one that could be similarly shortsighted and, in the long run, pose enormous risk for Israel.

Who's Afraid of the Big, Bad Boycott?

On a rainy morning in 2016, hundreds of Israelis packed into a Jerusalem conference hall for a major summit on the Boycott, Divestment and Sanctions movement, a global campaign to punish Israel for its half-century occupation. The Netanyahu government had spent the previous few years casting it as a sort of existential threat. In 2015, when Gilad Erdan accepted a job as the minister in charge of fighting BDS, he told reporters he did so with "a sense of holy dread."

One by one, leading Israeli politicians took the stage in Jerusalem to warn of the dire threat posed by boycotts. The president spoke. So did the opposition leader and at least four Cabinet members. (The keynote speaker was Roseanne Barr.) After a few hours of this, it was Moshe Kahlon's turn, and the center-right economy minister offered a discordant note. He explained that his ministry had set up a hotline to help Israeli businesses harmed by BDS. But it hadn't received many calls. "I don't think there's something that you can specifically call a detrimental effect or some kind of damage" to the economy, he said.

Even if Israel's strategy is ultimately counterproductive, the day of reckoning seems far off. By one 2014 estimate, BDS shaved just $30 million off Israel's annual gross domestic product, less than one-hundredth of a percent—52 minutes' worth of economic activity. Foreign investments in Israel have more than tripled in the decade since the BDS movement began. Exports to the European Union, its largest trading partner, have grown by more than 30 percent. Israel can offer cutting-edge agricultural technology to African states and high-tech opportunities to Asia. Neither of them care much about the occupation or the BDS movement, which they regard as a curiosity, a fad on Western college campuses.

A Jewish Israeli father with his children at the funeral for his wife, who was murdered by a Palestinian attacker. Neither violence nor diplomacy has forced Israel to make concessions. Heidi Levine

The Palestinians have little to offer their allies. After 50 years of occupation, their aid-dependent economy produces almost nothing of value. They would be of little help against the Islamic State militant group, or in the regional cold war with Iran. Western policymakers once promoted a theory of "linkage," the idea that resolving the Israeli-Palestinian conflict would bring peace to the Middle East. No one believes that anymore, not with the entire region in flames. Quite the opposite: Even Arab states, from Egypt to the Gulf, are eager to establish closer ties with Israel, which they see as a useful partner in the fight against both terrorism and Iran. Israeli politicians like to criticize Qatar because the tiny Gulf emirate hosts the leadership of Hamas. Yet the tens of millions of dollars in aid Qatar provides to Gaza have helped to stave off another war—and preserve the status quo. To an unprecedented degree, the Palestinians are alone.

"We're no longer the main issue," says Abu Saada, the Gazan political analyst. "We're not in a good position. We don't have good cards to play against Israel…and we can only hope that the next generation will bring some new ideas."