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Why Is Israel More Prosperous than the Palestinians?

In almost 40 years of studying these issues, I’ve never seen a better case study of mass media bias and knee-jerk narrowness than an aspect of the current flap about what presidential candidate Mitt Romney said during his trip to Israel. I’m going to focus on a single point because it brings this problem into sharp focus.

If you truly understand what you are about to read, I don’t see how you can accord most of the mass media any credibility when it comes to Israel ever again. Briefly, Romney mentioned the gap between the Israeli and Palestinian economies -- ironically, he vastly understated the gap -- and attributed it to “culture,” by which he meant, as Romney has said elsewhere, such things as democracy, individual liberty, free enterprise, and the rule of law.

But I’m not talking about Romney here or the media’s critique of him. What is interesting is this: How do you explain the reason why Israel is so more advanced in terms of economy, technology, and living standards? The media generally rejected Romney’s explanation and pretty much all made the same point. To quote the Associated Press story, that was:

Comparison of the two economies did not take into account the stifling effect the Israeli occupation has had on the Palestinian economy in the West Bank, Gaza Strip and east Jerusalem—areas Israel captured in 1967 where the Palestinians hope to establish a state.

In the West Bank, Palestinians have only limited self-rule. Israel controls all border crossings in and out of the territory, and continues to restrict Palestinian trade and movement. Israel annexed east Jerusalem in 1967, but has invested much less heavily there than in Jewish west Jerusalem.

Or, in other words, it’s all Israel’s fault. Yet in choosing to blame Israel, the media generally showed no interest at all in additional factors which are equally, or far more, valid.

I’m not suggesting that journalists and editors thought through the following list of factors and deliberately decided not to mention them. I think that these things never entered their minds. Yet how can that be? Some of these points require knowledge of the situation on the ground and its history. Still, many should be obvious to those who have read past newspaper accounts or just use logic, not to mention research.

Consider the points made below. You might count them for less, but anyone honest should admit that they add up to a compelling case:

1. The most devastating problem for the Palestinian economy has been the leadership’s refusal to make peace with Israel and to get a state. Most notably, the opportunities thrown away in 1948, 1979, and 2000 doomed both countries to years of suffering, casualties, and lower development. Today, in 2012, both Palestinian leaderships -- Fatah and Hamas -- continue this strategy.

2. Statistics show major advances in the West Bank and Gaza Strip during the period of Israeli occupation. A lot of money also came in from Palestinians working in Israel (or to a surprising extent on the Jewish settlements).

3. The media should be expected to explain why Israel interfered at all once, by around 1994, almost all West Bank and Gaza Palestinians were under Palestinian rule. The reason, of course, was Palestinian violence against Israel and Israelis. If there had not been such attacks, Israeli forces would not have set foot in Palestinian-ruled areas. Stability would have encouraged development and foreign investment. There would be no roadblocks. Incidentally, roadblocks and restrictions on travel have changed constantly and at times of relative quiet became almost non-existent. Of course, Israel maintained control of the borders to prevent weapons from coming in.

4. There was a large transfer of funds (as provided in the Oslo agreement, but PA behavior did not make Israel violate the agreement) from Israel to the PA regarding refunds on customs duties and workers' fringe benefits.

5.The well-documented incompetence and corruption of the Palestinian Authority. For example, there is no reliable body of law that a company could depend on there. Bribes determine who gets contracts. Literally billions of dollars have been stolen and mostly ended up in the European accounts of Palestinian leaders.

6. And where did those billions of dollars come from? They came from foreign donors who showered huge amounts of money on a relatively small population. Yet, even aside from theft, the money was not used productively or to benefit the people.