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5 Dec, 2013

Oligarchy in the Holy Land — Tiny Number of Families Dominates Israel’s Economy | Alternet

Israel’s gaping inequality is also manifested in housing policy. When the state was founded on the ruins of Palestinian villages, new towns were created in the periphery of Israel, and they came to be populated mostly by Mizrahi Jews. While the Mizrahi Jews served an important purpose for the state in building a demographic buffer between the Palestinians and Israeli Jews, they were also condemned to poverty by being far away from the center of Israel, where most of the jobs were.

Inequality was fueled by structural changes in the Israeli economy following economic crises in the mid-1980s, which included very high inflation. The government took advantage of the crisis by pushing measures that liberalized the economy and privatized state businesses—which boosted the people who came to be the tycoons of the country.

Yet another factor contributing to Israeli inequality is the occupation of the West Bank and Gaza, which began in 1967. A small slice of Israelis profit from the occupation industry by building the components that the fourth largest military in the world uses. The settlement project in the West Bank also functions as a social welfare program for some Jews. They can get a better deal on housing if they move to the state-subsidized settlements in the West Bank. But Israel’s expenditures to maintain the occupation also drain funds away from projects that could be used for social spending.

Read the rest: Oligarchy in the Holy Land — Tiny Number of Families Dominates Israel’s Economy | Alternet.