Throughout Israel, Palestinians are being suffocated

Despite growing understanding of the struggles of Palestinian communities, we still need to move bey

Shortly after I had arrived in Palestine last month, I visited the devastated community in the Jordan Valley where the Israeli army had, just days earlier, demolished around 70 "illegal" structures. The same week, I visited Dahmash, an "unrecognised" village between Ramla and Lod, inside Israel, where Palestinian citizens face pending demolition orders. Finally, a few days later, I woke up to the news that the "unrecognised" Palestinian Bedouin village of al-Araqib, in the Negev, had been destroyed in a raid involving 1,300 armed police (and cheering volunteers).

Whether under military rule in the West Bank, or as citizens in Israel, Palestinian communities' ability to grow naturally is compromised by laws, "zoning" plans and permit systems designed to enforce a regime of separation and inequality. In 2008, a UN report detailed how 94 per cent of Palestinian building permit applications are denied in "Area C" of the West Bank, an area that covers 60 per cent of the territory.

"Area C" is also where major Israeli colonisation efforts have been focused. The Israeli human rights NGO B'Tselem estimates the total area controlled by settlements at over 40 per cent of the West Bank.

Inside pre-1967 Israeli borders, the state's approach to the Palestinian minority blows apart the myth of Israel as "the only democracy in the Middle East". As one recent study has shown, a quarter of Palestinian towns and villages inside Israel lack a building "master plan" and are thus ineligible for permits. In addition, while roughly a thousand new Jewish communities have been established since 1948, not a single Arab town has been created -- even as the minority population has multiplied by seven.

In Dahmash, ironically described as "Israel's best-kept secret", residents struggle to survive on land that has been designated "agricultural", while next door the zoning status was changed to facilitate a housing development aimed at Jewish Israelis.

As an "unrecognised" village, Dahmash is denied basic services and threatened with home demolitions. Activists on the ground see links with the struggles in East Jerusalem -- in other words, "internal colonialism is not yet history in Israel". As Arafat Ismayil, head of the Dahmash village committee, said to me, "We're in the heart of Israel, but we're not here."

In the Negev, long-standing policies of "Judaisation" -- similar to what has happened in Galilee -- shape the demolitions seen recently (a point made by the Israeli professor Neve Gordon). What Human Rights Watch called Israel's "discriminatory policies" occur in a context where Jewish National Fund forests, and maintaining a "Jewish majority", are prioritised over and above the rights and dignity of Palestinian Bedouin citizens.

On the same day as the destruction of al-Araqib, it was reported that the Israeli government plans to help army officers move to the Negev, part of moves to "strengthen" the area.

Naturally, the legal context differs. In the West Bank, restricting the Palestinians to certain areas and freeing up land for colonisation is effected using the military's prerogative to deny permits in "Area C", as well as the cover of "military necessity" and cherry-picking laws from Ottoman times and the British Mandate. Inside Israel's pre-1967 borders, the tools are land confiscation laws and manipulating planning procedures.

Yet the core dynamic is the same. The bulldozers in Silwan, al-Walaja and al-Araqib are advancing the same goals.

There is significance in drawing the connections between the struggles of Palestinian communities, whether they are in the heart of the West Bank or Galilee. In the west, and especially the UK and Europe, there is a growing understanding of, and solidarity with, the struggles centred on the likes of the siege of Gaza, the evictions in Sheikh Jarrah and the illegal Separation Wall. While this is welcome, there is a risk of missing the bigger picture -- and excluding Palestinians in Israel and the refugees altogether. It is about moving beyond the framework of "the occupation", and reintegrating the "Question of Palestine", with a fight for rights, justice and equality at the centre.

Who has done the most to fail to distinguish between pre-1967 Israel and the settlements? Who has "erased" the Green Line? The answer is the Israeli state, which for decades has pursued policies of colonisation, control and segregation in all of the territory under its control.

When the government sets its (discriminatory) plan for "National Priority Areas", West Bank settlements and Galilee are included alike. It means the adviser to the prime minister on settlements under Ariel Sharon and Ehud Olmert affirming his "commitment to bolstering the Jewish population" of the Golan, Galilee, Negev and West Bank, as "settlement is settlement". It is why the current minister for the development of the Negev and Galilee, Silvan Shalom, can talk of the need to "settle all parts of Israel, including the Negev and Galilee and Judaea and Samaria".

From the West Bank to the Negev, differences in geography and legal regime can conceal the disturbing reality: that events have a great deal in common, both practically and strategically.

Seeing these developments from a more holistic perspective has important implications for how we understand the conflict in Palestine/Israel, as well as consequences for the nature of our response.

Ben White is an activist and writer. His latest book is "Palestinians in Israel: Segregation, Discrimination and Democracy"

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We're racing towards another private debt crisis - so why did no one see it coming?

The Office for Budget Responsibility failed to foresee the rise in household debt. 

This is a call for a public inquiry on the current situation regarding private debt.

For almost a decade now, since 2007, we have been living a lie. And that lie is preparing to wreak havoc on our economy. If we do not create some kind of impartial forum to discuss what is actually happening, the results might well prove disastrous. 

The lie I am referring to is the idea that the financial crisis of 2008, and subsequent “Great Recession,” were caused by profligate government spending and subsequent public debt. The exact opposite is in fact the case. The crash happened because of dangerously high levels of private debt (a mortgage crisis specifically). And - this is the part we are not supposed to talk about—there is an inverse relation between public and private debt levels.

If the public sector reduces its debt, overall private sector debt goes up. That's what happened in the years leading up to 2008. Now austerity is making it happening again. And if we don't do something about it, the results will, inevitably, be another catastrophe.

The winners and losers of debt

These graphs show the relationship between public and private debt. They are both forecasts from the Office for Budget Responsibility, produced in 2015 and 2017. 

This is what the OBR was projecting what would happen around now back in 2015:

This year the OBR completely changed its forecast. This is how it now projects things are likely to turn out:

First, notice how both diagrams are symmetrical. What happens on top (that part of the economy that is in surplus) precisely mirrors what happens in the bottom (that part of the economy that is in deficit). This is called an “accounting identity.”

As in any ledger sheet, credits and debits have to match. The easiest way to understand this is to imagine there are just two actors, government, and the private sector. If the government borrows £100, and spends it, then the government has a debt of £100. But by spending, it has injected £100 more pounds into the private economy. In other words, -£100 for the government, +£100 for everyone else in the diagram. 

Similarly, if the government taxes someone for £100 , then the government is £100 richer but there’s £100 subtracted from the private economy (+£100 for government, -£100 for everybody else on the diagram).

So what implications does this kind of bookkeeping have for the overall economy? It means that if the government goes into surplus, then everyone else has to go into debt.

We tend to think of money as if it is a bunch of poker chips already lying around, but that’s not how it really works. Money has to be created. And money is created when banks make loans. Either the government borrows money and injects it into the economy, or private citizens borrow money from banks. Those banks don’t take the money from people’s savings or anywhere else, they just make it up. Anyone can write an IOU. But only banks are allowed to issue IOUs that the government will accept in payment for taxes. (In other words, there actually is a magic money tree. But only banks are allowed to use it.)

There are other factors. The UK has a huge trade deficit (blue), and that means the government (yellow) also has to run a deficit (print money, or more accurately, get banks to do it) to inject into the economy to pay for all those Chinese trainers, American iPads, and German cars. The total amount of money can also fluctuate. But the real point here is, the less the government is in debt, the more everyone else must be. Austerity measures will necessarily lead to rising levels of private debt. And this is exactly what has happened.

Now, if this seems to have very little to do with the way politicians talk about such matters, there's a simple reason: most politicians don’t actually know any of this. A recent survey showed 90 per cent of MPs don't even understand where money comes from (they think it's issued by the Royal Mint). In reality, debt is money. If no one owed anyone anything at all there would be no money and the economy would grind to a halt.

But of course debt has to be owed to someone. These charts show who owes what to whom.

The crisis in private debt

Bearing all this in mind, let's look at those diagrams again - keeping our eye particularly on the dark blue that represents household debt. In the first, 2015 version, the OBR duly noted that there was a substantial build-up of household debt in the years leading up to the crash of 2008. This is significant because it was the first time in British history that total household debts were higher than total household savings, and therefore the household sector itself was in deficit territory. (Corporations, at the same time, were raking in enormous profits.) But it also predicted this wouldn't happen again.

True, the OBR observed, austerity and the reduction of government deficits meant private debt levels would have to go up. However, the OBR economists insisted this wouldn't be a problem because the burden would fall not on households but on corporations. Business-friendly Tory policies would, they insisted, inspire a boom in corporate expansion, which would mean frenzied corporate borrowing (that huge red bulge below the line in the first diagram, which was supposed to eventually replace government deficits entirely). Ordinary households would have little or nothing to worry about.

This was total fantasy. No such frenzied boom took place.

In the second diagram, two years later, the OBR is forced to acknowledge this. Corporations are just raking in the profits and sitting on them. The household sector, on the other hand, is a rolling catastrophe. Austerity has meant falling wages, less government spending on social services (or anything else), and higher de facto taxes. This puts the squeeze on household budgets and people are forced to borrow. As a result, not only are households in overall deficit for the second time in British history, the situation is actually worse than it was in the years leading up to 2008.

And remember: it was a mortgage crisis that set off the 2008 crash, which almost destroyed the world economy and plunged millions into penury. Not a crisis in public debt. A crisis in private debt.

An inquiry

In 2015, around the time the original OBR predictions came out, I wrote an essay in the Guardian predicting that austerity and budget-balancing would create a disastrous crisis in private debt. Now it's so clearly, unmistakably, happening that even the OBR cannot deny it.

I believe the time has come for there be a public investigation - a formal public inquiry, in fact - into how this could be allowed to happen. After the 2008 crash, at least the economists in Treasury and the Bank of England could plausibly claim they hadn't completely understood the relation between private debt and financial instability. Now they simply have no excuse.

What on earth is an institution called the “Office for Budget Responsibility” credulously imagining corporate borrowing binges in order to suggest the government will balance the budget to no ill effects? How responsible is that? Even the second chart is extremely odd. Up to 2017, the top and bottom of the diagram are exact mirrors of one another, as they ought to be. However, in the projected future after 2017, the section below the line is much smaller than the section above, apparently seriously understating the amount both of future government, and future private, debt. In other words, the numbers don't add up.

The OBR told the New Statesman ​that it was not aware of any errors in its 2015 forecast for corporate sector net lending, and that the forecast was based on the available data. It said the forecast for business investment has been revised down because of the uncertainty created by Brexit. 

Still, if the “Office of Budget Responsibility” was true to its name, it should be sounding off the alarm bells right about now. So far all we've got is one mention of private debt and a mild warning about the rise of personal debt from the Bank of England, which did not however connect the problem to austerity, and one fairly strong statement from a maverick columnist in the Daily Mail. Otherwise, silence. 

The only plausible explanation is that institutions like the Treasury, OBR, and to a degree as well the Bank of England can't, by definition, warn against the dangers of austerity, however alarming the situation, because they have been set up the way they have in order to justify austerity. It's important to emphasise that most professional economists have never supported Conservative policies in this regard. The policy was adopted because it was convenient to politicians; institutions were set up in order to support it; economists were hired in order to come up with arguments for austerity, rather than to judge whether it would be a good idea. At present, this situation has led us to the brink of disaster.

The last time there was a financial crash, the Queen famously asked: why was no one able to foresee this? We now have the tools. Perhaps the most important task for a public inquiry will be to finally ask: what is the real purpose of the institutions that are supposed to foresee such matters, to what degree have they been politicised, and what would it take to turn them back into institutions that can at least inform us if we're staring into the lights of an oncoming train?