Israel’s only alternative to being a garrison state is deep interconnection with Arabs, particularly economic. Situation now is crucially different from the 1948. Arabs bullied a new kid on the block, found him strong, and accepted. Likewise, America fought Russia in Siberia in the 1918-1925 war, but then switched to cooperation. Arabs were reluctant to fight in 1967, and only fought to return Sinai and the Golan Heights in 1973. Israel cannot develop quite a Hong Kong-type economy because Arab countries, unlike China, are economically worthless and relatively open, thus Western companies don’t need Israel as an intermediary. Israel can become a Western representative in the Middle East, offering Arabs Western investment vehicles and financial opportunities in the familiar Middle Eastern environment. Arabs won’t attack their own investments and bank accounts.
Israel follows the late South Africa’s path of rejecting the obvious demographical and political changes, fixing the untenable status quo, hysterical military actions, and a police state. But today, South Africa builds a nominally democratic country which excludes Blacks informally. Blacks don’t achieve in South African business, and the corporate world is white. Corporations pay off the Blacks with welfare and sinecures to accept the de facto white rule. That precarious balance could be swept away any time, but holds so far. Lebanon struck a similar balance between Christians and Muslims with government and parliamentary quotas. White South Africans tolerate astronomical HIV (30%), crime, and unemployment (40%) rates among Blacks. That’s close to Rabin’s ideal of sealing Gaza off so that Arabs kill each other (and, presumably, starve) as spiders in a can.
International media trumpets few black faces in South African government and corporate management while the majority of Blacks continues as human rabble. The Israeli left successfully implemented South African approach for decades, but since 1990s put Jewish money where the leftists’ mouths are, and now heavily subsidize the Arabs.
The Saudi peace plan is not entirely unrealistic. Most descendants of the 1948 Palestinian refugees won’t return to Israel. They are already settled in other countries, received citizenship, and won’t move to be the second-rate citizens of Israel out of nostalgia. In the worst-case scenario, 300-400 thousands Palestinian refugees who live now outside the PA and return to Israel, won’t add up too much to her Arab population. Besides, Saudis call for a “just solution” to the refugee problem, not return; they will accept compensation and Americans will finance it.
Saudis demand that Israel abandons east Jerusalem, but Palestinians settle it, anyway. The place is as Judenfrei as practically possible. Muslims will never sign with Israel a peace agreement which abandons their claim to Jerusalem. Israeli leftists imagine they can attach suburbs to Jerusalem and give them to Palestinians as “East Jerusalem.” That won’t work.

