It’s not a question to be taken for granted. If I had to give a short answer, I might say that Israel continues its occupation for land and resources—that it engages in what it knows to be a doomed “peace process” in order to eventually gain control over all of historic Palestine, “from the river to the sea”. At least, based on its actions, this is what Israel appears to be trying to do.
But there are continual and obvious contradictions in this idea. It is widely recognized among people educated in this topic that the longer Israel continues its occupation, the more it continues to build settlements throughout the West Bank along with infrastructure to serve those settlements, the closer it will come to having to deal with the 4 million+ Palestinians that inhabit the same space. Israel exhibits two conflicting desires: that for territory and that for a majority Jewish state. If Israel gains control over the entirety of historic Palestine, it will paradoxically lose its Jewish majority and thus its identity as a Jewish state.
So then how do we explain the current system? I recently read The Political Economy of Israel’s Occupation: Repression Beyond Exploitation, written by Israeli academic Shir Hever. I outline here some of the theories he describes that can be applied to the occupation of Palestinian land.
To the extent that the global status system is de-temporalized, or re-temporalized in nonprogressive ways, the nature of the relation between global rich and poor is transformed. For in a world of non-serialized political economic statuses, the key questions are no longer temporal ones of societal becoming (development, modernization), but spatialized ones of guarding the edges of a status group—hence, the new prominence of walls, borders, and processes of social exclusion in an era that likes to imagine itself as characterized by an ever expanding connection and communication.
James Ferguson, “Decomposing modernity: History and Hierarchy After Development” in Global Shadows: Africa in the Neoliberal World Order, 2007.