Shadow of Israel's pullout from Gaza hangs heavy 10 years on

JERUSALEM It would, said then prime minister Ariel Sharon, a former major-general not given to self-doubt, "grant Israeli citizens the maximum level of security". Other optimists said it would turn Gaza into the Hong Kong of the Middle East.

A decade on from Israel's unilateral withdrawal of around 8,500 Jewish settlers from the Gaza Strip, the legacy of that August 2005 "disengagement" still provokes angry debate in Israeli society.

Within Gaza itself, there is nothing to debate: the past 10 years were an unmitigated catastrophe. In that time, its 1.8 million residents have endured a civil war between Palestinian factions and four wars with Israel that killed more than 4,000 Gazans and destroyed tens of thousands of homes.

A blockade imposed by Israel and Egypt means residents cannot import many basic construction materials to rebuild. Israel no longer gives work permits to Gazans, and only a tiny few ever receive permission to set foot out of the increasingly impoverished enclave, the rest confined indefinitely to an area less than half the size of New York City.

According to the World Bank, Gaza now has the world's worst-performing economy, with the world's highest unemployment at 43 percent, 68 percent among those aged 20-24. Since 1994, real per capita income has fallen by nearly a third. Manufacturing -- once the hoped-for backbone of an economic revival -- has shriveled by 60 percent.

"The Jews left Gaza and destroyed it in war after war," said Ali Musa, a 49 year-old taxi driver in Gaza, who worked for a decade as a construction worker in Israel before permits ceased. "They control the borders, the sea and sky. So did they actually end occupation? No."

But increasingly, the pullout is also seen as a disaster by Israelis, with thousands of rockets from Gaza having rained down on Israel since 2005 and a peace deal with the Palestinians even further out of reach.

"The gap between the aspirations and the results is wide," Shmuel Even, a senior research fellow at the Institute for National Security Studies, noted dryly in a paper published last month, an assessment of the disengagement 10 years on.

"(It) created a new reality that contributed to the Hamas takeover of the Gaza Strip, a steep rise in weapons smuggling, the strengthening of terrorism, and the ensuing cycle of escalation," he wrote. "It appears that most of the security events in the south over the past decade were the result of the disengagement."

SHARON NEVER SEES RESULTS

Less than five months after the withdrawal, Sharon, then 76, suffered a stroke and fell into a coma. He died eight years later having never regained consciousness to learn of the full consequences of his initiative.

He believed it would fundamentally change Israel's security and the way the country was perceived by outsiders, ushering in an era in which land could be exchanged for peace, with the potential for a similar process in the occupied West Bank.

But four months after the pullout, the Islamist group Hamas won legislative elections in the Palestinian territories. A few months later, an Israeli soldier stationed on the Gaza border was kidnapped by Hamas militants, leading to an Israeli military assault. From Gaza, militants fired hundreds of rockets into Israel.

By the summer of 2007, Hamas had won a civil war against the armed wing of the rival Fatah party and seized full control of Gaza. Rocket and mortar fire into Israel continued through 2008, leading to another war in December and January 2009 that killed around 1,200 Palestinians and 13 Israelis, the worst fighting in the area since 1967.

Another war followed in 2012 and another last year -- the deadliest of all, with an estimated 2,200 Palestinians and 73 Israelis killed. Israeli generals predict more bloodshed to come, talking of how it might be necessary to "mow the lawn" in Gaza every few years.

"WE FAILED"

At the time of the withdrawal, polls showed around half of Israelis supported it. But a recent survey by the Begin-Sadat Center for Strategic Studies showed 63 percent now think it was a mistake. Nearly half now oppose any West Bank withdrawal.

Prime Minister Benjamin Netanyahu, who was Sharon's finance minister at the time, at first joined the cabinet in approving the disengagement. But on the eve of the withdrawal he resigned, laying the ground for his eventual return for a second term as prime minister in 2009.

Even current center-left opposition leader Isaac Herzog, who supported the withdrawal at the time, finds it troubling now. Demographically, he says, it was the right thing to do, but "without a doubt, from a security perspective, the disengagement was a mistake," he told a right-wing conference last month.

"We failed in our assessment that post-withdrawal Gaza would become the Hong Kong of the Middle East," he said. "Instead, it has become one big rocket base."

Images of distraught settlers being dragged kicking and screaming from their homes by tearful Israeli soldiers are broadcast often on TV, stirring old emotions.

Around 350 families of former Gaza settlers remain without permanent housing, living in temporary homes north of the territory. While they received generous compensation, with larger families getting up to 2 million shekels ($500,000), they have been vociferous in their criticism of Sharon's decision.

BENEFITS

The disengagement itself was a costly operation -- the bill came to around 11 billion shekels (nearly $3 billion). But Sharon maintained it would have long term economic benefits for Israel, improving its image and luring investment and trade.

Here, the case is easier to make in Sharon's favor. While it is impossible to quantify the direct economic impact of the withdrawal, Israel's previously stagnant economy has undeniably boomed since the Gaza settlers were pulled out.

Peace moves in the year of the withdrawal, 2005, brought an end to the "Second Intifada", a five-year Palestinian uprising, during which Israel's per capita GDP actually fell, from $20,900 in 2000 to $20,376 in 2005 according to the World Bank.

Since then, Israel's GDP has doubled overall, with the per capita figure rising by 76 percent to $36,050 today.

Whatever the verdict on the withdrawal from Gaza, there is virtually no chance that Israel would repeat it in similar unilateral fashion from the West Bank, where 400,000 Jewish settlers -- 50 times as many as were withdrawn from Gaza -- live among 2.3 million Palestinians.

Many nationalist Jews consider the West Bank part of their biblical homeland, unlike Gaza.

The majority of West Bank settlers live in large "blocs" adjacent to the Green Line that marked the border before the 1967 Middle East war. While all settlements are regarded as illegal under international law, Israel expects to keep those blocs in any final peace agreement.

Outside the blocs there are still an estimated 80,000 West Bank settlers, many with strong links to the government through the ultranationalist Jewish Home party. Pulling them out of the West Bank could provoke insurrection, with no guarantee of greater stability with the Palestinians.

The key, argues Even of the Institute for National Security Studies, would be that an agreement be struck first.

"The correct way to achieve a territorial compromise is a stable agreement consistent with Israel's long-term goals," he wrote, adding that if and when a peace deal is ever reached, Israel should hand its settlements over to the Palestinians rather than destroying them, as it did in Gaza 10 years ago.

(Additional reporting by Nidal al-Mughrabi in Gaza; Writing by Luke Baker; Editing by Peter Graff)