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An unrestrained Israel is reshaping the Middle East

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The Economist

Mar 27, 2025 10:37 AM IST

Israel’s 15-month assault on Gaza has battered Hamas; it can no longer mount a serious attack.

TEN years and a lifetime ago, Binyamin Netanyahu offered a stark vision of the future. Israel’s prime minister told a parliamentary committee that there could never be peace with the Palestinians. “I’m asked if we will forever live by the sword,” he said. “Yes.” His words were a source of controversy, not least among the leaders of the Israel Defence Forces (IDF), who did not think the government should give up on diplomacy. Yet today Mr Netanyahu’s vision is an almost unquestioned reality. It has remained so even though Israel has reversed the sense of peril it felt immediately after Hamas, a Palestinian militant group, went on a rampage across southern Israel on October 7th 2023, killing more than 1,100 people and kidnapping 250 more.

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Israel’s 15-month assault on Gaza has battered Hamas; it can no longer mount a serious attack. Hizbullah, a Shia militia in Lebanon, is also reeling after Israel pummelled it, too. In addition, the overthrow of Bashar al-Assad, Syria’s dictator, has cut Hizbullah’s main supply line to Iran. The “ring of fire” around Israel that Iran had created by funding such militias has burned down to embers. And Israel has withstood Iranian missile attacks and smashed Iranian air defences in retaliation.

In years past, Israel might have been content to stop there. But its current leaders favour an unbridled assertion of power, some for pragmatic reasons, others for ideological ones. They are seizing territory beyond their borders, advocating further strikes on Iran and contemplating the outright annexation of Palestinian land. The goal appears to be regional hegemony. But the doubts about such an approach remain the same as when Mr Netanyahu first endorsed the life of the sword: can Israel sustain an indefinite war—and should it?

Israel’s changing approach to Gaza shows how its strategic ambitions have grown. During the war’s first year it was reluctant to occupy much territory within the enclave. Instead, the idf seized a buffer zone inside its borders, and two corridors that bisected it, but little else: the army feared a prolonged counter-insurgency. Then came a six-week ceasefire with Hamas, agreed in January, which was meant to buy time to negotiate a permanent end to the war.

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On March 18th Israel abandoned the ceasefire and resumed attacks on Gaza. It is gearing up for a fresh ground offensive. Lieutenant-General Eyal Zamir, the new IDF chief, has promised more aggressive tactics. Israel plans to depopulate large parts of the strip and lay siege to anyone who remains in them. It also intends to hold territory. Israel Katz, the defence minister, has warned the occupation may be permanent. These plans have not yet been implemented, but if they are, they will escalate an already bloody war, which has claimed more than 50,000 lives in Gaza.

In the West Bank, meanwhile, the army is waging its biggest offensive in decades. More than 40,000 Palestinians have been displaced from four refugee camps in the north of the territory. Mr Katz has said that Israeli troops might remain in those camps for the rest of the year. Far-right lawmakers are pushing ahead with plans to expand Jewish settlements, which are illegal under international law. On March 23rd the security cabinet voted to legitimise 13 “outposts”, wildcat settlements that had been built without the government’s approval. The right hopes to persuade Donald Trump, America’s president, to back their plans to annex part or all of the West Bank, which would make it impossible to create a Palestinian state.

Elsewhere, Israel has occupied a swathe of Syrian territory (see map), including Mount Hermon, the region’s highest point. It seems to have no intention of leaving. Israel is trying to court the Druze, a minority group concentrated in southern Syria. It may hope to fracture Syria into a federation of autonomous ethnic statelets; some Israeli commentators have urged the Druze to secede. Israel also continues to occupy five hilltops in southern Lebanon, even though it promised to withdraw from them in late January under the terms of its ceasefire with Hizbullah.

Then there is Iran. Mr Netanyahu has dreamed for years about conducting military strikes on Iran’s nuclear facilities. He is energetically lobbying America’s government to bless such an attack and ideally to join in. America’s spies believe that Israel is likely to act within six months.

This new, hegemonic Israel is the product in part of the lingering trauma of October 7th. Before the massacre Israel sought to avoid all-out conflict, contenting itself with periodic strikes against its foes, to assassinate threatening leaders or destroy sophisticated weapons. When it went to war, as it did several times against Hamas, it kept the wars short. The goal was to deter and degrade its adversaries, not to obliterate them.

In hindsight, many Israeli generals and spies see that policy as naive. They are no longer willing to tolerate threats on their borders—even hypothetical ones. Syria’s new rulers have been clear that they want a peaceful relationship with their neighbour (and after a decade of civil war, they are in no position to fight the Middle East’s strongest army). That has not stopped Israel from seizing even more Syrian territory, to protect the land it seized in 1967.

For Israel’s hard right, though, the goal is not merely to protect the country but to expand it. They have dreamed for years of rebuilding Jewish settlements in Gaza, which were evacuated in 2005, and annexing the West Bank. Some fantasise about a “greater Israel” that stretches from the Nile to the Euphrates. They are a minority in Israel, but they are an increasingly powerful one. Mr Netanyahu may not share their yearning for a biblical kingdom, but he needs their support for his earthly goals. He wants to stay in power, and that requires keeping his extremist allies on side.

Jewish Power trip

In January Itamar Ben-Gvir, the head of the hard-right Jewish Power party, left the coalition to protest against the Gaza ceasefire. He rejoined the government after Israel restarted the war. That gave Mr Netanyahu the numbers to pass this year’s budget, on March 25th. If he had not done so by the end of March, early elections would have been triggered. Breaking the ceasefire thus helped clear the way for the prime minister to remain in power until late 2026.

Mr Netanyahu also wants to stay out of jail. He has been on trial for corruption since 2020 (he denies the charges). A state of perpetual war has helped postpone his legal reckoning. He has argued that he is too busy with affairs of state to spend much time on the witness stand: “I am leading the country through a seven-front war,” he lectured the judges in December. In February the court approved his request to testify only two days a week, not three.

In the past, Israel’s allies might have tried to temper its belligerence. Mr Trump did press Mr Netanyahu to accept ceasefires in Lebanon and Gaza. But his attention has wandered. When Mr Netanyahu visited Washington in February, many Israelis thought he would be strong-armed into negotiating the second phase of the Gaza ceasefire, which was meant to bring the war to a permanent end. Instead Mr Trump proposed a madcap scheme to depopulate Gaza and turn it into a holiday resort. Phase-two negotiations never started.

Nor are regional leaders exerting much pressure. When the Gaza war began, many Arab autocrats feared it would spark unrest in their countries. That has not happened. With their streets quiet, rulers contented themselves with rhetorical condemnations of the war. None broke off diplomatic relations with Israel. The Abraham accords, which saw Israel normalise ties with four Arab countries in 2020, remain intact. Saudi Arabia says it is still willing to join the pact, although only if Mr Netanyahu lays out a path to Palestinian statehood.

Even with all these factors in its favour, however, Israel is discovering that being a hegemon is hard. For a start, it is badly straining Israel’s army. Reservists have put their lives on hold to do long tours of duty. The 295,000 soldiers mobilised since the start of the war have served an average of 61 days (the pre-war average was around 25 days a year). A third of them have spent more than 150 days in uniform. Burnout is setting in: some units are finding that only 60-70% of soldiers report for duty when summoned. “We know we will only have about half of our men for the next round,” says the personnel officer of a reserve unit scheduled for deployment in Gaza next month.

The new budget earmarks 110bn shekels ($29bn) for defence—75% above the 63bn shekels allocated in 2023. Civilian ministries’ spending is to be cut by 5bn shekels. The budget also raises national-insurance contributions and trims some public-sector salaries. Value-added tax has already increased from 17% to 18%. Even so, the deficit will be 4.9% of GDP. Public debt climbed from 60% of GDP in 2022 to 69% last year.

Not everyone is being squeezed, though. Mr Netanyahu’s allies will get 5bn shekels in “coalition funds” to dole out on pet projects, including more than 1bn shekels for religious schools attended by ultra-Orthodox Jews, who mostly refuse to serve in the army. Yair Lapid, the leader of the opposition, calls the budget the “greatest robbery in the history of the country”. Protesters blocked the entrance to the Knesset ahead of the vote.

That points to a deeper crisis. The past few years have shattered public confidence in the state, not only owing to its failure to prevent October 7th. Years of political turmoil preceded the massacre. Mr Netanyahu called four inconclusive elections between 2019 and 2021, only to be briefly forced from power. When he returned in late 2022 he set out to hobble the supreme court, triggering the largest protests in Israel’s history.

In 2018, 55% of Israeli Jews thought the country was in a good situation. Today just 11% do (see chart). The Israel Democracy Institute (IDI), a non-partisan think-tank, conducts an annual survey of trust in public institutions. It has found big drops in support for the government, the Knesset and even the army.

Mr Netanyahu is doing little to regain their confidence. In another IDI poll, 73% of Israelis said they wanted to implement the second stage of the Gaza ceasefire, during which Hamas was to free its remaining 59 hostages. The decision to abandon the deal—and the hostages—sparked big protests. Many Israelis believe the interests of the state are being subordinated to those of the prime minister. Some reservists are debating whether to ignore draft notices for a new ground offensive.

On March 16th Mr Netanyahu said he would sack Ronen Bar, the head of the Shin Bet, Israel’s domestic-security service. The high court has temporarily stayed that decision. A week later ministers unanimously approved a no-confidence motion against Gali Baharav-Miara, the attorney-general, initiating the process of removing her from office. (They will struggle to see the process through.)

The prime minister has self-interested reasons to want the two gone. The Shin Bet is investigating allegations that several of his aides took payments from Qatar to promote the Gulf state’s interests, at the same time as Qatar (with Mr Netanyahu’s encouragement) was sending $30m a month to Hamas. As for Ms Baharav-Miara, her office is overseeing the corruption case against Mr Netanyahu. Israel is thus in a remarkable situation where a defendant is trying to fire his prosecutor.

It is a toxic brew: the government is asking its citizens for big sacrifices even as those citizens despair of their government. A prolonged occupation of Gaza, to say nothing of annexing the West Bank, would add to both the burden and the division. Though many Israelis are sceptical that they can make peace with the Palestinians, they do not share the right’s longing for a “greater Israel”. An endless occupation will engender endless resistance. The Palestinians may be too weak to challenge Israel today, either on the battlefield or the diplomatic stage, but history suggests they will not remain so indefinitely.

Syria may also become a cautionary tale. On March 25th the IDF said its troops in southern Syria were attacked by gunmen. They returned fire and called in an air strike, killing at least five people. The shoot-out sparked outrage among some Syrians, who urged the interim government to send forces south. Israel says its troops are in Syria to prevent threats from emerging, yet it may end up creating them.

Another question is whether America’s mercurial president will be a reliable ally. For now, he seems inclined to let Israel fight. Mr Netanyahu and his right-hand man, Ron Dermer, seem to have convinced Mr Trump’s people that Israel can win a decisive victory over Hamas in the next few months. On Syria, too, the Trump administration is so far aligned with Israel’s view that the country’s new rulers cannot be trusted.

But backing Israel is expensive and Mr Trump hates spending lavishly to defend America’s allies. On top of $18bn in military aid, America has burned through at least $5bn to fund its own military operations in the Middle East since October 7th. The president may eventually balk at the cost of supporting a hegemonic Israel.

Peace-prizenik

Moreover, Mr Trump wants to be a dealmaker (and, he hopes, a Nobel laureate). In his first term, faced with a choice between allowing Israel to annex parts of the West Bank and pursuing the Abraham accords, he opted for the latter. Mike Huckabee, his nominee for ambassador to Israel, has long been a vocal supporter of annexation. At his confirmation hearing on March 25th, however, he tried to distance the administration from his past views: “It would not be my prerogative to make [annexation] the policy of the president.”

When it comes to Iran, Mr Trump is at odds with many of his advisers, who oppose efforts to negotiate a new agreement that would limit the Islamic Republic’s nuclear programme. “Everyone around him is against a deal,” says an Arab diplomat. Some officials in Washington wonder if recent American air strikes against the Houthis were not only a warning to Iran but a trial run of sorts.

For now, though, Mr Trump seems intent on making a deal. Steve Witkoff, his Middle East envoy, thinks he can negotiate one quickly. He has told Republicans that he does not want to repeat the experience of John Kerry, Barack Obama’s secretary of state, who spent months in 2015 haggling over a 159-page pact, known as the Joint Comprehensive Plan of Action (JCPOA).

This dilemma may soon come to a head. The European signatories to the JCPOA have until October 18th to trigger the deal’s “snapback” provision, which would reimpose UN sanctions on Iran. Military planners would also prefer to carry out any strikes before winter weather makes the task harder.

If Iran is unwilling to negotiate a serious deal, it seems plausible that Mr Trump would not only bless an Israeli strike but join it. If Iran is willing to talk, however, Mr Netanyahu could find himself with an unpalatable choice: defy the president and act unilaterally, or back down and accept a nuclear pact that will probably be weaker than the JCPOA, which he denounced.

Even for a hegemon, regional diplomacy is fraught with such quandaries. One way or another, Israel will have to find a way to live with 5m Palestinians, with its neighbours in Lebanon and with whatever regime emerges in Syria. It will also have to live with itself. For decades, external threats helped unite the country. Now, by trying to stamp out those external threats so ferociously, Israel’s government is deepening divisions at home.

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