The issue of Jewish immigration to Palestine was not merely a moral or national issue; it had direct implication on the economic status of the Arab people of Palestine, affecting primarily the small and middle-income farmers, workers and certain sectors of the petty and middle bourgeoisies. The national and religious character of Jewish immigration further aggravated the economic repercussions.

Between 1933 and 1935, 150,000 Jews immigrated to Palestine, bringing the country's Jewish population to 443,000 - or 29.6% of the total - from 1926 to 1932 the average number of immigrants per year was 7,201.¹ It rose to 42,985 between 1933 and 1936, as direct result of Nazi persecution in Germany. In 1932, 9,000 German Jews entered Palestine, 30,000 in 1933, 40,000 in 1934 and 61,000 in 1935,² nearly three quarters of the new immigrants settling in cities. If Nazism was responsible for terrorizing the Jews and forcing them out of Germany; it was "democratic" capitalism, in collaboration with the Zionist movement, that was responsible for directing comparatively large numbers of Jewish migrants to Palestine, as illustrated by the following: of 2,562,000 Jews that fled Nazi persecution, the U.S.A. accepted only 170,000 (6.6%), Britain 50,000 (1.9%), while Palestine received 8.5% and 1,930,000 (75.2%) found refuge in the U.S.S.R.³ The severe economic impact of the immigration into Palestine can be realized when it is considered that a comparatively large percentage of Jewish settlers were basically capitalists: In 1933, 3,250 of the latter (11%) were considered as capitalists, in 1934, 5,124 or 12%, and in 1935, 6,309 or 10%.⁴

According to official statistics, of the Jewish immigrants who entered Palestine between 1932 and 1936, 1,370 (with 17,119 dependents) possessed PL 1,000 or more: and 130,000 were officially registered as seeking employment, or dependents of previous immigrants.⁵ In other words, the immigration was not only designed to ensure a concentration of European Jewish capital in Palestine, that was to dominate the process of industrialization, but also to provide this effort with a Jewish proletariat: The policy that raised the slogan of "Jewish labor only" was to have grave consequences, as it led to the rapid emergence of fascist patterns in the society of Jewish settlers.

Another result was the development of a competitive struggle between the Palestinian Arab and Jewish proletariats and between Palestinian Arab peasants, farmers and agricultural laborers and their Jewish counterparts. This conflict also extended to higher classes, in as much as the Palestinian Arab small landowners and urban middle bourgeoisie realized that their interests were being threatened by growing Jewish capital.

In 1935, for example, Jews controlled 872 of a total of 1,212 industrial firms in Palestine, employing 13,678 workers, while the rest were Palestinian Arab-controlled and employed about 4,000 workers: Jewish investment totaled PL 4,391,000 compared to PL 704,000 Palestinian Arab industrial investment; Jewish production reached PL 6,000,000 compared to PL 1,545,000 by Palestnian Arab firms: In addition, Jewish capital controlled 90% of the concessions granted by the British mandatory government, which accounted for a total investment of PL 5,789,000 and provided labor for 2,619 workers.⁶

An official census in 1937 indicated that an average Jewish worker received 145% more in wages than his Palestinian Arab counterpart: (As high as 433% more in textile factories employing Jewish and Arab women, and 233% in tobacco factories ⁷). "By July 1937, the real wages of the average Palestinian Arab worker decreased 10% while those of a Jewish worker rose 10%."⁸

The situation resulted in an almost total collapse of the Arab economy in Palestine, primarily affecting Palestinian Arab workers. In his report to the Peel Royal Commission, George Mansour, the Secretary of the Federation of Palestinian Arab Workers in Jaffa, indicated that 98% of Palestinian Arab workers had a "well below average" standard of living. Based on a census covering 1,000 workers in Jaffa in 1936, the Federation had found that the income of 57% of Arab workers was less than PL 2.750 (the average minimum income required to support a family being PL 11); 12% less than PL 4.250, 12% less than PL 6, 4% less than PL 10, 1.5% less than PL 12 and 0.5% less than PL 15.⁹

When the Mandatory Government refused to allow nearly 1,000 unemployed Jaffa workers to hold a demonstration on June 6, 1935, the Federation of Workers issued a statement warning the Government that unless their problems were solved, "the government would soon have to give the workers either bread or bullets."¹⁰ With the conditions of workers continuing to deteriorate, an uprising seemed imminent.

George Mansour (who had been previously a Communist Party member) came out with striking illustrations in his report to the Peel Commission: by the end of 1935, 2,270 men and women workers were unemployed in the city of Jaffa alone, with a population of 71,000.¹¹ Mansour pointed out five reasons for the high unemployment rate, four of which were directly connected with Jewish immigration: 1) the settling of new immigrants; 2) urban migration 3) dismissal of Arab workers from their jobs; 4) the deteriorating economic situation; 5) the discriminatory policy of the Mandatory Government in favor of Jewish workers.¹²

In a period of nine months, the number of Histadrut workers increased by 41,000. According to an Article published in the issue No. 3460 of the newspaper Davar, Histadrut workers numbered 115,000 at the end of July 1936; the official 1936 government report (p. 117) had showed their number at the end of 1935 to be 74,000.¹³

The policy of dismissal of Palestinian Arab workers from firms and projects controlled by Jewish capital initiated violent clashes. In the four Jewish settlements of Malbis, Dairan, Wadi Hunain and Khadira, there were 6,214 Palestinian Arab workers in February 1935. After six months, this figure went down to 2,276, and in a year's time, went down to 617 Palestinian Arab workers only.¹⁴ Attacks against Palestinian Arab workers also took place. On one occasion, for instance, the Jewish community forced a Palestinian Arab contractor and his workers to leave their work in the Brodski building in Haifa. Among those who were systematically losing their jobs were workers in orchards, cigarette factories, mason's yards, construction, etc. . .¹⁵

Between 1930 and 1935, Palestinian Arab pearl industry exports fell from PL 11,532 to PL 3,777 a year. The number of Palestinian Arab soap factories in Haifa alone fell from 12 in 1929 to 4 in 1935. Their export value fell from PL 206,659 in 1930 to PL 79,311 in 1935.¹⁶

It was clear that the Arab proletariat had fallen "victim to British colonialism and Jewish capital, the former bearing the primary responsibility."¹⁷

Yehuda Bauer wrote:¹⁸ "On the eve of the 1936 disturbances, Palestine was possibly the only country in the world, apart from the U.S.S.R., that had not been affected by the world economic crisis; in fact, it enjoyed real prosperity as a result of a massive import of capital (over 30,000,000 in capital had entered Palestine). The imported capital had even fallen short of the necessary funds needed for all the investment programmes." This prosperity, however, was based on rather shakey foundations, which collapsed once the influx of private capital came to an end because of fears of the outbreak of war in the Mediterranean. "The loan system collapsed; there were indications of serious unemployment and construction activity greatly diminished. Palestinian Arab workers were being dismissed by both Arab and Jewish employers, a number of them returning to their original villages; national consciousness was rising due to the aggravating economic crisis."¹⁹

Bauer, however, omits the primary factor: continued Jewish immigration. Sir John Hope Simpson stated in his report that, "It was a bad, and perhaps a dangerous policy, to allow large sums of money to be invested in unprofitable industries in Palestine to justify increased immigration." In effect, Bauer's statement was basically unfounded. since the influx of Jewish capital continued during the years he referred to and, in fact, reached its climax in 1935; the number of immigrants also increased during these years. (Capital invested in Jewish industries and commerce firms increased from PL 5,371,000 in 1933 to PL 11,637,300 in 1936; op. cit. p. 323). Moreover, the dismissal of Arab workers by Jewish employers had begun long before that time.²⁰ In the meantime, large masses of Palestinian Arab peasants were being evicted and uprooted from their lands as a result of Jewish colonization of rural areas.²¹ They immigrated to cities and towns only to face increasing unemployment. The Zionist machine took full advantage of the rivalry between Palestinian Arab workers and their fellow Jewish workers. "Israeli" leftists later observed that not once, in a period of fifty years, were Jewish workers mobilized and rallied around material issues or the struggle of Labor Federation, to challenge the "Israeli" regime itself. "The Jewish proletariat could not be mobilized around its own cause."²²

The fact is that the situation was fully the result of efficient Zionist planning, to recall Herzl's words: "Private land in areas allocated to us must be seized -from its owners. Poor inhabitants are to be quickly evacuated across the border after having secured for them jobs in the countries of their destination. They are to be denied employment in our country; as for large property-owners, they will ultimately join us."²³ The Histadrut summed up its policy by declaring that "to allow Arabs to penetrate the Jewish labor market meant that the influx of Jewish capital would be employed to service Arab development, which is contrary to Zionist objectives. Furthermore, the employment of Arabs in Jewish industries would lead to a class division in Palestine along racial lines: capitalist Jews employing Arab workers; should this be permitted, we would have introduced into Palestine the conditions that had led to the emergence of anti-semitism."²⁴ Thus the ideology and practices that underlined the process of colonization, with the escalation of the conflict with the Arab society in Palestine, were developing fascist characteristics in Zionist organizations; fascist Zionism was using the same tools as the mounting fascism in Europe. The Arab worker was at the bottom of a complex social pyramid and his condition grew worse as a result of the confusion within the Arab labor movement. During the period between the early twenties and early thirties, the progressive labor movement - Arab as well as Jewish - ­suffered crushing blows, which, together with the impact of purely subjective weaknesses, resulted in its virtual paralysis. On the one hand, the Zionist movement which was rapidly becoming fascist in character and resorting to armed terrorism sought to isolate and destroy the Communist Party, most of whose leaders were Jews, and that resisted being contained by Zionist labor organizations. On the other hand, the Palestinian feudal­ religious leadership could not tolerate the rise of an Arab labor movement that was independent of its control. The movement was thus terrorized by the Arab leadership. In the early thirties, the Mufti's group assassinated Michel Mitri, President of the Federation of Arab Workers in Jaffa. Years later, Sami Taha, a trade unionist and President of the Federation of Arab Workers in Haifa was also assassinated. In the absence of a economically and politically strong national bourgeoisie, the workers were directly confronted and oppressed by the traditional feudal leadership; the conflict occasionally led to violent confrontations which were reduced whenever the traditional leadership managed to asssume direct control over trade union activities. As a result, labor activity lost its essential role in the struggle. Moreover, with the sharpening of the national struggle, a relative identity of interests united the workers with the traditional Arab leadership. Meanwhile, the Communist Party occasionally succeeded in organizing political action. On one occasion on May 1st, 1920, a group of demonstrating communists clashed with a Zionist demonstration in in Tel-Aviv and were forced to flee the city and take refuge in the Arab quarter of Manshiya in Jaffa; later a confrontation took place with a British security force that was sent to arrest the Bolsheviks.²⁵ In a statement distributed on the same day, the Executive Committee of the Party declared: "The Jewish workers are here to live with you; they have not come to persecute you, but to live with you. They are ready to fight on your side against the capitalist enemy, be it Jew, Arab or British. If the capitalists incite you against the Jewish worker, it is in order to protect themselves from you. Do not fall into the trap; the Jewish worker, who is a soldier of the revolution, has come to offer you his hand as a comrade in resisting British, Jewish and Arab capitalists. . .We call on you to fight against the rich who are selling their land and their country to foreigners. Down with British and French bayonets; down with Arab and foreign capitalists." ²⁶

The remarkable thing in this long statement was, not only the idealist portrait of the struggle, but also the fact that nowhere did it mention the word "Zionist"; yet Zionism represented to the Palestinian Arab peasants and workers a daily threat, as well as to the Jewish communists, fifty-five of whom were attacked by Zionists in Tel-Aviv and expelled to Jaffa.

The Palestine Communist Party remained isolated from the political reality until the end of 1930, which was the year its Seventh Congress was held. In the resolutions passed by the Congress, the Party admitted that it had "essentially adopted an erroneous attitude towards the issue of Palestinian nationalism, and the status of the Jewish national minority in Palestine and its role vis-a-vis the Arab masses. The Party had failed to become active among the Palestinian Arab masses and remained isolated by working exclusively among Jewish workers. Its isolation was illustrated by the Party's negative attitude during the Palestinian Arab uprising of 1929."²⁷

Although in practice the Party systematically attacked the Palestinian bourgeoisie - which at the time was in a difficult position - and although it never adopted the policy of popular fronts and alliances with the revolutionary classes, the records of the Seventh Congress held in 1930-1931 provide a most valuable political analysis. As shown in these records; the Party considered solving the Palestinian Arab national question as one of the primary tasks of revolutionary struggle: It viewed its isolation from the Palestinian Arab mass movement as the result of a "Zionist-influenced deviation that prevented the Arabization of the Party." The documents mention "opportunist efforts to block the Arabization of the Party." The Congress adopted the view that it was the duty of the Party to expand the cadres of the revolutionary forces capable of directing the activity of the peasants (that is, cadres of revolutionary Palestinian Arab workers.) The "Arabization" of the Party, its transformation into a real party of the toiling Palestinian Arab masses was the first condition of the success of its activity in the rural areas.²⁸

The Party, however, proved incapable of carrying out the task of mobilizing Palestinian Arabs, and the revolutionary slogans adopted by the Congress were never translated into action: "Not a single dunum to the Imperialist and Zionist usurpers," "the revolutionary expropriation of land belonging to the government, to rich Jewish developers, Zionist factions and big Arab landowners and farmers," "No recognition of agreements on the sale of land," "the struggle against Zionist usurpers."²⁹ The Congress had also decided that "it is possible to solve all the burning issues and end oppression only through armed revolution under the leadership of the working class."³⁰ The Palestine Communist Party was thus never "Arabized." The field was open for the domination of the Palestinian Arab mass movement by the feudal and religious leaderships. Perhaps one reason behind the line and practices of the Party at that time was the uncompromising revolutionary attitude for which the Comintern was famous between 1928 and 1934. But despite their small number, their relative isolation and their failure to reach the Palestinian Arab masses, particularly in the rural areas, the communists threw all their weight into the 1936 revolt. They showed great courage, cooperated with some of the local leaders, and supported the Mufti; many of them were killed and arrested. But they did not succeed in becoming an influential force. Apparently the slogan of "Arabization" got lost somewhere later on; nearly ten years later, on January 22, 1946, Izvestia dared to compare the "struggle of the Jews" in Palestine with the Bolshevik struggle before 1917.

In any case, the resolutions of the Seventh Congress of the Palestine Communist Party have only been revealed recently; the process of Arabization did not take place, and despite the educational role played by the Party and the contributions it made to the struggle in this field, it did not play the role projected for it by its Seventh Congress in the Palestinian national movement at that time. During the 1936 revolt the Party split. There was also another fundamental split in 1948, and another in 1965, for reasons connected with Arabization; the dissidents advocated a "constructive" attitude towards Zionism.

This failure of the Communist Party, the weakness of the rising Arab bourgeoisie and the disunity of the Arab labor movement meant that the feudal-religious leaderships were cast to play a fundamental role as the situation escalated to the point of explosion in 1936.