srael's restraint in this sphere-which turned out to be desperately misguided-is only part of the story. The larger part, still untold in all its detail, is of the astounding social and economic progress made by the Palestinian Arabs under Israeli "oppression." At the inception of the occupation, conditions in the territories were quite dire. Life expectancy was low; malnutrition, infectious diseases, and child mortality were rife; and the level of education was very poor. Prior to the 1967 war, fewer than 60 percent of all male adults had been employed, with unemployment among refugees running as high as 83 percent. Within a brief period after the war, Israeli occupation had led to dramatic improvements in general well-being, placing the population of the territories ahead of most of their Arab neighbors.

In the economic sphere, most of this progress was the result of access to the far larger and more advanced Israeli economy: the number of Palestinians working in Israel rose from zero in 1967 to 66,000 in 1975 and 109,000 by 1986, accounting for 35 percent of the employed population of the West Bank and 45 percent in Gaza. Close to 2,000 industrial plants, employing almost half of the work force, were established in the territories under Israeli rule.

During the 1970's, the West Bank and Gaza constituted the fourth fastest-growing economy in the world-ahead of such "wonders" as Singapore, Hong Kong, and Korea, and substantially ahead of Israel itself. Although GNP per capita grew somewhat more slowly, the rate was still high by international standards, with per-capita GNP expanding tenfold between 1968 and 1991 from $165 to $1,715 (compared with Jordan's $1,050, Egypt's $600, Turkey's $1,630, and Tunisia's $1,440). By 1999, Palestinian per-capita income was nearly double Syria's, more than four times Yemen's, and 10 percent higher than Jordan's (one of the betteroff Arab states). Only the oil-rich Gulf states and Lebanon were more affluent.

Under Israeli rule, the Palestinians also made vast progress in social welfare. Perhaps most significantly, mortality rates in the West Bank and Gaza fell by more than two-thirds between 1970 and 1990, while life expectancy rose from 48 years in 1967 to 72 in 2000 (compared with an average of 68 years for all the countries of the Middle East and North Africa). Israeli medical programs reduced the infant-mortality rate of 60 per 1,000 live births in 1968 to 15 per 1,000 in 2000 (in Iraq the rate is 64, in Egypt 40, in Jordan 23, in Syria 22). And under a systematic program of inoculation, childhood diseases like polio, whooping cough, tetanus, and measles were eradicated.

No less remarkable were advances in the Palestinians' standard of living. By 1986, 92.8 percent of the population in the West Bank and Gaza had electricity around the clock, as compared to 20.5 percent in 1967; 85 percent had running water in dwellings, as compared to 16 percent in 1967; 83.5 percent had electric or gas ranges for cooking, as compared to 4 percent in 1967; and so on for refrigerators, televisions, and cars.

Finally, and perhaps most strikingly, during the two decades preceding the intifada of the late 1980's, the number of schoolchildren in the territories grew by 102 percent, and the number of classes by 99 percent, though the population itself had grown by only 28 percent. Even more dramatic was the progress in higher education. At the time of the Israeli occupation of Gaza and the West Bank, not a single university existed in these territories. By the early 1990's, there were seven such institutions, boasting some 16,500 students. Illiteracy rates dropped to 14 percent of adults over age 15, compared with 69 percent in Morocco, 61 percent in Egypt, 45 percent in Tunisia, and 44 percent in Syria.

ALL THIS, as I have noted, took place against the backdrop of Israel's hands-off policy in the political and administrative spheres.