First, I'll cite the passage in question, then the response.
Firstly, for Palestinians, occupation and the policies that support it, stunt their ability to grow in every conceivable way. The confiscation of Palestinian land, constraining their access to their water and other natural resources, the imposition of obstacles to the free movement of people and goods, and structural impediments to employment and economic self-management all combine to thwart the emergence of a viable economy and a secure independent state. Moreover, the expansion of illegal settlements, the frequent use of excessive force against Palestinians and the denial of their most basic human rights further circumscribe their potential to build human development. The plight of Palestinian refugees living in other countries is a further manifestation of development disfigured by occupation.Seems fairly mild- occupation, even if necessary, is playing merry hell with the Palestinian economy (such as it is), and the governments in the region are obsessed with the occupation and are therefore aiming criticism away from their regimes. This obsession could be a false front (and it probably is), but that's unimportant at the moment.
Secondly, occupation casts a pall across the political and economic life of the entire region. Among neighbouring countries, some continue to suffer themselves from Israeli occupation of parts of their lands, subjecting those people directly affected to tremendous suffering, and imposing development challenges on the rest. In most Arab states, occupation dominates national policy priorities, creates large humanitarian challenges for those receiving refugees and motivates the diversion of public investment in human development towards military spending. By symbolizing a felt and constant external threat, occupation has damaging side effects: it provides both a cause and an excuse for distorting the development agenda, disrupting national priorities and retarding political development. At certain junctures it can serve to solidify the public against an outside aggressor and justify curbing dissent at a time when democratic transition requires greater pluralism in society and more public debate on national development policies. In all these ways, occupation freezes growth, prosperity and freedom in the Arab world.
And now the response:
To summarize, Israel is to blame: human development among Palestinians is all but impossible under Israeli occupation, and, moreover, the Israeli-Palestinian conflict contributes to delays in democratic change. The obvious refutation is this: until 1967 there was no “illegal occupation” but the situation in Arab countries was essentially the same with regard to education and human development in general. One may also ask, how it is possible that the conditions of 1% of Arabs in a single “country” are responsible for the miserable conditions of the other 99% in 21 countries?Huh? Nothing above supports this. Yes, occupation is certainly messing up human development in Palestinian lands... the assertion that it wouldn't is ludicrous. The question of whether the occupation is necessary in order to protect Israeli interests is a valid one, but the economic and humanitarian effects can hardly be in question- it can be both necessary and an economic and humanitarian nightmare. (Such is warfare.) And as to the question of the other regimes... please. First, the above section already answered "how they could be responsible"... they're a distraction to governments and to their subjects/citizenry, leading to bad policy and worse governance with a population that isn't doing anything about it. Second, trying to equate 1967 and 2002 just might possibly be a bad idea, as things have changed somewhat in those intervening years... not the least aspect being that the Nasserian quasi-socialist systems that dominated in the region have had the rug pulled out from under them with the collapse of the Soviet Union (as well as the military and economic support that that superpower might once have provided) as well as much lower oil prices, growing Islamic militancy, and the simple differences in the cultural environment. The important thing is to understand what the influences are right now, and the occupation, for better or worse, certainly counts as one of those influences.
This comes down to a fundamental problem that many people have- they seem curiously unable to distinguish between acts that are evil and wrong and acts that are necessary and good but involves wrongs as well. To note the economic effects of the occupation does not necessarily place it in the former category- it could be (and probably is) the latter, with the usual mixture of positive and negative effects that you'd expect from any event. This problem is at the root of this hysterical reaction to what is a fairly benign exploration of the problems associated with the occupation. I realize that CitCun is pretty obviously pushing an agenda, but they should really work a little harder, because right now it's pretty weak.