Rentier states are states where control of a valuable resource provides the state with entirely sufficient amounts of money to operate without a tax base. It is hypothesized that political change in such states will be slow or nonexistent because 1) citizens have little stake in a government that demands nothing of them and 2) the state has resources to co-opt or coerce compliance from its population. Like Saudi Arabia.
Israel is being increasingly described as an Apartheid state because it effectively holds sovereignty over Palestine. I am a proponent of this perspective because, after forty years of occupation in different forms, any model that sees the two sides as warring (or even colonizing) neighbors becomes insufficient.
Add to that, however, the qualities of a rentier state which the state of Israel derives from its "special relationship" with the United States, and you have a very grim prognosis. I would strongly suggest adding this model to the way we think of Israel, to explain Israeli arrogance, stagnation in the peace process, and the role of the United States in perpetuating the system.
Update: A commenter pointed out that military aid only comes to like 2% of GDP... hmm. My model doesn't work at all. Thanks for the input.