French company Veolia has announced that it has decided to end its contract to run a planned Israeli rail network that would connect Jerusalem with illegal Israeli settlements in the occupied West Bank.

The French company came under pressure by pro-Palestinian groups to not contract with work in the occupied territories. Several other European industry firms had already turned down work in Israel in opposition to the occupation and in support of the Palestinian people.

It is unlikely that pro-Palestinian lobbying was decisive. Organizations in support of the Palestinians have already made their opposition know for sometime. It was prospect of losing billions of dollars worth of contracts in the Persian Gulf rail development plans that convinced Veolia to forgo Israel, rather.

The recent action by Veolia can be seen as part of a broader trend that is isolating Israel in the world of business and public opinion. The brutalities and immorality of the occupation is vividly seen on the television screens of Europeans - unlike in the pro-Israel U.S. - and has made Israel an increasingly toxic country to do business in.

Smart Israelis recognize this and the need to pursue a two-state solution with Palestinians for the occupation is turning their country into an ever more xenophobic, fundamentalist, isolated state. Unfortunately, other powerful Israelis would trade Israel’s status for a few hilltops in the West Bank because that’s “Judea” and the Jews were given the land, so they say, by God.

Such an ideology is self-destructive. Can Israel save itself from itself?