Israel is at risk of internal collapse or civil war because of tensions among Israelis, an August report by CIA experts tasked with providing “alternative analysis” said, according to a report by Drop Site News published on Monday. 

The CIA report, titled “Fracture From Within”, said that Israel faces a volatile situation ahead of 27 October elections, where Israeli Prime Minister Benjamin Netanyahu will be fighting for his political future.

The authors noted that one of the most divisive Israeli political issues is the long-standing exemption from military service that ultra-Orthodox Israelis enjoy. 

The row has exposed deep divisions within Netanyahu’s right-wing bloc and raised questions about whether he will have the support of two ultra-Orthodox parties: United Torah Judaism (UTJ) and Shas – his most dependable allies since he first became prime minister in 1996.

While hundreds of thousands of reservists have been mobilised for Israel’s genocide in Gaza and wars on Lebanon, Syria and Iran, ultra-Orthodox men have historically been exempt from compulsory military service in order to pursue full-time religious studies in yeshivas. 

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The arrangement has long been contentious, but the war has intensified pressure to end the exemption.

Netanyahu’s coalition has repeatedly failed to pass legislation regulating ultra-Orthodox enlistment, leading to the detention of dozens of young men accused of evading military service and triggering mass protests backed by UTJ and Shas.

The report also noted that Israel faces tens of thousands of heavily armed veterans trying to assimilate back into civilian life. Israeli reservists can maintain their weapons at home, and carrying assault rifles in public is common in Israel.

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Another factor that could drive instability in Israel is rising settler violence in the occupied West Bank and East Jerusalem, along with food inflation and the soaring cost of military spending, the report said.

Drop Site said that the CIA report was produced by the Red Cell, a semi-independent unit within the agency specifically designed to propose contrarian ideas and challenge basic assumptions and biases.

The report honed in on the pressures building ahead of an election that experts say may not produce a conclusive outcome. Polling in Israel suggests that neither Netanyahu nor the blocs opposed to him may reach the 61 seats required to form a government in parliament.

The authors also “gamed out” how these pressures could spark civil conflict. One precipitating event could be if foreign technology and AI companies limit their investments and hiring in Israel. Another would be if regional governments decided not to normalise or continue relations with Israel.

The article appeared to focus only on fissures among Israelis and did not take into account the tensions among Palestinian citizens of Israel, who account for 20 percent of the population and face discrimination.

On Friday, a Palestinian politician with Israeli citizenship dropped out of the upcoming parliamentary election after Israel’s Supreme Court suggested it would disqualify him from running. The court overturned bans on four other political parties of Palestinian citizens of Israel.