It is widely predicted that Israeli prime minister Benjamin Netanyahu’s fractious, rightwing ruling coalition will not survive acceptance of an extended Gaza ceasefire and hostage-release deal with Hamas, as tentatively proposed by Arab mediators last week. Far-right politicians such as the national security minister, Itamar Ben-Gvir, are vowing to collapse the government rather than condone what they claim would be a victory for terrorism after the 7 October atrocities. Opponents fervently hope they carry out their threat. War cabinet members Benny Gantz and Gadi Eisenkot regard the hostages’ safe return as the top priority. Although Netanyahu continues to insist on Hamas’s utter destruction and long-term control of Gaza, they will not allow him to block a US-backed deal indefinitely. This impasse comes as no surprise. It is symptomatic of a more fundamental national schism, evident before the Hamas massacre and greatly exacerbated thereafter. A broadly existential struggle is being waged over the country’s democratic character, future leadership, relationships with the Palestinians and the Arab states, and international standing. Israel, it seems, has reached an inflection point – what some call a “point of no return”. As the world knows, the years since Israel’s founding in 1948 have been marred by the failure to create a Palestinian state with equivalent sovereign rights. But what if today’s infighting, fuelled by ultra-religious Jewish supremacists, foreshadows the failure of Israel’s national project, too? What if the quest for a two-state solution concludes, ironically, with no functioning democratic state on either side? This is not a wholly outlandish question. For months before 7 October, Israel was rocked by unprecedented popular protests against Netanyahu’s bid to “reform” the judicial system and other controversies. He was accused of mounting a “constitutional coup” and flouting basic democratic principles. President Isaac Herzog warned repeatedly of civil war. Fears for Israel’s democracy have deepened since the Gaza war began. Netanyahu has refused to resign, allow fresh elections or take personal responsibility for 7 October security failings. Recent polling suggests most Israelis are unhappy with him and his war cabinet’s diktats – and want an immediate 7 October inquiry. A majority also opposes releasing large numbers of Palestinians to secure the hostages’ freedom. Polarisation within Israeli society plumbed new depths last weekend. At a Jerusalem rally, thousands of rightwingers, including Ben-Gvir, finance minister Bezalel Smotrich, government MPs, rabbis and soldiers, called for Jewish resettlement of Gaza and expulsion of Palestinian residents. “If we don’t want another 7 October, we need to go back home and control [Gaza]. We need to find a legal way to voluntarily emigrate [Palestinians] and impose death sentences on terrorists,” Ben-Gvir said. “We are rising, we have a nation of lions,” said Smotrich. Haim Katz, a minister from Netanyahu’s Likud party, was in messianic mood: “Today, we have the opportunity to rebuild and expand the land of Israel. This is our final opportunity.” Condemnation from the left was fierce. The government had shown its “true colours”, wrote analyst Alon Pinkas in Haaretz. “This was the coalition in an orgy of anti-state and anti-democratic euphoria... What you saw was not merely a theocratic-fascist strain in Israeli society and politics but [in] almost half of Netanyahu’s coalition... Religious-nationalistic Jewish supremacy has been normalised, legitimised, mainstreamed and encouraged by Netanyahu,” he claimed. It’s plain the state of Israel, as a modern-day entity, is experiencing a brutal, illusion-shattering coming of age Netanyahu’s thwarting of US president Joe Biden’s efforts to reduce civilian casualties and increase aid to Gaza, and his stark rejection of Washington’s preferred two-state solution, reinforces the sense of a turning point being reached. Defying an American president at such a juncture is a desperate strategy. Sensible Israelis know that, for them at least, the US really is what Madeleine Albright called the “indispensable nation”. Likewise, all but the most idiotic headbangers realise the international court of justice’s careful warning about the perils of genocide in Gaza cannot simply be dismissed. The ruling reflects how world opinion has been repelled by the Gaza carnage. The percentage of people globally who view Israel positively dropped by an average of 18.5% between September and December, decreasing in 42 out of 43 countries, a recent survey found. Israel’s internal divisions and international isolation are real and growing. To the delight of Iran and like-minded foes, Netanyahu’s perpetual war promises deeper rifts and greater ostracism. Commentators warn gloomily of street battles between rightwing zealots and hostage families, of a democratic breakdown. It’s unlikely to come to that. Israelis will survive this crisis, although the prosperity of recent years may be hard to reproduce. They have many strengths to draw on – economic, technological, military – and, not least, their history, courage and resilience. Yet nearly a century on from the nightmare that preceded its birth, it’s plain that the state of Israel, as a modern-day entity, is experiencing a brutal, illusion-shattering coming of age. Historically speaking, civil strife and external threats have often forged the identity and character of nation states. Israel today is no exception – and that’s the key lesson of this momentous inflection point. It has no inborn right to act in defiance of international norms and laws. Its problems and challenges are not unique. Occupation is toxic to security, legitimacy and recognition. An independent Palestinian state is necessary, desirable and inevitable. For their country to flourish, more Israelis must accept these truisms – and reject governments and leaders who believe and behave otherwise. “There is a liberal-democratic majority in Israel. The ultranationalists, extremist Orthodox Jews and settlers are the minority,” Pinkas wrote. “Now that the majority of Israelis have caught a clear glimpse of the future and realise what’s in store, they may have to make a choice.” The choice is between a successful, inclusive democracy at peace with its neighbours and a nation sliding into authoritarianism or worse, forever under siege. Simon Tisdall is the Observer’s foreign affairs commentator