[fredhead]

I still recall, while on a tour in Israel during a Navy port call in 1981, the tour guide telling us how the Jews “allowed” the Palestinians to live there but not to serve in the military or to hold public office.

How that attitude had changed since the founding of Israel (if this article can be believed).

[rmlew]

I'm not sure that your tour guide could entirely be believed.
ARab's own more private land than Jews.
Arabs can and do serve in the military, although these are primarily Bedouin and Druze. Other Arabs can serve, but doing so puts their families at risk.