Netanyahu needs a them so people wont question his clinging to power.

This is true but really not the fundamental issue. Zionism was born before him and will die after him. Without understanding the economic basis of fascism and other reactionary social formations, all you can do is produce silly stories like this. Israel is a settler-colony, it is economically (and existentially) dependent on the deprivation of the people whose land it took and continues to take.