It was actually a controversial dilemma among early Zionists in the Yishuv since many understood that things would get permanently more complicated if Arabs are even "permitted" as an underclass, as their planned Jewish state will eventually come to rely on them as an exploitable labor force among other things. It's the same way that the South African government trying to "separate an omelette" with Apartheid, as the last President before its dismantlement pointed out.