Palestinian living conditions

Philip Greenspun says:

On foreign policy Howard Dean complains that the Bush Administration has "disengaged" from meddling in the 55-year-old war between the Arab nations and Israel.  His proposed solution?  "The Israeli government will have to work to improve the living conditions of the Palestinian people".  This is a tough goal given that the Palestinians have a 5% annual population growth rate; the Israelis would have to somehow generate more than 5% annual GDP growth among the Palestinians, many of whom are illiterate (a 5% annual GDP growth rate is something that we Americans are unable to achieve for ourselves, despite the fact that we have almost unlimited capital and a well-educated citizenry).

Now that's an interesting point. Is an unhealthily high population growth rate a key factor behind for the poor living conditions of Palestinians?

I personally have no idea what the truth of this is, but I'll be looking out for more information on this in the future.