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They can't leave because Gaza is surrounded by a huge heavily fortified wall. Those that come close to it get shot. One of the creepiest parts is that most of Gaza has never actually seen an Israeli in person in their life.
The land is mostly worthless. It's been bombed for decades and the Israelis gave up on it almost 20 years ago. It's only important strategically for Israel's desire to be a Jewish ethnostate (something Netanyahu has talked openly about). This stretch of land can act as a prison to keep undesirables out. And obviously, residents of Gaza don't want to be imprisoned and want freedom to leave, have better living conditions, and return to their homes.
The land that Israel actually wants is the West Bank. They've been slowly annexing portions and at some point, a big clash will occur. That's been where their focus has been which is why this caught the country so off guard.
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