Of course the new levels of citizenship don't recognize the existence of Muslims, so the religion of Islam either isn't noticed legally in Israel, or it is something that inherently resides in being an Arab. In Israel all Arabs are Muslims; but are all Muslims Arabs? Try asking this question in Pakistan, Indonesia or Bosnia. This obviously fails the syllogism test (should we conclude that "all men are Socrates?")
If something seems scrambled-up here you are right.
What is this business of creating a hazy melange of religions, supposed nationalities and an actually vague classification of "Arab," which, like "Semite," is not a nationality, or a religion, or, for that matter, really a race? And what does it tell us about Israel and our (USA citizens, or French or Mexican or any other "normal" country) understanding of what citizenship is?
And since when is Christian a nationality?
The only definition of Arab (or Semite) that holds water is that of a language group. Arabs are native Arab speakers. If you compare the people in, for example, Yemen, Lebanon, and Morocco you will see national differences in culture, but they all speak Arabic (but the accents may vary so much that there are areas of mutual incomprehension.) So can you take a Yemeni and put him in Beirut or Cairo and say "it's all the same, Arabs are interchangeable? We have blue eyed fair skinned Arabs and very dark brown eyed Arabs (and then there are Berbers). Can you say it doesn't matter if you take a Chilean from Santiago and put him in a village in Paraguay? They all speak Spanish, right?
If you define all Semites as native speakers of a Semitic language, this group would include some Jews, some Arabs, and speakers of the languages of Ethiopia and Somalia.But this kind of definition is restricted, clear and scientifically correct but not politically useful, so forget about it.
In the USA a person who is born here is a citizen with equal rights (on paper, anyway) to every other citizen. A person who is a citizen of another country can become a US citizen. That's it! No differing levels of legal status, no carrying of internal ID papers designating religion, race or nationality which indicate how the individual is to be treated. This is what we normally think of when the word citizenship comes up.
Israel, being the state of Jews only, has another system. Everyone is not legally equal. Only Jews have an unrestricted right to buy and own land. Arabs can't be in the army, and in a military centered country such as Israel, not having discharge papers can cut you off from benefits and job opportunities. There are several other laws in Israel that specify rights to Jewish citizens that are denied to all other citizens.
This situation may be called many things, but it can't be called remotely democratic (then there's the outright military occupation of the West Bank where non-Jews are subject to martial law).
The premise of Zionism, and Israel, is that Jews are a nation. This idea of a Jewish nation stems from the 19th century European romantic movement that posits an ideal of ethnic purity: one people, one blood, unsullied by alien elements. This concept is disturbingly similar to the Germanic racialist idea of a Volk. In many ways Zionism is a flip-side of European anti-Semitism.
What counts in Israel is nationality. The status of Israeli citizen doesn't give anyone rights--for rights you need to be the correct nationality.
Jews get democracy. The Druze, a small monotheist sect different from the Islamic and Jewish religions has been given a separate status different from Arabs; they have more rights than Arabs, who are at the bottom. Why do this? From the viewpoint of the Israeli state it's simple: divide and conquer. It fosters divisions among the non-Jewish population and makes them more manageable.
Now Israel is trying to separate Christians from their Islamic fellow Palestinians. The government hopes to split Christians away and buy them off with special treatment. Until now Christian and Muslim Palestinians have been equally robbed of their rights and land. Many Christians have participated in protests and support the Boycott, Divestment and Sanctions campaign.
Christian leaders in Israel have seen through this rather cheesy ploy. They share the same conditions as their Muslim brothers and sisters and know that Israel's long term campaign of land theft and ethnic cleansing is aimed squarely at them, no matter what questionable changes in status are given to them by their oppressors.