It's not feasible for Israel to set up a makeshift refugee camp in their borders. Especially as Hamas operatives don't wear uniforms, which is a war crime in itself. That would leave Israel with hundreds of thousands of people to monitor. A population that would almost certainly include hostiles and a population that has a history of getting whipped up into blood thirsty riots. The logistics of that would be insane and only put Israel in a worst position in terms of potential human rights violations.
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