There were a lot of different kibbutz types and many hired Arab workers. Some of the attacked kibbutzes last year even still had Arab workers from Gaza (not since though).

Here's an interesting article (paywalled though) on the subject

a western colony

Israel grew out of an existing jewish presence, and the first waves of immigrants came from Russia and Yemen, while under Ottoman control. Whoever told you it's a 'western colony' was lying to you

where the money was

Most arrived with nothing and worked long hours in collectivist communes

The arabs never expelled anybody.

You can find some nice sourced examples in here

And again: where do you suggest they should have moved?