Israel can hardly be expected to deliver funds to a Hamas government whose ultimate aim is to destroy it. Israel and the international community--the United States, European Union, United Nations and others--may differ on the timing of the imposition of sanctions and their severity, but not regarding the principle. With the swearing in of the new PA Legislative Council, Israel proclaimed that it would no longer transfer customs and VAT collected on behalf of the PA, whereas diverse international actors are waiting for a Hamas cabinet to be formed. Israel is withholding only taxes at this point; others are looking for ways to transfer funds to non-Hamas NGOs or to institutions under the control of President Mahmoud Abbas rather than Hamas.

This approach is laced with contradictions. Logically speaking, why allow Palestinian imports to pass through Israeli ports on their way to Gaza and the West Bank, but withhold the excise taxes levied on these imports? Is the international community not fooling itself that it is possible to turn over funds to Abbas and to select NGOs and ministries without ultimately helping the Hamas government? Will political and economic pressure really force dedicated Islamists to recognize Israeli sovereignty over what they deem to be sacred Islamic lands? Alternatively, does anyone really believe that Israel will allow Palestinians to starve or even, in the unsavory words of the prime minister's adviser, Dov Weisglass, to be forced to "diet"?

If, by withholding funds, Palestinians are indeed made to suffer (more than they already do), what guarantee do we have that this will turn them against Hamas and cause them to return Fateh to power? Have earlier attempts to impose economic sanctions actually made Palestinians more moderate? The argument is offered that Palestinians did not vote for Hamas because of its extremist platform regarding Israel, but rather in order to protest against Fateh's corruption and inefficiency. Then why didn't they vote in larger numbers for Salam Fayad and other secular reformers who ran in the elections?

Withholding donor and tax funds and blocking Palestinian exports and imports are not new tactics. They were tried, with little effect, during the Arafat era and the second intifada. In the present case, they bear the added disadvantage of being perceived as punishing Palestinians for making a democratic choice. We must accept that it is now too late to turn back the clock on the outcome of these elections. A Hamas government is the Palestinian will.

Hence the real question we have to ask ourselves is, can anything make Hamas substantively (rather than tactically) modify its platform regarding Israel? If financial pressure is likely to fail, could peer pressure from fellow Arabs be more successful? Could inducements ("carrots") offered in parallel with financial pressure ("sticks") be effective, or will they merely be seen as a sign of weakness?

The truth is, we simply don't know. This is the first democratically-elected Islamist government allowed to take office in the Arab world, and there are no precedents for dealing with it, particularly when we factor in the conflict with Israel. (There is a precedent for preventing such a government from taking office, in Algeria some years ago. It caused untold suffering. Neither the PA security establishment nor Israel is likely to follow the example of the Algerian army.)

One additional truth is very relevant in this context. Most Israelis ceased looking for a viable Palestinian partner for immediate peace negotiations several years ago, in the aftermath of the collapse of the Oslo process and the Palestinian decision to adopt the strategy of suicide bombings. The advent of Hamas to power in Ramallah and Gaza has merely reinforced the inclination of a majority of the Israeli public to build a strong fence, remove outlying settlements, and opt for demographic security, and to do it all unilaterally. Even the knowledge that disengagement from Gaza strengthened Hamas does not deter Israelis intent on getting out of what is perceived to be a counter-productive occupation, a disastrous messianic settlement enterprise and a Palestinian demographic trap.

This is the likely Israeli agenda for the next few years. It can be accomplished vis-a-vis a Hamas government or a Fateh government, though obviously a Fateh government could offer modes of coordination that Hamas presumably would disdain, and removal of West Bank settlements in the Hamas era might not involve removal of the IDF from the territories in question.

Thus economic sanctions as a means of punishing, weakening, reforming or even toppling a Hamas government are not the central issue. It is more important and more feasible to isolate the Hamas phenomenon while Israel proceeds with its agenda. For this we need close cooperation with Egypt and Jordan. And we must persuade Washington to cease sponsoring democratic elections in which armed Islamist militias are allowed to participate. This is the principal root of the current evil, not only in Palestine but in Iraq and Lebanon as well.- Published 27/2/2006 © bitterlemons.org

Yossi Alpher is coeditor of the bitterlemons family of internet publications. He is former director of the Jaffee Center for Strategic Studies at Tel Aviv University and was a senior adviser to PM Ehud Barak.

A PALESTINIAN VIEW Sanctioning the people

by Ghassan Khatib

In general, economic sanctions have not proved particularly effective in achieving political goals around the world. The Palestinian case is not likely to prove an exception.

Ever since Hamas won elections for the Palestinian Legislative Council, the international donor community has debated imposing sanctions on the Palestinian Authority--in the form of withholding funding--and has loudly proclaimed its position to the Palestinian people.

The US has already stopped its funding and even withdrawn previously given aid. Israel has stopped transferring the monthly monies it collects on behalf of the PA in the form of taxes on imports through Israeli ports to the Palestinian private sector.

The rest of the world, including major donors like the EU, individual European states, Japan and international organizations including the UN and the World Bank, have decided to continue funding ongoing projects, and postponed a decision of stopping funding completely until after the possible formation of a Hamas government.

Most Palestinians, including opponents of Hamas, will argue that economic sanctions against Palestinians--whether the PA or other institutions--will simply lead to further economic and social deterioration. This will also constitute collective punishment of the Palestinian people as a whole. Together, these factors will contribute to the process of radicalization in Palestinian society. The statistical correlation between increasing poverty and increasing political and ideological radicalization is well corroborated.

Further, economic punishment will also create public sympathy for Hamas and further reinforce its popularity. The Palestinian public simply cannot grasp the justification proffered for such sanctions, since Hamas won free, fair and legitimate elections that were organized by the Fateh-dominated PA and monitored by credible representatives of the international community.

Some members of the international community are trying to differentiate between ending funding to the PA on the one hand and maintaining humanitarian assistance to the Palestinian people on the other. It might be useful here to point out that just over 90 percent of non-security related public expenditure in the Palestinian Authority's budget goes to humanitarian projects, particularly health, education and social protection, i.e., homes for the elderly and orphans and efforts to combat extreme poverty.

Indeed, 75-80 percent of the non-security employees of the PA work within the health, education and social protection fields. The health and education sectors in Palestine happen to be almost completely governmental services. Ninety-nine percent of all educational services are governmental. More than 95 percent of the primary health care sector and more than 80 percent of secondary and tertiary healthcare is governmental.

In other words, imposing sanctions on the PA will lead to the collapse of the health and education services, which, aside from security expenditures, are what the PA primarily supports. Such a collapse might happen sooner than the donor community is calculating since these sectors are financially fragile and cannot absorb much financial pressure for long.

If the international community is interested in maintaining humanitarian assistance to the Palestinian people, these are calculations that must be factored in. If funding to the PA should be ended, there is a need for an alternative structure that does not presently exist to replace the PA in these regards. That will take time to create. We have already witnessed frightening examples in other parts of the world of what happens when government structures collapse with no alternatives in place. Decades of significant human suffering have ensued while such structures were rebuilt.

The Palestinian case has additional potential consequences. According to international law, responsibility for the Palestinian situation, particularly the humanitarian situation, lies with Israel as the foreign military occupying power. Having failed to help Palestinians achieve self-determination and statehood as per relevant UN Security Council resolutions, and having instead indirectly or directly supported the occupying power, the international community too has a certain level of responsibility for securing the humanitarian needs of Palestinians.- Published 27/2/2006 © bitterlemons.org

Ghassan Khatib is coeditor of the bitterlemons family of internet publications. He is the Palestinian Authority minister of planning and has been a political analyst and media contact for many years.

AN ISRAELI VIEW Throttle a Hamas government financially

by Hillel Frisch

Finally there is an issue all Israelis, left and right, and the principal western states can rally around: to throttle a Hamas government financially until it acknowledges Israel's right to live as a Jewish state, disavows in an official document the use of violence in settling the Israeli-Palestinian and Israel-Arab conflicts, and dismantles its military arm.

Not only is there an imperative to do so, but such a policy must be applied immediately. Hamas and other factions are developing the capabilities of hitting at major strategic objectives in and around Ashkelon, thereby increasing the prospects of a mega-catastrophe. Israel's reaction will be massive, resulting in complete disintegration of the Palestinian Authority and Palestinian political and social anarchy. In such circumstances, any possibility of negotiations will be delayed for years, and Palestinian hardship will finally reach levels Palestinian propagandists attribute erringly to the present situation.

A hard-line policy will not only avert disaster but potentially create the seeds for peace. Hamas is a pragmatic organization that recognizes power for what it is, behaving rationally rather than being dominated by sentiment and affect. It knows that the world is dominated by a superpower, and therefore refrains from allying with al-Qaeda and from engaging in international terrorism, and takes pains not to harm American and western citizens locally even though it would love to do all three. Intensive Israeli and international pressure could possibly draw from the organization the more critical concessions outlined above.

Given a choice between promise and pitfall, even the most ardent dove should be aware of the critical importance of adopting a hard-line policy.

Being hard in order to be soft is of course difficult and counter-intuitive. So difficult has the task been that incumbent Israeli policy-makers have already raised three reservations to throttling the PA after the Hamas victory. Some have warned that President Mahmoud Abbas (Abu Mazen) and his security apparatuses will fall, others have claimed that the axis of evil, Iran and al-Qaeda, will fill in the financial void, and still others point to the moral difficulty of stopping humanitarian aid.

None of these claims are justifiable in stopping aid to the PA.

Abbas, many of us assumed, was a consummate player who had cleverly weakened his own side and strengthened the opposition in order to play off the two sides. The elections proved how unsuccessful he was in applying the strategy. With each succeeding day Abbas is proving to be the Palestinian Gorbachev, a spokesperson for the factions justifying the terror they engage in rather than leading the PA and his people, as his title of president should suggest. And with his fall, the Fateh faction and militia(s) he so ill-served seem to be beyond repair. "You can't kick a dead horse" should be our response.

As for the specter of Iranian aid, there is no reason that the security services of Jordan, Egypt and Israel cannot prevent the flow of a hundred million dollars a month--a very sizeable and traceable amount--to the small Palestinian economy. More important, they should have all the interest in the world to do so. Tracking down the couriers is even simpler. Past Iranian involvement in Palestinian terror, substantial but nevertheless limited, serves as ample proof of the difficulties of transferring funds of such magnitude.

Even stopping some of the discretionary international aid will have a significant impact. This aid is equivalent to one-third of the Palestinian GDP and probably half of total economic activity, due to the multiplier effects such inflows have on the Palestinian economy.

How such a contraction in the Palestinian economy will affect Hamas was already tested in 1996, when Israel for the first time prevented Palestinian labor for prolonged periods of time from reaching the Israeli labor market. Withdrawing that carrot led to tremendous pressure on Hamas to desist from acts of terrorism. Such a policy should be all the more effective as Hamas now bears responsibility for the welfare of all Palestinian society.

As for the international aid argument, these donations are not a birthright, and most international aid is political rather than humanitarian. The Palestinians are the second largest recipients of international aid in the world. Were aid strictly humanitarian and based on objective criteria of need they would hardly deserve any. Even after five years of violence, the PA ranks 102 in the United Nations' Human Development Index out of 189 states on the list, hardly a position at the bottom of the heap. Nearly half of humanity, including citizens of Syria, Egypt, Sudan and Morocco are worse off. If the Palestinians want international aid they should be made to live up to international accountability by disavowing terrorism and recognizing a member state in the UN.

Ironically, it is cutting off international aid to the PA under Hamas that is humanitarian, given the possible catastrophic effects that continued terrorism directed against Israel may visit on the Palestinians.- Published 27/2/2006 © bitterlemons.org

Hillel Frisch is a senior researcher in the BESA Center for Strategic Studies, Bar-Ilan University, and the author of books and articles on Palestinian and Arab politics.

A PALESTINIAN VIEW Eye of the storm

by Ghazi Hamad

Hamas has responded to international threats to withhold or end funding to the Palestinian Authority with a certain measure of calm. There are several reasons for this.

First is the question of principle. Hamas is not ready to sell its political positions for money. That is something the world should understand. In the Palestinian case money cannot, and should not, be the first priority. The cause of Palestine is first and foremost a political cause and not a case of alleviating poverty.

Secondly, on a psychological level, Palestinians have lived under miserable conditions for a long time. They have survived, grown stronger and more steadfast under these conditions. Palestinians, as were evidenced by the recent elections, primarily want to see clean and efficient governance by a group of people dedicated to the interests, security and political aspirations of the people.

On a practical level, with or without funding, there is a lot of room for improving and streamlining the financial performance of the PA. An effective program to combat corruption and a serious review of financial policy should save millions. There is much scope for improvement. There are too many employees in the security sector and not enough in productive sectors.

Hamas will try to minimize expenditure and has already vowed to take lower salaries in high positions. All ministries can bear expense cuts.

And there are other ways of redirecting money. How many mosques are being built at the moment? In the Gaza Strip, each mosque needs at least $200,000. These mosques are built with money from private contributions and donations. If people have trust in their government, if Hamas can convince people that they will use their money with probity, this money can go to other projects.

Do people trust Hamas with their money? Recently, Hamas conducted a fund-raising campaign in the Gaza Strip and raised over $1 million there alone. The answer, it would appear, is yes.

In addition, there are promises of funding from non-western sources. Muslim and Arab governments have vowed to support the new Palestinian government. And while it may be true that some Arab governments are wary of Hamas and the ramifications of a successful Hamas-led government, there can be no doubt that the election of Hamas has proved widely popular among the peoples of the Muslim and Arab worlds, and all Muslim and Arab governments will be more wary of the feelings of their own people.

Still, should the West be adamant on cutting funding to the Palestinian Authority, it can seriously tighten the screw. But tightening the screw will ultimately lead to the collapse of the PA and that, Hamas believes, is not in the West's interests. It will harm the Palestinian people rather than Hamas.

Look at the evidence. People voted for Hamas in spite of it having been designated by the West as a terrorist organization. People voted for Hamas even though Fateh warned it would affect salaries. People voted for Hamas, because people trust Hamas and know Hamas. They did so in spite of all the threats. Should the PA collapse as a direct result of western pressure, there is no reason people will blame Hamas. On the contrary, people will blame the West.

From whatever sources, therefore, and whether directly or indirectly, Hamas is confident that funding will continue. We can see this already. The US says it will direct money through President Mahmoud Abbas. Hamas has no problem with this. Abu Mazen is the head of the PA and Hamas will not stand in his way, whether it is a matter of finance to help the Palestinian people or in his political pursuits.

Hamas is not opposed to negotiations in principle and will not stop Abbas from pursuing that path. After all, there is across-the-board Palestinian consensus on the major issues. Everyone will accept a Palestinian state on the 1967 borders with a just solution to the refugee problem. Abbas is thus free to pursue these aims in any way he sees fit.- Published 27/2/2006 © bitterlemons.org

Ghazi Hamad is editor-in-chief of Al Resala newspaper and was a parliamentary candidate for Hamas' Change and Reform list in the southern Gaza Strip city of Rafah.

To unsubscribe from this bitterlemons HTML email list, simply write to unsubscribehtml@bitterlemons.org with "unsubscribe" in the subject line. To subscribe to the text version instead, write to subscribetext@bitterlemons.org. Editors Ghassan Khatib and Yossi Alpher can be reached at ghassan@bitterlemons.org and yossi@bitterlemons.org, respectively.

Bitterlemons.org is an internet newsletter that presents Palestinian and Israeli viewpoints on prominent issues of concern. Each edition addresses a specific issue of controversy. Bitterlemons.org maintains complete organizational and institutional symmetry between its Palestinian and Israeli sides.