Will the US & Israel Save Hamas and Fatah Again?

A better system was the one both sides had before the U.S. intervened. Both were working on day-to-day security issues and employment. That is where SodaStream came from. The Israeli leadership figured that if the next generation of Palestinians had a stake in the system, they would negotiate more seriously. The Palestinian leadership figured that if people were eating, they would not overthrow the current government. It was working before the U.S. demanded an end to the conflict.

It's an old song, and they haven't even gotten to the chorus. Hamas and Fatah have not "reconciled." They appear to have come close to agreeing that they will hold talks to create a "unity government." After the government is created, there will be talks about elections, and only after that will there be talks about the distribution of portfolios under unified leadership. According to a Fatah spokesman, an interim government could be finalized in the next five weeks, with elections possible by early 2015.

This has been tried five times before. The failure of each attempt appears linked to the circumstance that the only principle they share is the belief that the establishment of Israel in 1948 was a mistake by the international community that needs rectification. In all other ways, they are rivals, not partners.

Ismail Haniyeh (center) speaks at the signing ceremony for the Hamas-Fatah unity agreement. (Image source: Screenshot of AlJazeera video)

But in a fit of wholly unwarranted optimism, let us say that this time Hamas (religious, kleptocratic, Iranian-supported, openly bloodthirsty) and Fatah (secular, kleptocratic, U.S. and EU-supported, and formally committed to diplomacy while stoking the flames of raw anti-Semitism in schools and Palestinian media) actually do figure out how to divide the spoils of the West Bank and Gaza.

That is when the problems begin.

U.S. demands of the Palestinians were, essentially two -- the requirement that the Palestinians explicitly accept Israel as a Jewish state is not new, it was a clarification of the original language of the 1947 UN Partition of Palestine into an "Arab State" and a "Jewish State." Mahmoud Abbas and Fatah were asked:

To concede sovereignty over their part of the larger Arab/Moslem patrimony to the Jews and -- perhaps more important -- to agree that Palestinian national aspirations would be forever satisfied with a split rump state squeezed in between a hostile Israel and an even more hostile Jordan; and

To concede that Palestinians who left the areas that became Israel in 1948 (and their descendants) would accept citizenship in the abovementioned rump state instead of having what they believe is their original property restored as promised by the Palestinian leadership. That the leadership had no authority to make such a promise is irrelevant to those who want to believe it, and to those who use it as "code" for destroying Israel.

Abbas could agree to neither -- and what he could not do, Hamas certainly cannot do. So either Abbas moves Fatah closer to Hamas and abandons its American and European political and financial backers, or Hamas moves closer to Fatah, abandoning its Charter and its Iranian allies. Considering that each side has an army (Fatah's is U.S. trained; Hamas's is Iranian trained) and that there has been no discussion about who will be responsible for security either in the West Bank or Gaza under a "unity government," a repeat of the 2007 short and brutal Palestinian civil war is a distinct possibility. "Peace" is not a distinct possibility.

The United States and the Europeans claim to be unhappy with the new state of affairs, but the proposal by Rep. Ros-Lehtinen (R-FL) and Rep. Ted Deutsch (D-FL) to cut off aid under the Palestinian Terrorism Act was not well-received by the State Department. Secretary of State Kerry said Israeli and Palestinian leaders needed to be willing to make compromises to keep the negotiations alive -- as if it was Israel that had joined forces with a U.S.-designated terrorist organization. Spokesman Jen Psaki said, "Well, obviously, there would be implications. I don't have those all in front of me ... but what we're going to watch and see here is what happens over the coming hours and days to see what steps are taken by the Palestinians."

And watch what they do with their money.

The total Palestinian Authority [PA] budget for 2014 is planned to be $4.3 billion with a deficit of $1.2 billion. Income from taxes and other fees is estimated at $2.7 billion and another $1.6 billion will come in the form of foreign aid. That would be an expectation of almost 33% of the budget coming in the form of aid, and a deficit planned to be 28% of spending. (The U.S. budget deficit, by comparison was 8.7% of GDP in 2011, and it has fallen with the effects of sequestration and other decisions.)

Where does it come from and where does it go?

In January, the Administration announced that, linked to the "peace process," American aid to the PA -- not including security assistance of approximately $100 million annually -- would be increased from $426 million in 2013 to $440 million in 2014. The Europeans, the largest financial backers of the Palestinian Authority, have provided more than $7 billion since 1994. Interestingly, although all other EU aid is tied both to the human rights record and transparency of the recipient, the PA faces no such restraints.

Nearly half of the budget will pay salaries -- a 4.9% increase over last year (this may come as a surprise to European government employees who are still in the throes of austerity budgeting). In addition, according to EU auditors in December, the EU is paying salaries for approximately 61,000 civil servants and members of the security forces who stopped reporting for work after the 2007 civil war. In one office, they found 90 out of the 125 staff members absent.

According to The Wall Street Journal, the PA allocates a significant portion of its budget to salaries for Palestinians convicted of terrorism by Israel. These salaries are up to five times higher than the average salary in the West Bank. According to Israel's Ministry of Foreign Affairs, in 2012 the PA's payments to convicted terrorists in Israeli prisons and to the families of deceased terrorists (including suicide bombers) together accounted for more than 16% of the annual foreign donations and grants to the budget of the Palestinian Authority. The Palestinian minister for prisoners' affairs announced that [approximately $41 million] would be allocated to current or former prisoners in 2014.

It other words, the Palestinians use an astonishing amount of foreign money to bribe and coerce the potentially recalcitrant.

Despite Palestinian corruption, abuse and support for terrorism, Israel has been unwilling to see Palestinian institutions collapse. While the Palestinians are nominally responsible for social services, Israel has ensured that there is no widespread hunger, disease, or power outages. The examples are legion – at the height of the so-called "second intifada," when Palestinians were blowing up buses in the middle of cities and shooting civilians, Israel continued to coordinate food aid through a variety of NGOs. In 2012, to help the PA solve its financial crisis, Israel sought $1 billion in loans from the International Monetary Fund, intending to transfer the money to the PA. The IMF rejected the proposal because it feared setting a precedent of making IMF money available to non-state entities even through a state sponsor. Israel has also taken up much of the slack in supporting Hamas with gasoline and electricity since Egypt has been bombing and closing the Sinai tunnels. Israeli medical care has always been available to Palestinians.

Israel evidently believes a) it has a humanitarian obligation regarding Palestinian civilians; b) that should the institutions collapse, so will foreign aid to the Palestinians, leaving Israel with the entire bill for Palestinian social services; and c) at some point, there should be peace with the Palestinians, who will need a capable government to ensure the terms of whatever agreement is reached.

The announcement of "reconciliation" may actually be an attempt to form a united front. Or more likely, it could be a mechanism for Abbas to end negotiations that cannot succeed. If that is so, it could serve as a great clarifying moment in which Israel comes to see that perpetuating the fraud of a competent Palestinian government is more of a losing proposition for Israel than for its adversaries. Perpetuating the fraud of a competent Palestinian government carries no chance of a negotiated peace. There will always be a John Kerry who says the Israelis have to do more, therefore Israel will always be subject to the disapproval of those who expect Israel alone to fix the problem.

A better system was the one that both sides had before the U.S. Administration intervened with its pipe-dreams. Both were working on day-to-day security issues and employment. That is where SodaStream came from. The Israeli leadership figured that if the next generation of Palestinians had a stake in the system, they would negotiate more seriously. The Palestinian leadership figured that if people were eating, they would not overthrow the current government. It was working until the U.S. demanded an end to the conflict.