A Closer Look At The Distortion of Palestinian Aid Politics

On December 5, Karin Laub reported on the request by the PA for $5.8 billion in aid. Barry Rubin takes a look at how this was reported--and what is actually happening.

YOU OWE US BIGTIME: THE DISTORTION OF PALESTINIAN AID POLITICS

By Barry Rubin

My favorite sentence of the week is this one: “Asking for record $5.8 billion in aid through 2010, Palestinians promise fiscal reform.” Karen Laub wrote on this subject for the Associated Press, December 5, 2007, recounting how the Palestinian Authority (PA) asked the world to double the aid it receives.

What is funny about that opening sentence is that the PA has been given so much money before and squandered it. Promises of reform have been made and broken for more than 13 years. It is hard—but quite important--to remember the PA has existed that long with so little positive achievement. If Palestinians have such a bad economy it is not due to the “occupation” or to Israel but to their own leaders’ greed, incompetence, failure to end violence, inability to present an attractive investment climate, and unwillingness to impose stability on their own lands.

So how does an AP story deal with the unintentional humor of the idea that pouring more money into the PA will lead to any diplomatic progress or that this regime will make better use of the funds? Remember that to a very large extent the United States and European governments are basing their whole Middle East policy on this mistaken idea. Former British Prime Minister Tony Blair has turned this into a second career.

This is such an extremely important story that it is worth examining in detail.

According to the PA’s own plan:

“Seventy percent of the aid is to go for budget support, including $120 million a month to pay wages for the bloated public sector, and 30 percent is to be spent on development projects.”

The article at least uses the word “bloated.” Budget support is not development aid but simply pays the bill for those unable or unwilling to pay for themselves. But the article does not tell readers this nor that the public sector’s “bloated” nature is due to corruption, patronage for buying political support, and a hugely disproportionate military/police apparatus. Staying on a war footing with Israel is the main factor in the PA’s employment pattern. These security agencies are certainly not used to stop terrorism against Israelis and they certainly proved ineffective with Hamas. Individual police have often been involved in attacks. In large part, then, the aid would subsidize the Palestinian battle against Israel.

There is also another important point here not mentioned in the article. The PA collects fees but has never instituted a comprehensive tax system. It has acted as if it is the job of foreigners, which mostly means the West, to pay its bills. This is not psychologically healthy nor does it encourage politically responsible action. For the West’s part, economic leverage certainly has not been used to press the PA toward peace, much less nudge it toward fighting terrorism or ending incitement to anti-Israel violence.

The article, then, certainly does not blame the Palestinians’ economic problems on themselves. Instead, the responsibility for the problem is put mainly on Israel by letting PA officials make statements to that effect without contradiction or questions being raised.

Thus, Palestinian Planning Minister Samir Abdullah says he is aiming for a balanced budget within six years, the story continues—and this is not a direct quote from him—“perhaps even sooner if Israel moves quickly to lift crippling restrictions on trade and travel.”

How about these alternative phrases instead

--perhaps even sooner if the PA wages a war on corruption.
--perhaps even sooner if the PA tries to round up terrorists and elements that keep life unstable and extorts money from its own citizens on the guise of being patriotic organization.
--perhaps even sooner if the PA really makes compromises so as to reach a peace agreement with Israel.

And so on.

Instead, the article continues, “However, the Palestinians are submitting a steep aid request at a time of considerable `donor fatigue.’" But why are the donors getting tired of giving money.

According to Laub:

“Since the mid-1990s, the international community, led by Europe, has sent billions of dollars to the Palestinian territories to support peace efforts, but gains were largely wiped out in Israeli-Palestinian fighting. Critics also charge that large sums were siphoned off by corrupt officials in previous regimes.”

This is simply not honest. Do the donors say that they are happy to give money but “gains” were wiped out because of the fighting? No, they say: why should we give money when it is just stolen or misused. It isn’t just critics charging corruption, as if they are a few loudmouths talking off the top of their head. Could AP find anyone to deny this charge? How about writing:

Everybody says that corrupt officials have stolen a very high percentage of the aid.

Is this really a point that is controversial? One on which there are two sides?

In addition, gains—and there weren’t many gains—weren’t just wiped out in Israeli-Palestinian fighting as if some uncontrollable war broke out and swept over the countryside. The problem was that Yasir Arafat and his colleagues decided to launch a five-year-long war on Israel (whether or not Arafat planned it in advance or initiated it, he certainly kept it going and made it his strategy). That conflict, which brought absolutely no gain to the Palestinians, destroyed their infrastructure.

But the icing on the cake is the phrase “previous regimes” being responsible for corruption as if the current leadership has nothing to do with it. The current prime minister, a professional economist, may not be corrupt but the PA regime today is a continuation of all the ones before. Personnel have not changed very much. Who licensed AP to give a full pardon to all those PA officials who have been stealing for years and are still in office?

Basically, then, the rules of the game seem to be like this: Israel can be blamed but the Palestinians cannot be blamed. Nor are donors accorded common sense for refusing to throw their money down a pit which ultimately ends in the personal bank accounts of PA officials.

After all, the article claims:

“The international community's decision to impose sanctions after the militant Islamic group Hamas' parliamentary election victory in 2006 caused further economic decline, as money was shifted from development projects to welfare payments.”

Consider the ultimate mendacity of that statement. Of course, the sanctions caused further economic decline but guess what:

--The Palestinians elected Hamas knowing this was likely to happen. .
--If Hamas behaves in an extremist and terrorist way than it was not the international community’s decision to impose sanctions but rather Hamas’s decision to follow radical policies that caused further economic decline.
--It is a fantasy to think that the money used to go to “development projects” but now had to go to “welfare payments.” It always—and this includes budgetary subsidies—went for welfare payments.
--But here’s the worst point of all. The money was cut off before not after the Hamas victory. More than two months earlier the Europeans stopped aid because of PA corruption. It was the PA, not Hamas, which turned off the donors. This is a matter of public record.
--And finally, there is an interesting question that the article does not really explore. After all, why does the PA need twice as much money when it is governing only about half as many people as it was before? The Gaza Strip, after all, is under Hamas control.

The article does point out:

“It's not clear to what extent Gaza would benefit from foreign aid. The three-year plan only commits to providing humanitarian assistance and basic services until Gaza's borders reopen , presumably once Hamas is no longer in power there.

“Under the current arrangement, Abbas' government pays the salaries of 31,000 civil servants in Gaza who do not cooperate with Hamas, and covers Gaza's utility bills.”

Nevertheless, the article does not explicitly point out that the PA is basically asking for an increase in the already high—among the highest per capita foreign aid in history—aid donations by a factor of what amounts to 400 percent for the West Bank since the funds it was receiving in the past also subsidized all its expenses in the Gaza Strip as well.

The rest of the article is comprised of the PA’s fantasies, which it is allowed to present without contradiction, about its glorious three-year plan. Yet in this material Israel is blamed—again without any balance—for all the PA’s economic problems not once but three times:

"We are determined to bring an end to internal chaos and poverty, and the (Israeli) occupation that continues to aggravate this situation," the report said. "We are determined to reverse the impact of decades of conflict and 'de-development.'"

“Economic growth will be closely linked to a lifting of West Bank barriers and trade restrictions, the report said. Israel imposed the restrictions, starting in 2000, to try to prevent attacks by Palestinian militants.

"However, if the occupation regime remains at the status quo, the economic outlook is poor," the report said, adding that such a scenario would lead Abbas' government "to the point of institutional and fiscal collapse."

In short, Israel is blamed four times and Western donors twice in the article for the bad Palestinian economic situation. The Palestinian side is not attributed any responsibility whatsoever.

There are thus three problems with this article as with so much press coverage of Middle East issues:

--It is neither fair nor balanced.
--It increases readers’ misunderstanding rather than understanding of the issues.
--It sabotages attempts to fix problems since if the PA and Palestinians are divested of any responsibility they, and those trying to improve the situation, can hardly find solutions since no one focuses on what is really wrong.

Barry Rubin is director of the Global Research in International Affairs (GLORIA) Center and editor of the Middle East Review of International Affairs (MERIA) Center . His latest books are The Truth About Syria (Palgrave-Macmillan) and The Long War for Freedom: The Arab Struggle for Democracy in the Middle East (Wiley).

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