Updates

Update from AIJAC

January 7, 2011
Number 01/11 #01

This first Update of 2011 contains two new pieces on the always troublesome situation in Gaza, especially in the wake of escalating violence sparked by rocket fire into Israel from there in late December.

First up is a piece by leading Israeli journalist Ehud Yaari and Eyal Ofer, an expert on the Palestinian economy, on the economy of Gaza and how Hamas has been financing its rule there. Yaari and Ofer look at the size of Hamas’ budget, the sources of funding into Gaza, and Hamas’ success in placing its regime on a sound financial basis both through internal taxes and fees and its exploitation of foreign aid. The information in this article is fairly unique, available from no other public sources, and is thus highly important to anyone who wants to understand the realities of the Gaza situation. For all the details, CLICK HERE.

Next up, military expert Jeffrey White looks at the strategic realities behind the Israeli-Hamas clashes that occurred in late December, following increased rocket fire and border clashes. While the episode of intensified violence seems to have ended for the time being, White identifies a significant danger of an escalatory spiral resulting in a major clash that neither side currently seeks. Moreover, he points out that Israel’s deterrence against Hamas attack is inevitably eroding, and indeed, the situation is not one suitable to a stable deterrence, and predicts that its likely that another major IDF military action in Gaza will prove necessary at some stage. For the rest of White’s detailed analysis, CLICK HERE. Meanwhile, Israeli analyst Jonathan D. Halevi looks at recent statement by Hamas leaders, debunking those who insist Hamas has moderated and now should now be negotiated with.

Finally, veteran Washington insider Steve Rosen looks at what appears to be a glaring omission in American Middle East policy, the lack of any significant pressure, even verbal pressure, on the Palestinian side to resume direct negotiations. Rosen points out that not only are the Palestinian refusing to negotiate for the first time after negotiating with the previous seven Israeli Prime Ministers, they are also acting in contradiction to the Quartet roadmap, prevous commitments made as part of Oslo , as well as the US Administration’s declared opposition to preconditions on talks. Rosen raises the prospects that the Republican-controlled US Congress may start to raise the issue of such pressure to resume negotiations in coming months. For his complete argument, CLICK HERE. Rosen made a similar but somewhat expanded argument focussing on US policy at the UN Security Council recently here.  Additional interesting analyses of Obama Administration Middle East Policy after two years in office are here and here.

Readers may also be interested in:

• Wikileaks documents include some new revelations about what Israeli hoped to accomplish with its Gaza blockade, but Barry Rubin argues that the revelations are actually exactly what you would expect. However, Wikileaks also revealed allegations of corruption against IDF solders controlling the Gaza border. 
• Rubin also recently took on the controversy over the death of Palestinian woman Jawaher Abu Rahma, claimed to have died as the result of tear gas inhalation, something strongly disputed by Israeli government sources.
• Veteran Australian Jewish leader Isi Liebler has some interesting comments on the issue of corruption in Israel in the wake or the conviction of former Israeli President Moshe Katsav on rape charges.
• Israeli PM Netanyahu clarifies that – contrary to was widely reported in the press – Israel was ready to agree to a second moratorium on construction in settlements and its was the US who pulled the plug last month. American journalist Gary Rosenblatt says his sources in the administration in Washington confirm that this is in fact correct.
• Some analysis of the potential conflicts which could be sparked by the discovery of large gas fields off the Israeli coast –  here and here. 
• Israeli deputy Foreign Minister Danny Ayalon explains a controversial new bill before the Knesset to investigate the sources of funding of some anti-Israel NGOs.
  
• Israeli NGO head Benny Levy offers a creative model for Israeli-Palestinian peace while getting around the Palestinian refusal to renounce certain “sanctified values” which appear to make peace impossible.
• The worrying situation in Pakistan in the wake of the murder of Punjab governor Salman Taseer, and the praise being showered on his killer from many quarters. 

Gaza’s Economy: How Hamas Stays in Power 

By Ehud Yaari and Eyal Ofer

PolicyWatch #1737
January 6, 2011

Since Israel’s August 2005 withdrawal from the Gaza Strip, Hamas has evolved from a relatively small movement into a well-funded conglomerate. Instead of being crippled by sanctions and siege, the organization has found ways to surmount early difficulties — such as frequent payroll delays — and establish an effective system of governance, ever tightening its grip over its fiefdom. As a result, Hamas has been able to empower loyalists while leaving the main burden of responsibility for Gaza’s 1.6 million residents to others. Unfortunately, both the Ramallah-based Palestinian Authority (PA) and international donors have tolerated this situation, effectively contributing, if indirectly, to Hamas coffers.

Gaza’s Economy
Reliable data regarding Gaza’s finances is very difficult to obtain. Hamas has tight lips, the Israel Defense Forces (IDF) release little information, and international agencies such as the International Monetary Fund (IMF) and World Bank generally aggregate Gaza and the West Bank when presenting statistics. Much of the information in this article is derived from Palestinian news reports and interviews with informed sources in Gaza; accordingly, most of the figures below should be treated as rough approximations.

The IMF estimated Gaza’s 2009 gross domestic product (GDP) growth at 12 percent, an impressive number. According to a September 2010 IMF report, the total Gazan and West Bank GDP was $7 billion, while the gap in per capita income between the two areas was 48 percent; this data, combined with other relevant statistics, implies that Gaza’s per capita GDP was around $1,400, much of which derives from payments by the PA. Transfers and remittances added 50 percent more income, implying that average total per capita income was, in fact, $2,100. Yet much of this income does not represent productive economic activities, and unemployment remains high — probably around a third of the workforce.

One must also take into account the considerable trade conducted via the more than 800 tunnels into Egypt. Based on fragmentary evidence, this trade likely peaked at around $600-850 million per year. Much attention has already been devoted to the goods smuggled into Gaza, such as fuel and cement. Less well understood is the fact that, in exchange for these goods, cash has been steadily exported out of Gaza through the tunnels, at a rate of roughly $750 million per year. Cash is also flowing out of Gaza — through the tunnels and via bank transfers — to safe havens in Persian Gulf countries and Europe. The new wealthy class — many associated with Hamas — as well as established capital owners are concerned about keeping their money inside Gaza, preferring to move it abroad. And even with huge sums flowing out of the territory, there is still more cash than opportunities to invest it. In February 2009, for example, Gaza banks actually turned to Israel’s Central Bank with an odd request: to deposit excess cash reserves in Israel.

Where does all this cash come from? Many assume that substantial sums have been entering Gaza via the tunnels since 2008, but this can be only partially confirmed. Instead, the cash inflow seems to come primarily through banks. According to Palestinian banking officials, an average of $2 billion per year has been transferred into Gaza via the Palestinian banking system since Hamas’s June 2007 military takeover. The PA alone wires an estimated $1.2 billion per year into Gaza banks, much of it as pensions and salaries for the 77,000 employees kept on the payroll even though they are not working. In fact, this estimate may be conservative; according to PA prime minister Salam Fayad, 54 percent of the PA’s $3.17 billion 2010 budget went to Gaza. Most of that figure appears to be salaries, although it also covers what the PA pays directly for electricity, fuel, and water provided to Gaza by Israeli firms.

In addition, the UN Relief and Works Agency annually transfers about $200 million in cash to Gaza, along with $250 million per year worth of goods, grains, and fuel. Cash is also transferred into Gaza by the 160 nongovernmental organizations operating there, by international organizations such as the World Bank, and by foreign government aid organizations, although much of what they spend arrives in the form of goods shipped via Israel.

Hamas Resources
Hamas officials consistently refuse to disclose budgetary details or any other information regarding their sources of income. One official, Jamal Nasser, claimed that the group derives only $60 million per year from fees and taxes, with the rest coming from gifts and foreign aid. That does not appear to be the case, however. According to Israeli military intelligence, Iranian subsidies to Hamas total around $100 million annually, or less than 20 percent of the group’s proclaimed budget, stated to be $540 million in 2010. Iranian funds are directed mostly toward the Hamas Political Bureau in Damascus, primarily for weapons purchases and shipments, rather than toward Gaza. PA president Mahmoud Abbas has offered a much higher estimate, claiming that Iranian aid is approximately $250-500 million, but little evidence supports his figure.

Hamas likely raises as much as $250 million annually via taxes. The group has imposed all sorts of new fees and taxes, such as charging three Israeli new shekels (NIS) on every pack of cigarettes (which may generate around $80 million annually) and an NIS 1,400 auto registration fee (which may generate an additional $25 million based on estimates of 60,000 registered cars in Gaza). Hamas also regulates many types of businesses — from street vendors to Gaza’s twenty money-changing companies — requiring them to pay license fees. In addition, taxes are collected on “luxury” goods coming from Israel, and even on motorcycles and carts.

Hamas also takes a hefty cut from the Egyptian tunnel trade, imposing high “customs” duties and a daily fee on local tunnel contractors. Such trade has been dramatically reduced since June 2010, when Israel quadrupled the number of trucks permitted to bring goods to Gaza through legal terminals. To replace lost tunnel income, Hamas is reportedly taking advantage of the relative drop in prices on goods arriving via official Israeli channels, imposing new taxes on various items. For example, from early July to September 20, 2010, the group barred the importation of new cars from Israel until the taxation issues were resolved.

Hamas is also exploiting its control over various Gaza resources, such as leasing government-owned heavy machinery to private contractors for a daily fee. This is one of many ways the group has been able to indirectly benefit from the international reconstruction funds flowing into Gaza.

Hamas Expenditures
In 2005, Hamas was a modestly sized organization of 4,000-7,000 military personnel, with a small charity and education network and a skeletal party bureaucracy. From 2006 to 2010, however, the funds at the group’s disposal reportedly grew from $40 million to $540 million. At the same time, Hamas has gained full control over all government ministries and municipal councils in Gaza, as well as many civilian agencies. It also holds a monopoly of power over every security and intelligence service in the territory, such as the 10,000-strong “blue” police. In total, Hamas pays salaries to at least 35,000 employees, among them many of the 20,000-plus armed personnel. Given this apparent payroll and an estimated average monthly salary of NIS 1,500 ($425), the group may be spending — according to Prime Minister Ismail Haniyah — as much as $300 million per year on salaries, a sum greater than the entire PA payroll. Hamas also claims that it allocates $30 million annually to its activities in the West Bank, without disclosing the methods by which funds arrive there.

To help curb illicit financing, the United States has designated the Hamas Islamic National Bank and the Gaza Postal Bank as “terrorist entities,” but it is not clear how much this measure has affected their operations. Both banks continue to conduct business in NIS, and they seem to have developed ways of working with moneychangers used by individuals who receive their salaries in U.S. dollars. The Islamic National Bank even has sufficient liquidity at present to offer home mortgages.

This state of play demonstrates Hamas’s major success in overcoming the system of blockade, boycott, and denial of recognition and assistance imposed by Israel, the PA, most Arab countries (especially Egypt), and the West. In addition to its own direct spending, Hamas has been able to tap into financial resources transferred by the PA and aid agencies, ensuring payments to supporters who have replaced Fatah loyalists in government jobs. Lists used by donors to screen for terrorists include very few Hamas operatives; even if this problem were addressed, the screening of PA employees is largely done by Hamas sympathizers. In total, thousands of Hamas members, including many military personnel with fake civilian positions, are paid by outside donors.

The movement has also recently turned to purchasing all sorts of businesses and initiating new ventures, such as the Islamic Bank, the al-Multazim insurance firm, housing projects, hotels, a shopping mall, resorts, agricultural farms, and a fish hatchery. In fact, Hamas’s economic mini-empire is fast becoming the main player in Gaza’s private sector. The group often forces businesses to close down in order to eliminate competition. It also coerces owners into selling items for cheap or “contributing” to Hamas either in cash or in kind (e.g., building materials). Frequently, new Hamas businesses are registered under the names of straw owners or individuals from Hamas cadres. The group has also taken over all the land belonging to the former Israeli settlement of Gush Katif, along with parts of the Gaza beachfront.

Conclusion
Soon after its 2006 electoral victory in Gaza, Hamas faced great financial difficulties, leading the group to smuggle millions of dollars in cash through Egypt. Today, however, Hamas has managed to develop local sources of steadily growing income, mainly by exploiting the huge aid sums transferred by the PA and international donors to sustain the general population. No effective mechanism is in place to prevent the group from taking advantage of the constant cash flow into Gaza; as a result, a significant part of the money intended to help alleviate the hardship of the region’s inhabitants has gone to waste. More rigorous measures are needed to restrict Hamas’s ability to siphon off such funding for its own purposes.

Ehud Yaari is an Israel-based Lafer international fellow with The Washington Institute. Eyal Ofer is a researcher specializing in the Palestinian economy.

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Tension with Gaza: Israel’s Deterrence under Pressure

By Jeffrey White

PolicyWatch #1735
January 4, 2011

In December 2010, violence increased significantly along Israel’s border with Gaza, manifest by high-trajectory fire (rockets and mortars) on southern Israel, counterstrikes by the Israel Defense Forces (IDF), and clashes along the border security fence. The Gaza situation since the end of Israel’s Operation Cast Lead in January 2009 has been characterized by similar periods of increased violence and tension. Although these episodes have not produced major hostilities, the deterrence established by Cast Lead is decaying over time. Neither Hamas nor Israel may be seeking another round of serious fighting, but the potential for such fighting has nonetheless grown.

Military and Political Dynamics
Periods of increased tensions related to Gaza are not a new phenomenon (see PolicyWatch #1648), and last month’s case was serious. Overall, the situation is driven by both military and political processes that could propel the violence to higher levels.

On the military side, rocket and mortar fire from within Gaza elicits retaliatory strikes from the Israelis at various levels of intensity. The mid-December attacks, for their part, prompted a series of Israeli Air Force (IAF) actions on December 21 against multiple targets within Gaza — the most intense such actions since Cast Lead. As a rule, Israeli counterstrikes lead to additional attacks by terrorist elements from within Gaza, and actions by both sides tend to be more serious when casualties have been incurred. For example, when five Palestinian terrorists w3ere killed by the IAF on December 19 as they prepared to launch rockets into Israel, the Palestinians responded with rocket and mortar strikes into southern Israel. This attack/retaliatory-attack dynamic, and the effects of specific incidents, can result in escalation.

A second military challenge relating to Gaza involves the struggle for dominance of the border zone, a situation that also intensified in December. The general picture entails Palestinian groups, including Hamas, attempting to advance their activity to the fence, while Israel seeks to control an area up to several hundred meters inside the Gaza Strip to prevent the approach of terrorist elements to the border. This contest produces incidents and casualties, usually Palestinian, on a regular basis.

Various weapons and tactics are employed by Palestinians in the border struggle, including antitank weapons, improvised explosive devices, mortars, small arms, and sniper fire. According to the IDF, terrorists sometimes use civilian activity in or near the border zone as cover for armed elements to approach the security fence; Palestinian civilians are sometimes killed and wounded as a result. The tools used by Israel, meanwhile, include infantry and armored quick-reaction forces, heavy machine guns, tanks, drones, attack helicopters, and aircraft. The combination of armed Palestinians attempting to operate in the security zone and a high degree of readiness by the IDF to prevent such activity generates the clashes. The IDF rotates personnel from its best infantry and armored brigades for duty along the Gaza border, and these units are primarily involved in the ground clashes.

A third military component of the Gaza border conflict involves the increasing capabilities of the Palestinian terrorist groups, as evidenced in large part by their acquisition of new and more weapons. Since Cast Lead, terrorist groups have obtained long-range rockets including the Iranian-designed Fajr-5 (with a range of 70 km), as well as large numbers of shorter-range rockets. On December 6, 2010, an AT-5 Kornet antitank guided missile was employed by Palestinians for the first time in the Gaza conflict. The missile hit and penetrated the armor of an Israeli Merkava tank. Terrorists in Gaza are also reportedly receiving antiaircraft weapons, including man-portable surface-to-air missiles (SAMs). Several shipments of SAMs bound for Gaza have reportedly been discovered by the Egyptians in the Sinai. These new weapons may be boosting the confidence of armed elements in Gaza, and the repetitive nature of Israeli counteroperations may be hardening them to routine IDF action. On the whole, enhanced capabilities raise the stakes in military actions. Longer-range rockets and more rockets mean a greater proportion of Israelis at risk, and Kornet missiles increase the danger to IDF forces operating along the border. The consequences may apply not only to tanks and other armored vehicles but also to fixed positions and potentially to civilian transportation, agricultural activity, and settlements within five kilometers of the border.

Political dynamics on both sides could also undermine deterrence. For Hamas, processes between the military and political wings and so-called hardliners and moderates play out in often opaque ways. The movement must accommodate pressures for military action from within, and the results of such pressures can influence power dynamics within the group. Hamas must also deal with other Gaza terrorist organizations, including more or less like-minded groups such as the Palestinian Resistance Committees and Islamic Jihad and dissenters such as Jaish al-Islam. And Hamas must consider its position vis-a-vis the Palestinian Authority (PA). On a fundamental level, Hamas uses its claim as a “resistance” movement intent on liberating all the Occupied Territories to distinguish itself from the PA. A failure to demonstrate active resistance weakens its claim to be a meaningful alternative. For its part, the Israeli government also faces political pressure to act in the face of attacks from Gaza. Residents of the south feel threatened, and their political representatives advocate taking strong action in response.

Challenges for Hamas and Israel
Hamas and Israel face challenges in maintaining stability both in the current situation and for the future. The IDF assesses that Hamas currently wants to concentrate on internal matters in Gaza and building its political and military strength rather than becoming involved in open warfare with Israel — and Hamas seems to be acting in line with such an assessment. Yet the multiplicity of armed actors within Gaza and their complex relationships with Hamas make this process difficult to undertake with complete assurance. Hamas appears to be responding to the challenge by suppressing some rocket and mortar fire, while permitting various groups to carry out actions along the security fence. Hamas has also been engaged in the rhetoric of resistance. The Izz al-Din al-Qassam Brigades, the military wing of Hamas, has been celebrating the concurrent twenty-third anniversary of the founding of the movement and the second anniversary of the Battle of the Criterion (Hamas’s name for the 2008-2009 conflict with Israel) with numerous statements, displays, and publications celebrating its past accomplishments and signaling readiness for renewed battle.

Israel has its own challenges. It must preserve relative quiet in the south for the Israeli population, minimize Israeli civilian and military casualties, dominate the border zone, and control escalation when incidents occur. Enhanced defensive measures can help in these endeavors. Reportedly, Israel deployed the Raz counterrocket radar system to the Gaza area during the latest escalation, will utilize Merkava IV tanks with active protection systems along the border, and is implementing other counterinfiltration and defensive measures. Israeli air and ground units operating near Gaza will also modify tactics in accordance with the threat from antiaircraft and antitank systems in order to reduce exposure and risk. Nevertheless, the primary means of preventing attacks is through maintenance and periodic reinforcement of deterrence by applying threats and limited and controlled military power. This is a continuous and demanding process in a highly dynamic environment. Effective deterrence is not achieved at once, or forever, or without risk of escalation.

Conclusions
Over time, deterrence in the Gaza situation will likely fail. Deterrence works best in essentially stable situations, wherein the sides clearly understand each other’s calculus. Gaza is highly dynamic, with many actors with different motivations and numerous connections and linkages. Hamas cannot, or will not, control all the high-trajectory fire from Gaza or all the incidents along the border fence, and such a reality will keep alive the chances of a serious incident that produces escalation.

The military capabilities of the Qassam Brigades and other organizations have increased, perhaps making them more confident as well as more dangerous. This may lead to sharper fighting along the buffer zone — and inevitably to more casualties, including IDF — along with increased pressure on the IDF to respond with greater force.

Retaliatory bombing by the IDF does not seem to have a lasting effect, as the targets (tunnels, arms manufacturing and storage facilities, and other installations and activities) are not critical. The Qassam Brigades and others are used to being bombed, and maintaining deterrence will require stronger measures. Enforcing a kind of comprehensive deterrence is likely to be an upward — or downward — spiral for the IDF. Such enforcement requires holding Hamas accountable for all violent incidents from Gaza, an approach that is problematic given the dynamics of the situation and echoes past IDF efforts to “find the address” for border infiltration and terrorism.

A spiral of violence would most likely have the following features: an increase in rocket and mortar fire over time with a mounting response by the IDF, more serious and more numerous clashes in the buffer zone and along the fence, increased military and civilian casualties on both sides, and perhaps a change in the character of incidents, which could include serious Palestinian attempts to penetrate the border and kidnapping operations, and IDF strikes against leadership targets in Gaza.

Keeping the situation stable under such escalated circumstances will be very difficult, even if Hamas and Israel wish to avoid a major conflict. This latest flare-up may have ended, but sometime ahead a major IDF operation to address the threat seems likely.

Jeffrey White is a defense fellow at The Washington Institute, specializing in the military and security affairs of the Levant and Iran.

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Why Isn’t Obama Pressuring the Palestinians?

by Steven J. Rosen

Foreign Policy, January 4, 2011

For the first time since the Oslo peace process started 18 years ago, Palestinian leaders are openly refusing to negotiate with the government of Israel, and U.S. President Barack Obama’s administration is doing very little about it. As Mahmoud Abbas, the Palestinian Authority president, explained the policy on Dec. 9, “We will not agree to negotiate as long as settlement building continues.” The Arab League is backing Abbas in this refusal, says League chief Amr Moussa, because “the direction of talks has become ineffective and it has decided against the resumption of negotiations.”

But Abbas himself negotiated with seven previous Israeli prime ministers without such preconditions. For 17 years — from the Madrid conference of October 1991 through Abbas’s negotiations with then Israeli Prime Minister Ehud Olmert, which ended in 2008 — negotiations moved forward while Jerusalem construction continued. Madrid, Oslo I, Oslo II, the Hebron Protocol, the Wye River Memorandum, Camp David, Taba, the disengagement from Gaza, and Olmert’s offer to Abbas — all these events over the course of two decades were made possible by a continuing agreement to disagree about Israeli construction of Jewish homes in Jewish neighborhoods outside the pre-1967 line in East Jerusalem. But now, peace talks cannot even begin. Why the change?

U.S. Secretary of State Hillary Clinton acknowledges that the Palestinians are creating a new precondition for talks to begin. Settlements, she says, have “always been an issue within the negotiations.… There’s never been a precondition.” But Clinton has not stated any public objection to Abbas making this a new excuse not to negotiate.

Abbas himself blames Obama. As he said in November, “At first, President Obama stated in Cairo that Israel must stop all construction activities in the settlements. Could we demand less than that?” Some in the West are sympathetic to Abbas’s maneuver, which they see as a form of protest against an Israeli policy to which the United States and the rest of the Middle East quartet, the four international players that steer peace efforts, also object. But when the Palestinians spurn negotiations, they are blocking the sole path to a solution of the settlement issue, which can only be a negotiated agreement over borders. As the State Department spokesman’s said on Aug. 2, “Absent a direct negotiation, there will be no end to the conflict, there will be no peace agreement, and there will be no Palestinian state. That’s a fact.”

There is also the question of whether Abbas’s motive here is actually about the settlement issue, or rather to drive a wedge between Obama and Israel and induce the United States to impose a solution in lieu of negotiations. Isn’t this a reversion to the pre-Oslo strategy of rejecting contact with Israel and demanding instead that the great powers impose Arab terms on the Jewish state?

In refusing to meet with Israel, Abbas is violating one of the most important commitments his predecessor Yasir Arafat made at the start of the Oslo process, which included this pledge to then Prime Minister Yitzhak Rabin on Sept. 9, 1993: “The PLO commits itself to the Middle East peace process, and to a peaceful resolution of the conflict between the two sides, and declares that all outstanding issues relating to permanent status will be resolved through negotiations.” It is also a direct violation of the pledge that Abbas himself made barely three years ago at the Annapolis conference. As witnessed by foreign ministers of 47 countries on Nov. 27, 2007: “We agree to immediately launch good-faith bilateral negotiations in order to conclude a peace treaty, resolving all outstanding issues, including all core issues without exception, as specified in previous agreements. We agree to engage in vigorous, ongoing and continuous negotiations.”

Abbas is also rejecting the imperative laid down by the Middle East “Quartet” in March 2010, demanding “the resumption, without preconditions, of direct, bilateral negotiations that resolve all final status issues as previously agreed by the parties.” It is a repudiation of Obama’s Middle East envoy George Mitchell, who said, “We do not believe in preconditions. We do not impose them. And we urge others not to impose preconditions.” It is a dismissal of an objective considered vital by the Obama administration, to “re-launch negotiations as soon as possible and without preconditions, which is in the interests of everyone in the region.” Abbas is spurning all appeals from Clinton, who says that “negotiations between the parties is the only means by which all of the outstanding claims arising out of the conflict can be resolved.”

But the Obama administration is raising no public objection to the Palestinians’ stance. It has not expressed one word of criticism of Abbas, nor used anything resembling the pressure tactics Obama has so freely used against the Israeli side. In fact, Obama did quite the opposite on Oct. 7, when he issued a special waiver of Section 7040(a) of the Foreign Assistance Act to transfer additional funds directly to the Palestinian Authority, just as it was announcing its refusal to negotiate.

Members of Congress are starting to take notice of the administration’s reticence to confront Palestinian intransigence. Ileana Ros-Lehtinen (R-FL), the incoming House Foreign Affairs Committee chairwoman, said on Dec. 23 of Palestinian leaders: “They know they don’t have to do a darn thing; with this administration they will get a blank check, and they will always get helped out.… Try examining where they’re using their money and where our U.S. dollars are going.” Her Democratic counterpart, California’s Howard Berman, the outgoing chairman of the committee, said a few days earlier, referring to Abbas’s unilateral drive to seek early recognition of Palestinian statehood, “If they try to circumvent negotiations, they’ll lose the support of a lot of people like me, and it will jeopardize their foreign aid as well.”

As it happens, a statute is already in place, requiring sanctions against such violations of the solemn commitments the Palestinians made. The Middle East Peace Commitments Act of 2002 notes that “Resolution of all outstanding issues in the conflict between the two sides through negotiations” is one of the core commitments to which the Palestinian Authority has obligated itself, and it requires the president to notify Congress of such violations and impose penalties, which may include a “prohibition on United States assistance to the West Bank and Gaza.” When it returns to Washington this month, the new Congress may not share Obama’s reluctance to criticize Abbas. With the support of Speaker John Boehner and Majority Leader Eric Cantor, the new House in particular may be willing to do something about it.

Steven J. Rosen served for 23 years as foreign policy director of the American Israel Public Affairs Committee. He is now director of the Washington Project at the Middle East Forum.

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