Palestine: A Change of Direction
Battered by Sharon, ignored by Bush and discouraged by a failed four-year uprising, the Palestinians are finally taking a hard look at themselves

Alex Majoli / Magnum for Newsweek
Khreisheh: Pressure is building against Arafat 
By Joshua Hammer
Newsweek InternationalAug. 30 issue - Hasan Khreisheh doesn't look like a revolutionary. A heavyset figure with a thick mustache and teeth stained from a regular intake of Craven cigarettes, he could easily pass for one of the political bosses who have flourished inside the smoke-filled backrooms of Yasir Arafat's Palestinian Authority. But Khreisheh, a tough-minded independent in the Palestinian Legislative Council, is engaged in an unprecedented and dangerous crusade to root out and punish corruption. For months Khreisheh, the deputy speaker and head of a PLC investigative committee, has probed the activities of seven leading Palestinian businessmen and the Palestinian minister of the Economy, Maher al Masri, who, he charges, were complicit in a scheme to defraud the government and undermine the Palestinian people. The businessmen received licenses from the ministry to import thousands of tons of cheap cement from Egypt. According to Khreisheh, they illicitly diverted most of the cement to an Israeli construction firm in Haifa, making a $5.5 million tax-free profit in the process. The diverted cement was then used to build Israel's 724km-long security barrier—a hated project condemned by Palestinians as a land grab. "We have been telling our people, 'Fight against the wall'," says Khreisheh. "Some of our rich men were taking blood money to build it." (Masri claims the quantity of cement reported was exaggerated in an attempt to smear his reputation.)

Khreisheh's campaign has made him many enemies. His life has been threatened. Opponents have accused him of being a paid agent of the U.S. and Israeli governments. He moves around his hometown of Tulkarm, in the northern West Bank, surrounded by bodyguards. In July his longtime PLC colleague Nabil Amr, a former cabinet minister who often complained about corruption and inefficiency in Arafat's administration, was shot in the leg by unknown assailants as he walked home in Ramallah; the limb was later amputated. The attack horrified Khreisheh, but didn't deter him. His latest crusade: pressing for the removal of Amin Haddad, governor of the Palestinian Monetary Authority, who is accused of profiting illegally from his management of the Palestine International Bank. Haddad has denied any wrongdoing. The PLC asked for Haddad's resignation, but Arafat continues to back him. "Arafat resists any change, but pressure is building against him," Khreisheh says.

Indeed it is. After four years of an armed uprising that is now widely regarded as a catastrophic failure, Palestinian society and legislators are rising up in an open revolt against the leadership—including their once unassailable chairman. Grumblings about corruption, mismanagement and lawlessness in the Palestinian Authority have been heard often in the past. What's different now is the volume of the criticism, the proliferation of the critics and the momentum for fundamental change. Dennis Ross, a key negotiator for President Bill Clinton during the 2000 Camp David peace talks that ended in failure, said last week that Palestinian leaders from within Arafat's own Fatah movement were serious, for the first time, about building a "positive political framework" (see the last word). He added that there was an emerging consensus among the Palestinians, trigged by Israeli Prime Minister Ariel Sharon's desire to withdraw from Gaza, that they must "create a civil society based on the rule of law." Said Ross: "This is a remarkable development."

The reform campaign has been gaining momentum. Many Fatah members now acknowledge that Arafat's rule has been a disaster. In one of its sternest rebukes ever, a Palestinian Legislative Council investigation two weeks ago blamed the Palestinian leader and his associates for "anarchy" and for "failing to take a political decision to end it." Put together by a five-man panel—including both Fatah reformers and Arafat loyalists—the report demanded an end to Qassam rocket fire into Israel and other attacks, and the resignation of the members of Prime Minister Ahmed Qurei's government, and called for general elections. The panel lambasted the government for its paralysis in dealing with the armed militants who have held the West Bank and Gaza hostage for four years. "The main reason for the failure of the Palestinian security forces, and their lack of action in restoring law and order," says the report, "is the total lack of a clear political decision and no definition of their roles."

Arafat appears to be getting the message. In a speech last week from his compound in Ramallah, he engaged in belated damage control, offering a tentative mea culpa for the chaos that has beset Palestinian society. "We have to be brave enough to admit making mistakes," Arafat said. He also promised to give full backing to Qurei, also known as Abu Ala, who has squabbled with Arafat often and in July tendered his resignation in frustration over Arafat's resistance to key reforms. (He withdrew his resignation on July 27 after Arafat agreed to turn over internal security powers.) Reaction to Arafat's speech was mixed. "This is the first time I heard President Arafat say the sentence that many Palestinian officials have abused their post," says Saeb Erakat, the Palestinians' chief negotiator. But others were skeptical. "We are waiting to see action," says Mohammed Hourani, a critic of Arafat's and a leader of the Fatah reformers in the Palestinian Legislative Council.

Palestinians have seen efforts at reform sputter out before. In March 2003, international pressure on Arafat to clean up his government and embrace the peace plan known as the Roadmap forced him to create the post of prime minister and surrender power over some cabinet appointments. But the initiatives of Arafat's first prime minister, Abu Mazen, stalled following the collapse of the Roadmap in the summer of 2003. The Israeli government refused to live up to its agreements to declare a settlement freeze and disband unauthorized outposts. It also continued killing Palestinian militants. A truce that Abu Mazen negotiated with the terrorist group Hamas collapsed and, as the cycle of attack and revenge escalated, his authority crumbled. Abu Mazen resigned in frustration after six months. Since then, says one Western diplomat in Jerusalem, "there has been a complete absence of reform, a vacuum of governance. Total stagnation."

To a large extent, the revolt within Arafat's Fatah party reflects a longstanding tension between armed struggle and negotiation, between democracy and dictatorship. Founded by Arafat in Kuwait in 1957 with other Palestinian exiles, Fatah (meaning "conquest") began as a guerrilla movement dedicated to destroying Israel. A series of defeats—the expulsion from Jordan in 1970, Israel's invasion of Lebanon in 1982—bloodied the movement and prompted a gradual reconsideration of Fatah's violent tactics. Israel and the Palestinian Liberation Organization—the umbrella group of armed factions chaired by Arafat and dominated by Fatah—began back- channel talks during Arafat's exile in Tunis, leading to a mutual recognition of both Israel's and the PLO's legitimacy.

Following the signing of the Oslo accords, in 1993, Arafat and his cadres returned in triumph to the West Bank and Gaza. But the Palestinian Authority proved corrupt and dictatorial, and dreams of a Palestinian state died in July 2000, when Arafat rejected as inadequate Prime Minister Ehud Barak's peace offer at Camp David. Within Fatah, proponents of violence soon gained the upper hand, and the region spiraled down into suicide bombings, Israeli missile strikes, reoccupation and economic collapse. "We've lost our dreams of statehood," says one longtime Fatah member. "Now we're asking ourselves, How can we regain our legitimacy in the eyes of the world?"

Several events have coalesced in recent months to galvanize the Fatah reformers. Chief among them: Sharon's plan to disengage unilaterally from the Gaza Strip. While many Palestinians doubt that Sharon will make good on his pledge—or else leave Gaza isolated and economically crippled, with the control of air and sea firmly in Israeli hands—others see the potential pullout of 8,000 Israeli settlers and —5,000 Israeli soldiers as a golden opportunity. "This is a chance to clean up our house, to show the international community that we can rule ourselves," says Abu Mohammed, spokesman for the Al Aqsa Martyrs Brigades in Gaza, which has promised to disarm and merge with the Palestinian security forces if Israel withdraws totally.

The Gaza withdrawal has ignited a power struggle within the weakened Palestinian Authority. At the center of the showdown is Mohammed Dahlan, 42, the former head of Preventive Security in Gaza, who recently emerged as spokesman of a "young guard" demanding both political reforms and the ouster of the corrupt Arafat cronies. Dahlan supporters were behind a spate of violent anticorruption protests in Gaza last month. There was more violence when Arafat appointed his cousin Moussa Arafat as the new police chief of the Gaza Strip. "Moussa Arafat is a criminal," says Abu Mohammed. "We will keep pressing the president until he gets rid of him."

Israel's near-defeat of the Palestinian resistance has also stirred demands for reform. After 3,000 deaths (many of them civilians) and massive destruction, many Palestinians feel exhausted, beaten and skeptical about the logic of continuing the armed struggle. The few active guerrillas in the West Bank admit that attacking Israeli targets has become a near-insurmountable challenge. "The [724km security] wall has made it almost impossible for us to conduct operations," says Zacaria Zubeideh, the leader of the Al Aqsa Martyrs Brigades in the Jenin refugee camp. Battered by Israel's harsh reprisals, ordinary Palestinians have turned their anger toward both the militants and the Palestinian Authority. After Hamas guerrillas fired Qassam rockets from the Gaza village of Beit Hanoun last June, Israeli troops occupied the village for 39 days, destroying houses, razing fields and shooting dead 21 people, both militants and civilians. "We're eating s—t from both sides," complains Mustafa al Refeiri, a farmer whose house and banana plantation were bulldozed by the Israelis during the siege. "If we tell Hamas not to fire, they'll shoot us. And if they fire their rockets, the Israelis will shoot us. We're caught between two fires, and the Palestinian Authority does nothing to help us."

Palestinian leaders are divided on how to continue resisting the occupation. Marwan Barghouti, the jailed Palestinian militia commander, this month issued an 18-point plan that called for an end to attacks on Israel from Gaza, after the withdrawal. The plan made no mention of halting attacks in the West Bank. Others advocate a cessation of all violence. A group called Palestinians for Peace and Democracy last week invited Arun Gandhi, grandson of Mahatma Gandhi, to visit the region on a peace mission. Gandhi, scheduled to arrive in the West Bank on Aug. 22, has denounced suicide bombings.

The reformers say the first priority is to rebuild the near-lawless security forces. Last year a new Finance minister, Salam Fayad, who had run the International Monetary Fund in the West Bank and Gaza for 14 years, launched a one-man campaign to rein in rogue commanders. Until Fayad came along, individual military and police chiefs were disbursing salaries at their own discretion, keeping phantom workers on the payroll, rewarding Fatah loyalists and withholding money from those who refused to toe the party line. Often security men were rewarded handsomely for refusing to arrest militants, or for participating themselves in armed attacks. Fayad demanded that Arafat institute a direct-deposit payment system for the security force's 57,000 employees, bypassing the security bosses. Arafat relented only after the European Union threatened to withhold $50 million in aid to the Palestinian Authority to pay off PA debts.

Reformers say that much more is needed. Last month the five-man PLC committee called on Arafat and Qurei to provide a legal definition of the role of the security forces, and to issue edicts to operate them until those laws are passed. It also urged the Palestinian leader "to use his authority to issue immediate orders to end all the dangerous activity taking place in the Gaza Strip by some of the commanders and men of the armed security forces intimidating the citizenry, creating chaos and harming the supreme interests of the Palestinian people." In July Arafat agreed to consolidate the dozen branches of the security forces into three—a move that reformers say will create more transparency and greater coordination in the fight against terror. He also agreed to surrender control of them to the prime minister, a concession he had steadfastly refused for nearly two years.

The progressives are also pushing on other fronts. Arafat, under pressure from a PLC committee, has agreed to turn over the files on five major corruption cases to the Palestinian attorney general. But Arafat continues to exercise jurisdiction over the prosecutor's office, and Justice Minister Nahed al-Rayes resigned in frustration two weeks ago after Arafat refused to surrender control. "At the moment we have no independent judiciary to punish corruption," Khreisheh says. Reformers are also pushing Arafat to give up another key instrument of power: his appointment of mayors and local councils in the West Bank and Gaza. In May young Fatah leaders persuaded Arafat to agree to hold local elections in Jericho, Beit Hanoun and two dozen other towns and villages. Voter registration is scheduled for September.

Can Arafat really be made to change his ways? Are the Palestinians ready to pursue their aspirations in more legitimate ways? Critics say much depends on the political skill and fortitude of Ahmed Qurei. Though Arafat pledged last week to back his prime minister, Qurei has so far proved himself to be a weak figure who, unlike his predecessor, Abu Mazen, has been reluctant to challenge Arafat. The young guard insists that the Palestinian leader can no longer hide behind Israeli tanks to delay sweeping reforms. In the past he and his circle have used Ariel Sharon's intransigence on settlements, the building of the wall and the reoccupation of the West Bank to argue that the first priority is resistance. "But even if the political track is frozen, you can't freeze internal reform," says Hourani. He and several other Fatah reformers met with Arafat at Moqata, his headquarters, after his speech and were disheartened, he says, by the Palestinian leader's continued intransigence. That may always be the case. But Arafat functions mostly in a reactionary mode now, more follower than leader, and ironically, his people may be the better for it.

With Nuha Musleh in Ramallah

© 2004 Newsweek, Inc.

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