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Wednesday, June 11, 2014

Why the poor 'Palestinians'

The cost of PA corruption is monumental. More than anything else, it makes Palestinian political and economic progress all but impossible. The poor quality of governance and the resulting lack of political inclusiveness and economic opportunities in the Palestinian territories are a surefire model for the kind of economic and political repression that typifies underperforming societies. You will not find a single example of a people governed by such a regime that has achieved long-term success. The inevitable result is social stagnation and the kind of discontent that can lead to violence and even war.
In one of my favorite examples of how Palestinian governance is subservient to political power, the PA still pays its Gaza-based employees even though they are unable to perform their duties due to the Hamas takeover. In other words, the PA—using donor funds—is paying people not to work. There is only one reason for this: It allows PA President Mahmoud Abbas to maintain his political base in Gaza.
Perhaps more infuriating, however, is the fact that an enormous amount of PA money—foreign and domestic—goes to line the pockets of the Palestinian political elite. About two years ago, Hasan Khreishah, the deputy speaker of the Palestinian Legislative Council, spoke out on the issue. “Since the signing of the Oslo Accords,” he said, “we have had 12 Palestinian governments…. Each government [has]… at least 24 ministers. This means we have had 228 ministers, in addition to advisors. All receive high salaries and luxurious vehicles.” He went on to point out that the aforementioned PIF pays its chairman $35,000 per month, which is over 12 times the West Bank’s per capita gross domestic product in 2008—the most recent data available.
This is, unfortunately, the PA’s standard operating procedure. An EU audit of the years 2008-2012 found that around 2 billion Euros of its aid were lost to corruption. It has also been shown that Yasser Arafat and his advisors stole millions of dollars in foreign donations, turning them into billions as they moved the money around the world. According to several reports, this practice has continued—and may have gotten worse—under Abbas. And with the Palestinians’ acceptance into the United Nations Convention Against Corruption, the PA will now have a shield with which to protect itself from any real reform.
Many supporters of the PA tend to look for ways to explain away these problems. They have composed a popular narrative in which, despite the PA’s corruption—or perhaps regardless of it—the Palestinians’ problems are primarily Israel’s fault. Economic and political development in the Palestinian territories, it is claimed, can only move forward if Israel withdraws from the West Bank, voids its security requirements for border movement, and allows the free flow of people and goods.
I have witnessed something different. I have observed the West Bank economy and labor market from within, and have come to understand that the best opportunities for Palestinians are abroad. Not only do foreign markets offer larger consumer bases and greater profits for exporters, but most importantly they do not suffer from the corruption experienced under the Palestinian Authority that stifles prosperity well beyond any other factor. Even within the West Bank economy, many of the best opportunities come from Israeli and foreign assistance.
Given that the highest profit margins for Palestinian goods are found outside the territories, such assistance is essential. And given that Israel is the Palestinians’ main point of access to foreign markets, its help is equally important. Even though many opportunities for economic development are initiated by aid agencies and NGOs from the West and Asia—such as the project Sammy Khalidi participated in—they not only require Israel’s help, but also benefit from direct Israeli participation that mostly goes unreported. This is partly because Israel’s assistance can be politically unpopular domestically, but it also because, as in Sammy’s case, it does not fit the narrative people are comfortable with.

Read the whole thing.

As you might have figured out from the cartoon above, I am not convinced that the 'Palestinians' would make peace with Israel even if they had an economy.  But what it would lead it is something far more dangerous from the 'Palestinian' elite's perspective: contentment with the status quo, a lessening of the desire for a 'Palestinian state' now, and most importantly, a dissipation of the desire to extirpate the Jewish state. Aside from pure greed, those are the motivations behind the continuing corruption in the 'Palestinian Authority' and the acceptance of that corruption by the overwhelming majority of the elites in the international community who turn a blind eye to it.

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