What is the Palestinian Authority (PA)?
–Semi-autonomous Palestinian governing institution created by the Oslo peace process’s Declaration of Principles in 1993
–Rules Gaza and the West Bank, much as the PLO did in the 1970s
As the United States prepares to send approximately $86 million in financial aid to bolster Palestinian Authority (PA) President Mahmoud Abbas’ Fatah militias in the West Bank against possible threats from Hamas, it has been learned that in recent years two PA officials who were Fatah members stole tens of millions of U.S. dollars that also had been earmarked to help Fatah ward off Hamas. One of those officials, Mahmoud Dahlan, smuggled $27 million and invested much of it in construction projects in Dubai. His associate Rashid Abu Shabak, former chief of the Palestinian Security Services, smuggled another $25 million. Palestinian Finance Minister Salam Fayyad’s office reports that of some $60 million in U.S. aid that was deposited in a bank account for Fatah’s exclusive benefit, only $7 million was not stolen. Dahlan and Shabak both fled the Gaza Strip prior to Hamas’ takeover of the region and all its U.S.-backed Fatah security compounds in June.
The Palestinian Authority (PA), alternately known as the Palestinian National Authority, was created by the Oslo peace process’s Declaration of Principles on Interim Self-Government Arrangement, signed on September 13, 1993 by the Government of Israel and by the “Palestinian Delegation” that included representatives of the Palestine Liberation Organization (PLO). Since then, the PA has acted as a semi-autonomous institution nominally governing approximately 99 percent of Palestinians who live in the West Bank and Gaza Strip.
The Palestinian Authority has an observer status in the United Nations. It operates a “police force” with up to 45,000 members (three times the number permitted by the Declaration of Principles and subsequent agreements), many of whom carry automatic weapons and use armored cars as if they were a militia or an army. The PA operates at least 14 different security services, including secret police such as the Preventive Security Service, and controls intimidating street gangs entrusted with the duty of enforcing its edicts by means of fear.
The PA’s chief executive from its inception until his death in 2004 was Yasser Arafat, who also retained his title as Chairman of the Executive Committee of the PLO. Arafat was elected “President” (or more precisely ra’is, Arabic for “head”) of the Palestinian Authority on January 20, 1996, garnering 88.1 percent of the votes. According to PalestineFacts.org, “The date of the elections was more than 18 months later than planned, a delay used by … Arafat to consolidate his grip on the Palestinian populace and silence opposition. Any independent news sources were intimidated into silence, and opposing political organizations quietly disappeared. Arafat manipulated the election with rules to forbid anyone from running against him without his express approval, as reported by the UN election observer team.”
Arafat controlled all PA media by way of the 1995 Palestinian Press Law, which made it a crime for any newspaper to publish articles that “may cause harm to national unity.” In practice, this vague phrase meant that both newspaper print runs and entire publishing companies could be expropriated if they reported anything that displeased Arafat and the PA.
Economically, the Palestine Commercial Services Company is the economic arm of the Palestinian Authority. It owns stakes in many companies and it operates monopolies in industries where the PA prohibits competitors, including the production of cement, commercial sand, flour, oil, and cigarettes. PA operatives are also reportedly involved in a wide range of money-making criminal activities, from extortion and shakedowns of businesses to the counterfeiting of money and merchandise.
The Palestinian Authority collects a five percent “Palestine Liberation Fund Tax” on the incomes of all Palestinians worldwide, which reportedly brings in about $50 million each year.
Under the 1994 Paris Agreement, Israel agreed to transfer to the Palestinian Authority the tax receipts it collected on imported gasoline in PA territory, an amount in excess of $400 million and, under the Oslo agreement, other sales taxes worth about $250 million per year. Israel also transferred to the PA the pension funds accumulated by Palestinians who worked for the Israeli Civil Administration. For Gaza employees alone, this amounted to $160 million, $140 million of which was promptly spent by Arafat for other purposes.
Moreover, during Arafat’s tenure the PA received up to $1 billion each year in aid donations from the United States, Europe and Arab states. Total annual foreign aid to the PA rivaled, and may have exceeded, the level of funding the United States provides to Israel. Accounting for what happened to this money, as well as to other Palestinian Authority revenues, is difficult. “I refused and I will never accept!” said Yasser Arafat of oversight conditions proposed for aid by the International Monetary Fund in July 1994. “I completely refuse any controls by anybody on Palestinian Autonomy, except the Palestinians themselves. We didn’t finish military occupation to get economic occupation.”
According to financial investigator Rachel Ehrenfeld, “Jawad Ghussein, until 1996 the Secretary General of the Palestinian National fund, told the Ha’aretz newspaper in August 2002 that Arafat ‘took aid money and contributions [approximately $8 million each month] that were earmarked for the Palestinian people to his own account.'” Ghussein had added up $540 million that he knew had been diverted into Arafat’s personal bank account.
A United Nations report suggests that Arafat also diverted a large proportion of the aid money received by the PA to his various militias. In Spring 2000, Israeli troops seized documents in Arafat’s Ramallah headquarters showing Arafat’s approval for a $20,000 payment to the Al-Aqsa Martyrs Brigades, many of whose members also received paychecks from the PA as official employees of its security services. Further evidence of PA malfeasance came to light in February 2004, when it was reported that the European Union’s anti-fraud OLAF office was studying documents indicating that Arafat and the PA had diverted tens of millions of dollars in EU funds to terrorist organizations. Marwan Barghouti, leader of Arafat’s Fatah/Tanzim militia in the West Bank, reportedly continued to receive his $2,500-per-month salary from the Palestinian Authority even after he was arrested and indicted for the murder of 26 Israelis.
Since 1994, when almost all Palestinians living in Israel came under the autonomous and independent control of the PA, the economies of the West Bank and Gaza Strip have been crippled by the Authority’s despotic rule. By 2003, the West Bank’s GDP had shrunk to about one-tenth of what it had been in 1992 — a result of the PA’s misappropriation of more than $5.2 billion into the personal accounts of Arafat and his lieutenants and militias. The Second Intifada, which began in September 2000, also contributed to the sharp deterioration in Palestinians’ living standards. The poverty rate nearly tripled, from 20 percent in 1999 to 55 percent in 2003. Once-prosperous commercial towns became economic basket cases.
As early as 2001, the Government of Israel had designated the PA as an “Entity Supporting Terrorism.” In 2004, Papal Nuncio Msgr. Pietro Sambi described the Palestinian Authority Constitution as the “framework for a totalitarian Islamic terror state.” In April of that year, Arafat told the German magazine Focus that he was prepared to share power with the terrorist groups Hamas and Islamic Jihad in a new leadership structure that would operate in parallel with the Palestinian Authority. Arafat had released many members of both groups from PA jails.
After Arafat’s death, he was succeeded as the leader of both the PA and Fatah by Mahmoud Abbas, a.k.a. Abu Mazen.
In a January 2006 election, Hamas became the dominant force in the PA by winning 76 of the 132 parliamentary seats, giving that party the right to form the next Cabinet under President Abbas. On March 29, 2006, Hamas formally took the reins of Palestinian government. The new 24-member Hamas Cabinet included 14 ministers who had previously served time in Israeli prisons.