Prepared for the
Conference of Presidents of Major American Jewish Organizations

in association with the Fairness Project
by the Jerusalem Center for Public Affairs
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August 26, 2002

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In-Depth Issue:

Just Released:
Follow the Money -- Where Do International Contributions to the Palestinian Authority Really Go?

By keeping a double set of books, the Palestinian Authority has systemically channeled at least 14% of its public budget, as stated to the IMF and donor states, to Fatah, other terrorist organizations, and various covert destinations. An explanation of captured original Arabic documents (with their English translations) details the mechanism of this multi-million dollar money-laundering operation that has turned international humanitarian aid into support for terror and suicide bombing.
    Since its creation, the Palestinian Authority (PA) has received some U.S. $4.5 billion in international aid and investment. Since the beginning of the current Palestinian/Israeli conflict in September 2000, the international community has provided the majority of the PA�s monthly operating budget of some $90 million. An international investment of well over $1,000 per capita in civilian aid would normally be expected to show significant results � and yet, it is difficult to identify any real benefit this aid has produced for ordinary Palestinians.
    Some of the documents described in this report prove the connection between PA financing of the Fatah/Tanzim, and suicide bombings and other terrorist attacks carried out against Israeli civilians.
    A very large portion - some 45 percent, or $27 million per month - of the published Palestinian Authority payroll budget consists of money that does not reach PA employees. All of this money is available for other uses. While we do not know where all this money goes, we do know that a substantial portion of it is used to support terrorism against Israeli citizens. (IDF Spokespersons Office)

Saddam Killed Abu Nidal over al-Qaeda Row
Abu Nidal, the Palestinian terrorist, was murdered on the orders of Saddam Hussein after refusing to train al-Qaeda fighters based in Iraq. Western diplomats believe that he was killed for refusing to reactivate his international terrorist network. Saddam wanted Abu Nidal to carry out attacks against the U.S. and its allies. U.S. Defence Department officials said that a number of very senior al-Qaeda members was now based in northern Iraq close to the Iranian border at Halabja. (Telegraph - UK)

Useful Reference:

Answers to Frequently Asked Questions on Palestinian Violence and Terrorism
(Ministry of Foreign Affairs)

Key Links

Media Contact Information

Back Issues

News Resources - USA and Europe:

  • Palestinian Militia Executes Woman
    A Palestinian militia in Tulkarem shot and killed a Palestinian woman suspected of collaborating with Israel Saturday. Dozens of suspected Palestinian collaborators have been killed since the beginning of a Palestinian uprising in September 2000, but Ikhlas Khouli was the first woman reported executed. Her son said Sunday that Palestinian gunmen tortured him until he invented a story about his mother's involvement in a militant's death. (AP/Washington Post)
  • Hard-line Refugees Won't Budge on Israel
    None of the major obstacles to peace will be easily overcome, but on some issues, such as Israeli settlements in the occupied territories and the status of Jerusalem, tentative agreements have been drafted, and the sides agree that the potential for a final resolution exists. Not so the refugee issue. An overwhelming majority of Palestinian refugees say they want to go home to Palestine, and the younger they are, the more absolutist they seem. (Boston Globe)
  • News Resources - Israel and Mideast:

  • Ya'alon: Palestinian Terror Is Israel's Greatest Threat
    IDF Chief of Staff Moshe Ya'alon on Sunday termed Palestinian terror the greatest threat to Israel's security, and warned that it was spreading like a cancer. Speaking at the annual convention of rabbis in Jerusalem, Israel Radio reported that Ya'alon said Israel needed to win the conflict with the Palestinians in order to make them understand that no diplomatic achievements could be achived through the use of terror. (Ha'aretz)
  • Sticking with the "Bethlehem-Gaza" Plan - For Now - Ze�ev Schiff
    Despite the slow progress in advancing regional cease-fires (Gaza and Bethlehem First), the IDF is sticking to the plan without setting a timetable. The PA is engaged in a difficult debate with the Hamas, and the defense establishment is waiting to see how that turns out. If indeed there is a further decline in the number of incidents, the next step will be up to Israel. It does not appear that at this stage Israel intends to move to lines it held previously in the Gaza Strip, but it does intend to open roads to traffic, to expand the fishing zone for the Palestinians in the Mediterranean, and to allow thousands more Palestinians into Israel to work. These are all humanitarian steps that will have an economic influence on the population (Ha'aretz)
    See also Ben-Eliezer: 'Gaza, Bethlehem First' Plan Continuing as Planned
  • Saudi Royals Paid Off bin Laden - Sunday Times (UK)
    Senior members of the Saudi royal family paid $300 million to Osama bin Laden and the Taliban to prevent them attacking Saudi Arabia, the London Sunday Times reported yesterday. The cash enabled al-Qaida to fund training camps in Afghanistan that are said to have been attended by the September 11 bombers. The court documents reveal that the agreement committed bin-Laden not to use his forces to subvert the Saudi government. (Jerusalem Post)
  • Arafat�s Still Here - Danny Rubenstein
    The chairman is holding fewer and fewer meetings with senior statesmen, making and getting fewer important international phone calls and exchanging fewer messages of political or diplomatic value. Just a few weeks ago, diplomats and journalists from all over the world were preoccupied with the status of the Palestinian leader who was under siege by Israel in his headquarters in Ramallah. Yet now he seems to be forgotten. Has Arafat's leadership effectively ended? The three-man kitchen cabinet that operated alongside Arafat during the siege no longer exists. Arafat's status may be wretched these days, but even in this state of affairs, no one is challenging his leadership - he is stronger than all the others. (Ha'aretz)
  • Global Commentary and Think-Tank Analysis (Best of U.S., UK, and Israel):

  • Armed, Crazy and Dangerous - Mortimer Zuckerman
    The question now is asked: How can the U. S. justify initiating hostilities against Iraq at a time of peace? It is the wrong question. Better to ask how America can justify not going to war against Iraqi dictator Saddam Hussein - and at the earliest possible moment. Before Saddam evicted the UN weapons inspectors, they discovered nearly 20,000 liters of concentrated botulinum, the most deadly substance on Earth, and nearly 9,000 liters of anthrax. More recent intelligence reporting suggests an intense, almost fanatical Iraqi effort to acquire fissionable materials, miniaturization equipment for atomic weapons and, perhaps, ballistic missiles. British intelligence recently revealed that Saddam was planning to give biological weapons to Palestinian terrorists to attack America and Israel. Those who predict dire results if we try to unseat Saddam simply refuse to understand that if we opt to live with a nightmare, it will only get worse. The best medicine is preventive medicine. (NY Daily News)
  • The Right Way to Change a Regime - James A. Baker III
    Peace-loving nations have a moral responsibility to fight against the development and proliferation of weapons of mass destruction by rogues like Saddam Hussein. The only realistic way to effect regime change in Iraq is through the application of military force, including sufficient ground troops to occupy the country (including Baghdad), depose the current leadership and install a successor government. Anyone who thinks we can effect regime change in Iraq with anything less than this is simply not realistic. The U.S. should advocate the adoption by the UN Security Council of a simple and straightforward resolution requiring that Iraq submit to intrusive inspections anytime, anywhere, with no exceptions, and authorizing all necessary means to enforce it. We cannot allow our policy toward Iraq to be linked to the Arab-Israeli dispute, as Saddam will cynically demand. But to avoid that, we need to move affirmatively, aggressively, and in a fair and balanced way to implement the president's vision for a settlement of the Arab-Israeli dispute. That means, of course, reform by Palestinians and an end to terror tactics. But it also means withdrawal by Israeli forces to positions occupied before September 2000 and an immediate end to settlement activity. (New York Times)
  • Don't Isolate Israel, Use It - Neill Lochery
    As Israeli involvement in any conflict is inevitable, it makes sense for U.S. planners to coordinate planning activities with their Israel counterparts. The most obvious use of Israel would be in the intelligence field. Israel could contribute to the widely expected air campaign, and by employing its Special Forces to destroy Iraqi mobile missile sites on the ground. Israel exists in a dangerous neighborhood. President Bush should - if he hasn't done so already - give the order to his military advisors to involve Israel in the planning and execution of the war. The brutal truth is that this will be Israel's war as much as America's. (UPI International Desk)
  • A Promise the U.S. Makes, But Does Not Keep - Nathan Lewin
    After the murder of five Americans last month in Jerusalem - victims of a bomb placed by Hamas in a Hebrew University cafeteria - the Justice Department dispatched an FBI team to investigate. The record shows that past U.S. investigations of murdered American citizens in Israel have been a sham. The Justice Department has not returned a single indictment involving any of the 36 Americans killed in Israel since the 1993 Oslo agreement. The refusal to enforce the law has encouraged the terrorists to strike at places such as Hebrew University, where, they knew, young Americans would be found. (Washington Post)
  • Implications of America's Dual-Track Approach to Iran - David Menashri
    The forceful American stance has come as an unpleasant surprise to Iran's rulers, because it touches some very sensitive nerves. After five years in office, Khatami has overseen some significant changes. The reform movement's achievements include a penetrating public debate even on such delicate issues as religion and state, Islam and democracy, and attitudes toward the U.S. and even Israel. Nevertheless, there has been no real shift in the domestic balance of forces or in policy on issues of greatest concern to the U.S. The conservatives have so far retained effective control. Since Bush�s July declaration, the domestic debate in Iran has taken on a new intensity. But as the internal struggle reaches new heights, it is important to view the changes in Iran in a longer-term historical perspective. In that perspective, the conservatives are swimming against the current of change. (Dayan Center - Tel Aviv University)
  • Talking Points:

    Israel Aspires to a True Peace - Summary of Israeli Cabinet Meeting - August 18, 2002     (Embassy of Israel, Washington)

    • The Government of Israel's objective is to reach a political settlement; Israel aspires to a political process that will lead to a true peace. Israel insists on the following conditions for a genuine process: 1. A halt to terror, violence and incitement, and 2. Genuine security, economic and legal reforms in the Palestinian Authority.
    • In order to reach peace a different Palestinian leadership, one that is not stained by terror, is necessary. The Government of Israel will not give in on these issues.
    • Regarding humanitarian issues related to the plight of the Palestinian civilian population, the latter must be assisted in every way possible.
    • When Israel proceeds to the political process, it will insist on a settlement in stages that will enable oversight and progress according to the degree to which the parties' commitments are being upheld and carried out, and according to developments in relations between Israel and the Palestinians.
    • There will be no compromises in the struggle against terror. Israel is vigorously conducting the struggle beginning with actions to interrupt the smuggling of weapons and munitions; actions against terrorist leaders; the presence in the Palestinian cities; and, first and foremost, reliance upon our forces.
    • The unfreezing of 10% of the Palestinian VAT funds being held back by Israel. The continued gradual unfreezing of funds also depends on Palestinian moves and the uses to which the funds are put.
    • Unity has been, and remains, supremely important to the success of Israel's stand in the political and diplomatic struggle.

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