Commentary Magazine


The IMF and the Terror State

The Palestinian Authority’s campaign to bypass negotiations and gain recognition for an independent state received an important boost yesterday from the International Monetary Fund. The IMF issued a report about the economy in the West Bank and Gaza, which will be formally presented an international donors conference for the Palestinians next week in Brussels.

The report is a resounding endorsement of the policies enacted by Palestinian Prime Minister Salam Fayyad. The PA is “now able to conduct the sound economic policies expected of a future well-functioning Palestinian state, given its solid track record in reforms and institution-building in the public finance and financial areas,” the IMF says. Fayyad’s efforts to transform the PA from the corrupt terror state created by Yasir Arafat after the Oslo Accords has been widely praised by both Americans and Israelis. But even those who vouch for the good intentions and skill of the American-educated technocrat would have to acknowledge that he has only just begun to change the mafia-style political culture of the PA.

The IMF report makes it clear that the West Bank, run by Mahmoud Abbas’s Fatah—Fayyad was appointed by Fatah—is still mainly dependent on foreign aid. As for Gaza, which is governed by the Islamist terrorists of Hamas, it remains an economic basket case. But the report, which rightly predicates future growth on the emergence of vibrant Palestinian private-sector economy, says that is “unlikely to emerge while Israeli restrictions on access to natural resources and markets remain in place, and as long as investors are deterred by the increased cost of business associated with the closure regime [in Gaza].”

The real question, though, is not whether Israel can be pressured to lift its blockade of Gaza or what security measures it employs in the West Bank, but why those policies are still necessary.

The answer comes in the form of the Palestinian missile fire from Gaza that was once again launched at southern Israel today. This morning an Israeli school bus was hit by an anti-tank missile, leaving a 16-year-old critically injured and wounding the driver. Another rocket aimed at Israel was intercepted by an anti-missile battery. These were just the latest of over 100 rockets and mortar shells fired into Israel from Gaza in less than a week. Israeli President Shimon Peres called attention to the Gaza missile attacks today during a visit to New York. For all intents and purposes Gaza is an independent self-governing entity since Israel withdrew all troops and civilians from the strip in 2005. Since then it has been transformed, Peres said, into a “terror state.”

For all of the optimism heard from the IMF about the prospects of an independent Palestinian state, the brute fact is that one of its two prospective governing parties is carrying on a war to extinguish the Jewish state and to kill as many Jews as possible in the mean time. Even in the West Bank, which has made great strides under the leadership of Fayyad (support for whom remains tiny when compared to the belligerents of the main Palestinian movements), the terror threat against Israel is palpable. Should the current autonomy of the PA be expanded to complete independence without an Israeli security presence, there is ample reason to worry that either Hamas operatives or Fatah’s own terrorists will be able to replicate the terror state in Gaza.

Right now the Palestinians appear to be counting on a United Nations General Assembly vote to recognize Palestinian statehood in all of the territory of the former Palestine Mandate that was illegally occupied by Egypt and Jordan from 1949 to 1967. It is not clear how strongly this attempt to evade negotiations will be resisted by the United States and the diplomatic quartet, or whether they will oppose it all. No doubt reports like the one issued by the IMF will be cited as a reason to drop back and permit the Palestinians to have their own way.

A two-state solution to the conflict is the worst possible idea—except for all the others. There should be no doubt that any Palestinian state endorsed by the UN will not be a liberal democracy. It will not have the free economy that Fayyad and the IMF envision. It will be a two-headed terrorist monster whose political culture will remain dedicated to pursuing the decades-old Arab war on Israel. Unless the PA agrees to negotiate a peace that recognizes Israel as a Jewish state and guarantees its security, there should never be recognition of a Palestinian state.

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