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Israel Could Cut Off Hamas' Allowance

Israeli officials confirm an American newspaper report that they are looking for ways to topple Hamas from power, CBS News correspondent Robert Berger reports.

Berger reports the officials say Israel intends to cut off $50 million monthly tax payments to the Palestinian Authority if Hamas forms what they call a terrorist government. The officials say they expect the U.S. and Europe to follow suit.

However, some officials warn that a cutoff of aid could lead to chaos, sparking more Palestinian violence and terror.

The New York Times reported Tuesday that this approach was being discussed at the highest levels of the U.S. State Department and the Israeli government. The ultimatum to Hamas will be either to recognize Israel's right to exist, abandon violence and accept previous Palestinian-Israeli agreements, or risk isolation and eventual collapse, the newspaper said.

The State Department Tuesday denied the U.S. part in the story, says CBS News reporter Charles Wolfson.

"There is no plan and no plot," State Department spokesman Sean McCormack said. "We'll wait for the next Palestinian government and see what their policies are, then respond. Meanwhile, the Quartet's statement is basis for action."

Mushir al Masri, a Hamas spokesman and incoming legislator, said attempts to bring down a future Hamas government were hypocritical.

"This is ... a rejection of the democratic process, which the Americans are calling for day and night," said al Masri. "It's an interference and a collective punishment of our people because they practiced the democratic process in a transparent and honest way."

In other developments:

  • Egyptian President Hosni Mubarak thinks Hamas militants soon to head the Palestinian government will succumb to international pressure and renounce their violent campaign against Israel, Israel's Defense Minister Shaul Mofaz quoted him Monday as saying. Mofaz also said Mubarak pledged to "exert all of his efforts to make Hamas accept all the Israeli conditions."
  • Acting Israeli prime minister Ehud Olmert is setting a four-year time frame for drawing Israel's permanent borders. Speaking in parliament, Olmert said the goal is to preserve Israel as a Jewish state, reports Berger. That means relinquishing parts of the West Bank with a large Palestinian population. With Hamas in power, Israel says there is no peace partner. So Olmert has hinted that if he wins March elections, he will draw the borders unilaterally.
  • An Israeli court Tuesday sentenced the eldest son of Israel's ailing Prime Minister Ariel Sharon to nine months in jail Tuesday after he pleaded guilty to illegally raising funds for one of his father's political campaigns.
  • In a direct slap at Hamas, the outgoing Palestinian parliament, dominated by Fatah, on Monday gave Palestinian leader Mahmoud Abbas, who is also the head of Fatah, extended powers to counter Hamas legislation. Abbas would have the authority to appoint a new, nine-judge constitutional court, which would serve as the final arbiter in disputes between him and a Hamas parliament and Cabinet.
  • Israel plans to gradually reduce compulsory military service from three years to two. The reduction is due to begin next year, when soldiers in combat units will have their service reduced by four months. It's an astonishing change in a country where the army plays a prominent role as soon as young people get out of high school, reports Berger.

    Hamas swept Jan. 25 Palestinian elections on the strength of public dissatisfaction with Fatah's failure to eradicate lawlessness and corruption. It has repeatedly rejected Western demands to change its violent ways.

    Peace negotiations have been frozen since 2000, when the latest round of Palestinian-Israeli violence erupted. In 2003, President Bush formally presented the internationally backed "road map" peace plan that envisioned a Palestinian state after three stages of negotiations, but the talks stalled at the outset.

    Chances for renewed talks dimmed when Hamas swept the Palestinian parliamentary election last month. Hamas rejects the presence of a Jewish state in the Middle East and has sent dozens of suicide bombers, who have killed hundreds of Israelis.

    Former U.S. Ambassador to Israel Martin Indyk told Wolfson Hamas' electoral victory and the policy bind in which Israel and the U.S. find themselves are "a disaster that can only grow worse."

    "It's a mess and there are no good options," Indyk added.

    The strategy to withhold aid is not new. Since Hamas' electoral victory, the West has been threatening to withhold nearly $1 billion in annual aid to the Palestinians, though Russia's recent invitation to Hamas to visit Moscow, and France's support for the Russian approach, have cracked the united front.

    Israel has also threatened to cut off monthly transfers to the Palestinians of about $50 million from taxes and customs it collects for them, once Hamas takes power. The new Palestinian parliament is to convene for its first session on Saturday, and a new Cabinet is expected to be appointed within weeks.

    What is new is the strategy to force regime change by impoverishing the Palestinians even further, according to the newspaper report. As the U.S. and Israeli officials see it, Palestinians would grow so miserable that Palestinian leader Mahmoud Abbas, Fatah's leader, would dissolve parliament and call early elections within months, the New York Times said.

    The strategy's risks include the probability that Hamas would try to make up withheld money from the rest of the Muslim world, and from private donors, and that Palestinians would blame the United States and Israel, and not Hamas, for their growing misery, the newspaper said. Hamas has already tried to drum up more money from the Muslim world, but has received commitments so far, and no cash.

    Besides the cash squeeze, Israel has other leverage on the Palestinian Authority, including its control of the movement of people and goods between the non-contiguous West Bank and Gaza Strip, and the number of workers allowed into Israel, the newspaper noted.

    Legal expert Issam Abdeen said the last-minute Fatah-dominated Palestinian parliament legislation would essentially give Abbas power over what laws the new parliament passed "since he is the one who appoints the judges of the constitutional court."

    Hamas officials said they would immediately try to overturn the laws after the new parliament is sworn in Saturday.

    The last-minute legislation "is a kind of bloodless coup," charged Abdel Aziz Duaik, an incoming Hamas legislator. The new law "puts complete authority in the hands of the president," he said.

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