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Monday, March 12, 2007

On money and responsibility

Although we've seen this before, this article in the Telegraph does a good job in describing exactly how screwed up the Palestinian Arab finances are and how it is nearly impossible to fix the problem:
A former World Bank official who is about to become the Palestinian finance minister has warned foreign donors that he has no idea where much of their money has been spent.

In the 14 months since Hamas won elections, Palestinian finances have descended into such chaos that there is now no way to confirm whether aid is going to its stated purpose, according to Salam Fayyad, 54, who is poised to start his second stint as treasury chief once the rival Hamas and Fatah factions finalise a "unity" government.

An estimated £362.5 million has flowed into Palestinian government coffers from abroad since the election that brought Hamas to power and ushered in a period of internal conflict that came close to all-out civil war.

The European Union alone provided £59.5 million last year and sent a far greater sum directly to hospitals, power generation projects and to families in need.

Now, Palestinian Authority spending is out of control, salaries are being paid to workers who never turn up, and nobody can track where the money is going, according to Mr Fayyad.

There was no way to be certain that aid was being used as intended, he admitted. "Please write this: no one can give donors that assurance. Why? Because the system is in a state of total disrepair."

...Ironically foreign aid to Palestinians increased (in 2006), either carried across the border into Gaza in cash-stuffed briefcases by Hamas officials, or through a special financial channel to the office of President Mahmoud Abbas, the leader of the rival Fatah faction with whom the West is prepared to work.

As a result, Mr Fayyad said, incoming funds have been widely dispersed with no central authority to monitor them. Some have gone to people who do not appear on the Palestinian budget ledger. "Where is the control?" asked Mr Fayyad. "It's gone. Where is all the transparency? It's gone."

He said his first objective would be to make the finance ministry the sole conduit for incoming aid, and to reinstate proper audits. That meant no more financial back channels or border smuggling, he said. "It's not my intention to manage the Palestinian budget system through the brown bag." The Palestinian Authority's unchecked proliferation of government jobs - growing by 11 per cent a year - is another threat to its existence, the World Bank said. Mr Fayyad acknowledged that the problem of thousands of absentee employees was "serious", but said it would take up to five years to bring wages into line with income.

He was reluctant to say how he would do that, perhaps understandably, given that unpaid security forces have a habit of barging into government offices with guns blazing, and that gunmen recently shot up the outside of his office.

Now some of Mr Abbas's presidential guard is assigned to his premises - a stark reminder of the connection between restoring security and bringing finances under control. "This will be extremely difficult," he said. "It's virtually impossible."

No doubt the EU will find a solution - give them more money to fix the problems they have of not acting responsibly with their money.

The world community has limited resources to take care of problems. For some unfathomable reason, the corrupt and terror-infested Palestinian Authority and its supporters is a major beneficiary of the world's largesse, and the PalArabs are the highest per-capita recipients of aid - more than Darfur, more than sub-Saharan Africa, more than any place there are truly starving families with no resources at all. What makes the PalArabs so special?

The answer is depressing. The decades of terror plus anti-Israel propaganda has kept the issue of the "poor Palestinians" on the front pages and on the front burner. Infiltrating academia and journalism, aided with a healthy dose of genteel anti-semitism, the idea that the PalArabs are terribly oppressed even as they spend all of their money building bombs and rockets has taken such a hold on the world that it is simply accepted fact.

What is missing from the world's telling of the Palestinian Arab narrative is the idea of responsibility. The PalArabs have a free pass - they can hijack airplanes, they can cheer thousands of American deaths, they can dance as Scud rockets fly towards Tel Aviv, they can praise people who blow up pizza shops and birthday parties - and they get rewarded by the world.

And here's a classic example. They get more money after they elect a terrorist government. They have a long history of squirreling away billions of dollars, of diverting money towards terror, of hiring phantom "policemen" by the tens of thousands, of destroying their own economy.

And yet the world keeps giving them more. The trite phrase "throwing good money after bad" never had more relevance.

No one would treat even family members with such deference.

Is it even possible that the PalArabs would do something so irresponsible that the world community would say "enough!"? Apparently not, because it is hard to imagine them acting more irresponsibly than they already are.