Economic and Political Corruption

Shoshana Bryen
Senior Director for Security Policy
JINSA Report #: 1,053
January 18, 2011

Secretary of State Clinton called for an increase in civic space in the Arab world and an end to the corruption that sucks the economic life even - or especially - out of poor countries with an educated workforce. But when she spoke of America's commitment to Palestine, she said nary a word about corruption in the state-in-waiting.

Human rights organizations in the West Bank are increasingly vocal about abuses by the Palestinian security apparatus - trained and assisted by the U.S. and Israel - arresting, imprisoning and torturing Palestinians. Who draws the line between protecting Fatah from Hamas and protecting it from its own people?

On the economic front, a new study shows that more than 60% of the PA's GNP comes from outside donors, including the U.S. and the EU. Economists Ayal Ofer and Adam Roiter wrote, "Employers lack the ability or the will to go into industry or development, because they cannot compete with the salaries of governmental organs and that of the aid workers on the ground." Donor funds "go into the pockets of bureaucratic echelons and to the monstrous administrative apparatus that mostly deals with allocation of funds and fundraising... the business sector is left at a standstill."

In November, Kieron Monks wrote in The Guardian (UK) of the failure of international aid agencies to create development. "Palestine's NGO sector has become a byword for corruption, incompetence and meaningless job creation. Thousands of NGOs have sprung up... bloating the aid industry without delivering long-term benefits. [This] has entrenched class divisions in Palestinian society. Employment opportunities within them are typically limited to the educated elite class, narrowed further by routine nepotism."

How are young Palestinians supposed to understand their avenues for economic and social advancement? It is through the lens of political, military and economic corruption that the future of "Palestine," as well events in Tunisia and Lebanon, should be viewed.

Tunisia was seen in the West as a model of Arab moderation with educated women, secular judges, and free public education. But it was presided over by a corrupt absolute dictator who set up phony opposition parties and spied on the people. The riots that deposed the dictator do not appear to have Islamist roots; they started with the self-immolation of a university graduate who couldn't find a job. Educated young people have been protesting poor economic prospects and the corruption of the ruling class, not seeking the imposition of religious rule. The army, which appears to be working without civilian authority, is ruthlessly trying to re-impose order. It is unclear who will emerge in control.

Lebanon is more or less democratic - more when people read their free press and vote for one of the multiple parties, less when Hezbollah kills scores of people in Beirut to obtain seats in the Cabinet it couldn't otherwise get. And the heavy hand of Syria and Iran - wielded through Hezbollah - hangs over the landscape. Obey, and there will be relative peace and bursts of prosperity. Don't obey - as in Prime Minister Saad Hariri's decision not to cancel the UN Special Tribunal on the assassination of former Prime Minister Rafik Hariri - and not only will the government collapse, but the threat of violence, both internal and external, will rise.

The United States has a limited ability to influence events in Lebanon and Tunisia, both look more to France than to us. For the United States to push for the creation of another small, chronically poor and endemically corrupt country mocks Mrs. Clinton's apparent understanding of the sort of governance that produces prosperity and civic institutions that provide for challenges and the redress of grievances without violence and repression.

By the way, in Israel over the weekend, the venerable Labor Party split into two factions. One quit the governing coalition, the other remains amenable to negotiation with Likud to stay in. In addition, the Labor Party appears to be trying to force out one of its recalcitrant members to open a seat for an ally of the new leadership. No guns, no riots, no army. Ho hum.

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