Thousands of young Palestinians out on the streets – chanting slogans, throwing rocks, burning tires. Working class drivers striking to protest against the price of gas, middle- class merchants shuttering their shops to avoid damages and the moneyed classes chattering nervously about whether this is really as momentous as it looks.
The images are reminiscent of the first intifada almost 25 years ago, except that the fire this time is largely focused not on Israel but on the Palestinian leadership.
Yet Palestinian society is far more complex than it was a quarter of a century ago, and not everybody has the same reading on what the protests erupting across the West Bank really mean. Some hail the unrest as the belated birth of the Palestinian Spring, taking its cues from start of the upheaval that began in a small Tunisian city two years ago this December.
There too, in Sidi Bouzid, the protests initially seemed to be of a localized, economic nature, and some dismissed it as little more than a bread riot that would blow over. The revolution’s patron saint, Mohamed Bouazizi, was a struggling street vendor who, fed up with trying to survive and outraged over the confiscation of his wares, set himself on fire – and helped fan the fires of frustration throughout the Middle East.
If a man who sold produce from a cart could start a revolution, what about a taxi driver who, once he pays NIS 8.25 for a liter of gas, hardly has enough take-home pay to put food on the table? Or a merchant whose profits are being eaten up by the value-added tax being tied to Israel’s, which just went up to 17 percent? Or the nearly 40% of Palestinians who are dependent on publicsector jobs, where salaries have been delayed because the Palestinian Authority simply doesn’t have enough to make payroll? Salaries not paid in July and August have made people doubt that things will get any better in September.
“It is a very deep crisis because 180,000 people are public sector employees. You multiply that by five, and realize that at least one million depend on those salaries,” explains Samir Barghouti, a Ramallah economist who runs the Arab Center for Agricultural Development.
In the past, he noted, whenever the PA’s balance sheet went into the red, it could depend on donor nations, particularly wealthier Arab countries, to help it out. As a byproduct of the Arab Spring, he says, most of the leading Arab countries are far less focused on Palestinian issues.
“Other donor countries, particularly the Arab countries, are busy with the Arab Spring, and the international priority is to finish with Syria, so they don’t care so much about what is going on in Palestine,” he says.
“Also, some of them are not satisfied with [Palestinian President] Mahmoud Abbas, and they think maybe it is not the time to be going again to the UN and to challenge the US,” he adds, in reference to Abbas’s plans to submit a new bid on September 27 for the UN to recognize a Palestinian state.
Indeed, the crisis is neither exclusively political nor economic, but has elements of both feeding on each other. For example, says Barghouti, some of the Palestinian politicians who were already unhappy with PA Prime Minister Salam Fayyad are using the crisis as an opportunity to pin problems on him.
“There are some people within Fatah who do not want Salam Fayyad in office anymore, and they are saying it publicly. They believe it is an opportunity to achieve what they want, and they’re finding a way to use the economic crisis to get it,” he says.
Some of the factors leading to the crisis are clearly beyond the Palestinian leadership’s control, such as soaring gas prices and global economic forces.
But what is specific to the Palestinian predicament, and which stands at the heart of the current frustration, is the Paris Protocol, the framework that established economic relations between Israel and the PA in 1994.
To the average young protester burning up a copy of the protocol, it is largely a symbol of Israeli control over the Palestinian economy. But even to more nuanced minds, including several Palestinian economists interviewed for this article, the Paris Protocol is dragging the PA economy down in a palpable way.
“The articles are a disaster for Palestinians, but during the last 15 years we did not ask to review or change it, and that shows we don’t have the right management for a crisis such as this,” says Talaat Alawi, editorin- chief of the Al Safeer economic newspaper in Ramallah.
“We as consumers are paying almost the same VAT as an Israeli living in Tel Aviv or Haifa, while the per capita income in Israel is almost $30,000, whereas in the Palestinian Authority it’s about $2,000. It is a fixed tax, in which poor and rich pay the same rate, so it’s an unfair tax, an so much more burdensome for Palestinians.”
He says that an appropriate tax for the Palestinian economy would be 9%, but the PA has no right to make adjustments.
Fayyad’s announcement Tuesday that he would reduce it from 15.5% to 15% was insignificant, Alawi says.
“The most important issue, and this is a very negative point that sheds some light on how we see the Palestinian government, is that the Paris Protocol should have been a temporary protocol, from 1994-1999, and yet our government has been upholding every protocol in there,” Alawi adds.
Trying to ride the wave of wrath, Abbas has asked Israel to revise the protocols. Deputy Foreign Minister Danny Ayalon on Monday answered him with a resounding no.
“There is no room to fix it when there is no progress in the political channel, and the Palestinians have huge debts to Israel for transferring gas and electricity, for example,” Ayalon said.
Refusing to reopen the accords, however, could put Prime Minister Binyamin Netanyahu in an extremely difficult position. He has said repeatedly in the last few years that while he is not rushing into an agreement with the Palestinians that will involve further territorial compromises, he is making significant moves to boost the economy in the West Bank and improve the lives of many Palestinians.
Meanwhile, some analysts say it is an exaggeration to call the current crisis the latest chapter of the Arab Spring.
Notes Jamil Rabah, the codirector of Near East Consulting in Ramallah, it will not lead to the ouster of a president, as it did in Tunisia and Egypt, nor is it about getting out from under the thumb of a murderous regime, as in Syria. Rabah says it is more like Israel’s economic protest during the summer of 2011, in which tent cities sprung up around the nation.
“I keep going around to check how serious this is, and I don’t think it is as big as it’s been hyped to be,” Rabah says.
“I don’t think it’s a Palestinian Spring. Yes, people are tired economically, but it is not translated to unrest against the PA as a legitimate government.
It is true people are unhappy with what’s going on, but it’s largely the lack of economic support from Arab regimes and the controls on us by Israel that puts the PA in a difficult situation.”
What the crisis drives home, he says, is not just the taxation issues vis-à-vis Israel, but that the PA has failed to reduce its dependency on foreign aid and still is not effective in collecting taxes, except from the largest companies.
“People want services, but who’s to pay for them? The PA is afraid to go and collect taxes because they don’t want to burden people. They do collect taxes in the West Bank, but not in manner which is strongly enforceable, they don’t want to be perceived as an additional burden,” he says.
Barghouti agrees. More then we are 35% of the PA budget comes from international donors, a situation that simply isn’t sustainable, he notes.
“The problem is that the Salaam government and the PA never came up with a plan to reduce dependency on international support,” he says. “They’ve had enough time, almost 20 years to do that, and they haven’t.”
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