November 2004 - cypherpunks-legacy

Re: Your source code, for sale
by Tyler Durden 05 Nov '04

05 Nov '04

Ben Laurie made a lot of useful points. However,... >Simultaneous release is (provably?) impossible without a trusted third >party. I don't think I believe this. Or at least, I don't think it's true to the extent necessary to make the original application impossible. Consider: I send you money for naked photos of Geri Ryan (that Borg chick with the ASS-KICKING hips). The money is "encapsulated"...you can its there, but you can't get at it. You send me encapsulated photos, perhaps with thumbnails on the outside. I see the thumbnails and click to send the pre-release. You see the pre-release arrive and click the release for the photos. My photo-bundle receives the releases and opens, and then shoots off a message that activates the pre-release on your end, giving you the cash. Is a 3rd party necessary here? I don't see it, but then again I could be wrong. -TD _________________________________________________________________ Dont just search. Find. Check out the new MSN Search! http://search.msn.click-url.com/go/onm00200636ave/direct/01/

2 1

Corporate governance goals impossible - RSA
by R.A. Hettinga 05 Nov '04

05 Nov '04

<http://www.theregister.co.uk/2004/11/04/rsa_redux/print.html> The Register Biting the hand that feeds IT The Register ; Business ; Management ; Original URL: http://www.theregister.co.uk/2004/11/04/rsa_redux/ Corporate governance goals impossible - RSA By John Leyden (john.leyden at theregister.co.uk) Published Thursday 4th November 2004 16:43 GMT Companies are struggling to cope with tighter corporate governance regimes, which might even work against the goal of achieving improved IT security they are partly designed to promote. The need to comply with requirements such as data protection, Sarbanes-Oxley, Basel II and other corporate governance reforms is tying up IT managers in red tape, according to a banking security expert. "Recent legislation is having a negative impact on risk management," said Michael Colao, director of Information Management at Dresdner Kleinwort Wasserstein. In some cases, the law has made IT managers legally responsible for adherence to corporate governance rules. Colao says that this may not necessarily be a good thing. "CIOs are now relying on convoluted processes rather than using sound business judgement based on years of experience. A process is easier to defend in court than personal judgement. This means that in many cases unnecessarily cautious decisions are being taken because the CIO is focusing on their own personal liability, rather than what is best for the business," he said.? Different implementations of the European Data Protection Directive in different countries are creating a headache for multinational firms, according to Colao. "This legislation was brought in as part of the EU common market and was supposed to provide clarity and harmony across Europe. Because each country implements legislation in very different ways, the result is a very fragmented and disjointed approach which causes all sorts of problems, particularly for global organisations," he said. Colao made his comments at the Axis Action Forum, a meeting of IT directors sponsored by RSA Security, in Barcelona this week. RSA Security said differences in European legislation highlighted by Colao were a real problem for its clients. Tim Pickard, strategic marketing director at RSA Security EMEA, said: "The nature of implementation of EU directives in member states means that it is almost impossible for today's global CIO to be fully compliant and is therefore likely to be breaking the law in at least one member state." Business managers becoming fed up with FUD In a separate study, more than a third of the 30 delegates to the Axis Action Forum admitted that their Board had never asked for an update on security or implications of security breaches. The finding suggests widespread boardroom indifference to security issues despite the high profile security has been given in the media and by numerous industry initiatives. Firms only take security seriously in the aftermath of attacks, according to one delegate. Part of the reason could be that business managers are becoming inured to alarmist security pitches. Simon Linsley, head of consultancy and development, Philips said: "For years we have had to go to the Board with messages that create the Fear of God. We can no longer rely on these doom and gloom messages - we have to go to the Board with solutions that add value to the business." The Axis Action Forum attended by more than 30 CIOs, IT directors and heads of security from a range of medium to large businesses. . Related stories UK corporate governance bill to cost millions (http://www.theregister.co.uk/2004/09/08/companies_bill_it_costs/) Hackers cost UK.biz billions (http://www.theregister.co.uk/2004/04/28/dti_security_survey/) IT voices drowned in corporate governance rush (http://www.theregister.co.uk/2004/04/22/it_in_corporate_governance/) Big.biz struggles against security threats (http://www.theregister.co.uk/2004/10/27/netsec_security_survey/) ) Copyright 2004 -- ----------------- R. A. Hettinga <mailto: rah(a)ibuc.com> The Internet Bearer Underwriting Corporation <http://www.ibuc.com/> 44 Farquhar Street, Boston, MA 02131 USA "... however it may deserve respect for its usefulness and antiquity, [predicting the end of the world] has not been found agreeable to experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'

1 0

The oldest fraud
by R.A. Hettinga 05 Nov '04

05 Nov '04

<http://www.townhall.com/columnists/thomassowell/printts20041105.shtml> Townhall.com The oldest fraud Thomas Sowell (back to web version) | Send November 5, 2004 Election frauds are nothing new and neither are political frauds in general. The oldest fraud is the belief that the political left is the party of the poor and the downtrodden. The election results in California are only the latest evidence to give the lie to that belief. While the state as a whole went for Kerry, 55 percent versus 44 percent for Bush, the various counties ranged from 71 percent Bush to 83 percent Kerry. The most affluent counties were where Kerry had his strongest support. In Marin County, where the average home price is $750,000, 73 percent of the votes went for Kerry. In Alameda County, where Berkeley is located, it was 74 percent Kerry. San Francisco, with the highest rents of any major city in the country, gave 83 percent of its votes to Kerry. Out where ordinary people live, it was a different story. Thirty-six counties went for Bush versus 22 counties for Kerry, and usually by more balanced vote totals, though Bush went over 70 percent in less fashionable places like Lassen County and Modoc County. If you have never heard of them, there's a reason. It was much the same story on the votes for Proposition 66, which would have limited the "three strikes" law that puts career criminals away for life. Affluent voters living insulated lives in places well removed from high-crime neighborhoods have the luxury of worrying about whether we are not being nice enough to hoodlums, criminals and terrorists. They don't like the "three strikes" law and want it weakened. While most California voters opposed any weakening of that law, a majority of the voters in the affluent and heavily pro-Kerry counties mentioned wanted us to stop being so mean to criminals. This pattern is not confined to California and it is not new. There were limousine liberals before there were limousines. The same pattern applies when you go even further left on the political spectrum, to socialists and communists. The British Labor Party's leader in the heyday of its socialist zealotry was Clement Attlee, who grew up in a large home with servants -- and this was not the only home his family owned. Meanwhile, Margaret Thatcher's family ran a grocery store and lived upstairs over it. While the British Labor Party was affiliated with labor unions, it was the affluent and the intellectuals in the party who had the most left-wing ideologies and the most unrealistic policies. In the years leading up to World War II, the Labor Party was for disarmament while Hitler was arming Germany to the teeth across the Channel. Eventually, it was the labor union component of the party that insisted on some sanity, so that Britain could begin preparing to defend itself militarily -- not a moment too soon. When Karl Marx and Friedrich Engels wrote the Communist Manifesto, they were a couple of spoiled young men from rich families. All their talk about the working class was just talk, but it appealed to other such young men who liked heady talk. As Engels himself put it, when the Communist group for whom the Manifesto was written was choosing delegates, "a working man was proposed for appearances sake, but those who proposed him voted for me." This may have been the first rigged election of the Communist movement but it was certainly not the last. All sorts of modern extremist movements, such as the Weathermen in the United States or the Bader-Meinhof gang in Germany, have attracted a disproportionate number of the affluent in general and the intellectuals in particular. Such people may speak in the name of the downtrodden but they themselves are often people who have time on their hands to nurse their pet notions about the world and their fancies about themselves as leaders of the poor, saviors of the environment or whatever happens to be the Big Deal du jour. Osama bin Laden is not someone embittered by poverty. He is from a very rich family and has had both the time to nurse his resentments of the West and the money to organize terrorists to lash out in the only way that can give them any significance. The belief that liberal, left-wing or extremist movements are for the poor may or may not be the biggest fraud but it is certainly the oldest. -- ----------------- R. A. Hettinga <mailto: rah(a)ibuc.com> The Internet Bearer Underwriting Corporation <http://www.ibuc.com/> 44 Farquhar Street, Boston, MA 02131 USA "Socialism in general has a record of failure so blatant that only an intellectual could ignore or evade it." -- Thomas Sowell

1 0

Blue Democrats Lost Red America
by R.A. Hettinga 05 Nov '04

05 Nov '04

<http://online.wsj.com/article_print/0,,SB109962033700165749,00.html> The Wall Street Journal November 5, 2004 WONDER LAND By DANIEL HENNINGER Blue Democrats Lost Red America Back in 1965 November 5, 2004; Page A12 "And you tell me over, and over, and over again my friend Ah, you don't believe we're on the eve of destruction." --Vietnam War Protest Song, 1965 How did the 2004 election map of the United States come to look like a color-field painting by Barnett Newman? In fact, if you adjust the map's colors for votes by county (as at the Web sites for CNN and USA Today), even the blue states turn mostly red. Pennsylvania is blue, but between blue Philadelphia and Pittsburgh every county in the state is red. California, except for the coastline, is almost entirely red. This didn't happen last Tuesday. The color-coding of the 2004 election began around 1965 in the politics of the Vietnam era. The Democratic Party today is the product of a generational shift that began in those years. The formative years of the northern wing of the Democratic Old Guard go back to World War II. It included political figures like Tip O'Neill, Pat Moynihan and Lane Kirkland. It was men such as these whose experiences, both political and personal, informed and shaped the Democrats before the mid-'60s. Over time the party passed into the hands of a generation, now in their 50s and early 60s, whose broad view of America and its politics was formed as young men and women opposing the Vietnam War. That would include the party's current leading lights -- John Kerry, Howard Dean, Nancy Pelosi. And its most influential strategists, such as Bob Shrum, Mary Beth Cahill and James Carville. The old industrial unions, whose members went over to Ronald Reagan, gave way to the more dependable public-employee unions run by John Sweeney and Gerald McEntee. These Baby Boomers -- the generation of John Kerry, Al Gore and Bill and Hillary Clinton -- transformed the world view of the Democrats, on everything from foreign policy to cultural issues. This new ethos -- instinctively oppositional, aggressively secular -- sank its roots deep on the East and West coasts, but it never really spread into the rest of the country, then or now. Early on, the military became a focus. Democrats belonging to the World War II generation believed that one "served." There was a nonpartisan pact of reverence for the services. After Vietnam, Democratic partisans worked hard, and successfully, to eradicate ROTC from elite, coastal campuses and to adopt an ethos that no longer revered the services, but held them suspect of doing harm. Bill Clinton's relations with the military were strained. John Kerry tried to use his service biography to erase the Vietnam-era legacy of Democratic opposition to things military. It didn't work. Expressed emotion matters greatly for this generation. The most notable phenomenon of the 2004 election was widespread liberal "hatred" of George Bush. Many wondered what sleeping volcano brought this lava to the surface. It came from the style of protest politics born in the 1960s. A famous liberal political phrase then was "the personal is political." Letting oneself become emotionally unhinged during a protest, as at Columbia, Harvard and Berkeley, became a litmus of authenticity. It became the norm, and it still is. But again, only for people who scream themselves blue. Another phrase heard often in the campaign just ended was, "I'm frightened." Admiration for childlike fears in politics received approval in 1970 from Charles Reich's bestseller "The Greening of America," a paean to youth and "a new and liberated individual." Reich's book, by the way, also popularized the notion then that something called the "Corporate State" was blotting out the Aquarian sunshine. This is the mindset that just produced the Democrats' weird obsession with "Halliburton," as if anyone would care beyond the people who were long ago baptized into the blue faith. But the politics of the Vietnam generation wasn't just about Vietnam. It was about changing everything, most notably the culture. This generation really opened up the culture. The old pre-Vietnam strictures on behavior and comportment -- Tip O'Neill's old Boston Catholic world of Mass on Sunday and at least a working if not functioning knowledge of the Baltimore catechism -- got hammered down till the moral landscape became flat and fast. Now you can drive anything at all into theaters, music or movies. This post-Vietnam culture of non-restraint, now almost 40 years old, produced Whoopi Goldberg's double-entendre jokes about George Bush's name at Radio City Music Hall, the Massachusetts Supreme Court's sudden decision on gay marriage, and hard-to-defend support for partial-birth abortion. George Bush, age 58, was a reproach. He personifies everything they have fought since they drove LBJ and Richard Nixon out of politics. And this week they are trying to discover why most of the people who live between the Hudson River and Hollywood Freeway don't agree with them. Expect documentaries soon about Christian evangelicals on the Discovery Channel. There is no hope that the Vietnam generation braintrust who just lost this election will ever understand Red America. Until someone in the party recognizes this, the tides of demography will inexorably erode the blue islands that remain on the map. -- ----------------- R. A. Hettinga <mailto: rah(a)ibuc.com> The Internet Bearer Underwriting Corporation <http://www.ibuc.com/> 44 Farquhar Street, Boston, MA 02131 USA "... however it may deserve respect for its usefulness and antiquity, [predicting the end of the world] has not been found agreeable to experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'

2 1

RE: Your source code, for sale
by Michael_Heyman＠McAfee.com 05 Nov '04

05 Nov '04

> From: owner-cryptography(a)metzdowd.com > [mailto:owner-cryptography@metzdowd.com] On Behalf Of Finney, Hal (CR) > > [SNIP discussion on ripping cash] > > The problem is that if the source code you are purchasing is > bogus, or if the other side doesn't come through, you're > screwed because you've lost the value of the torn cash. The > other side doesn't gain anything by this fraud, but they harm > you, and if they are malicious that might be enough. > Quick fix for seller incentive: the seller rips some amount of their own cash in such a way that they cannot recover it unless the buyer provides the remainder of the buyer's ripped cash. -Michael Heyman

1 0

RE: Your source code, for sale
by hal＠finney.org 05 Nov '04

05 Nov '04

"Tyler Durden" writes: > So my newbie-style question is, is there an eGold that can be verified, but > not accessed, until a 'release' code is sent? > > In other words, say I'm buying some hacker-ed code and pay in egold. I don't > want them to be able to 'cash' the gold until I have the code. Meanwhile, > they will want to see that the gold is at least "there", even if they can't > cash it yet. > > Is there a way to send a 'release' to an eGold (or other) payment? Better > yet, a double simultaneous release feature makes thing even more > interesting. I've been thinking about how to do this kind of thing with ecash. One project I'm hoping to work on next year is a P2P gambling game (like poker or something) using my rpow.net which is a sort of play-money ecash. You'd like to be able to do bets and have some kind of reasonable assurance that the other guy would pay up if he loses. In the case of your problem there is the issue of whether the source code you are buying is legitimate. Only once you have inspected it and satisfied yourself that it will suit your needs would you be willing to pay. But attaining that assurance will require examing the code in such detail that maybe you will decide that you don't need to pay. You could imagine a trusted third party who would inspect the code and certify it, saying "the source code with hash XXX appears to be legitimate Cisco source code". Then they could send you the code bit by bit and incrementally show that it matches the specified hash, using a crypto protocol for gradual release of secrets. You could simultaneously do a gradual release of some payment information in the other direction. If you don't have a TTP, one idea for using ecash is Markus Jakobsson's "Ripping Coins for a Fair Exchange". Basically you withdraw ecash from your account and in effect "rip it in half" and give half to the seller. Now he gives you the product and you give him the other half of the coin. The idea is that once you have given him the "ripped" ecash ("torn" would be a better word because ripping means something else today), you are out the value of the cash. You have no more incentive to cheat, as giving him the other half won't cost you anything additional. (Even without ecash, a service like egold could mimic this functionality. You'd create an escrow account with two passwords, one known to each party. Only with both passwords could data be withdrawn from the account. Then the buyer would transfer funds into this account. After receiving the goods, the buyer would send his password to the seller.) The problem is that if the source code you are purchasing is bogus, or if the other side doesn't come through, you're screwed because you've lost the value of the torn cash. The other side doesn't gain anything by this fraud, but they harm you, and if they are malicious that might be enough. And likewise you might be malicious and harm them by refusing to give them your half of the coin even after you have received the goods. Again, this doesn't benefit you, you're still out the money, but maybe you like causing trouble. Another idea along these lines is gradual payment for gradual release of the goods. You pay 10% of the amount and they give you 10% of the source code. You pay another 10% and you get the next 10% of the source, and so on. (Or it could be nonlinear; maybe they give out half the code for free, but the final 10% requires a large payment.) The idea is that you can sample and make sure they do appear to have the real thing with a fairly small investment. If there is some mechanism for the seller to have a reputation (like Advogato's perhaps, with some spoofing immunity) then the problem is easier; the seller won't want to screw buyers because it hurts his rep. In that case it may be reasonable to ask the buyer to pay in advance, perhaps using the partial payment system just discussed. These various ideas all have tradeoffs, and in general this kind of problem is hard to solve because of the complexity of what constitutes a successful transaction. A reputation system helps a great deal to resolve the issues, but opens up problems of its own. The betting problem I want to work on is relatively easy because there is no ambiguity about who wins, but even then it is hard to make sure that neither party can maliciously harm the other. Hal F.

4 3

Cryptography Research Takes Aim at Content Pirates
by R.A. Hettinga 05 Nov '04

05 Nov '04

<http://biz.yahoo.com/prnews/041105/sff023_1.html?printer=1> Yahoo! Finance Source: Cryptography Research, Inc. Cryptography Research VP Benjamin Jun Takes Aim at Content Pirates Friday November 5, 6:02 am ET Discusses Technology Trends and Responses at Upcoming RSA Conference Europe 2004 SAN FRANCISCO, Nov. 5 /PRNewswire/ -- Despite piracy's high public profile as a threat to intellectual property owners, surprisingly little has been done to understand the range of technical solutions that are feasible, according to security expert Benjamin Jun. With piracy plaguing deployments of pay TV, optical media, console video games and other content, Jun, vice president of engineering at Cryptography Research, Inc., believes content publishers facing these issues have a number of tools and technologies at their disposal to take aim at the pirates, and will discuss solutions and the findings of his recent research on piracy in his seminar on Friday, November 5 at the RSA Conference Europe 2004 being held in Barcelona, Spain. According to Jun, pirates will grow bolder and more effective with advances in CPU processing power, Internet bandwidth and hard drive storage. Although piracy cannot be stopped completely, Jun believes a combination of proactive and reactive security approaches can mitigate the risk and reduce losses to survivable levels. Content publishers facing piracy can apply methods for high-assurance design that anticipate attacks and employ architectures that enable a response after attacks happen. Jun's talk discusses recent piracy trends, describes industry techniques and presents current research in content security. "Although numerous products and technologies have been advertised as solutions to the problem of piracy, most commercial security systems fail catastrophically once an implementation is compromised, making them inappropriate solutions for deployment as part of a major standard, said Jun. "Piracy, like credit card fraud and computer virus security, is a problem that cannot be solved completely, and requires a flexible solution that combines programmable security and 'smart content' with risk management techniques such as forensic marking and attack response capabilities." Proactive security combines tamper resistance with high-assurance design to combat known security vulnerabilities. Reactive systems provide effective tools for responding to piracy after a problem develops. These results are findings of the Cryptography Research Content Security Initiative, a CRI-sponsored, multi-year research effort focusing on understanding and controlling piracy, technology trends in consumer electronics and next-generation applied techniques for high-assurance security. "Content providers must face next-generation pirates by selecting technology that avoids a repeat of painful past lessons," said Carter Laren, senior security architect at Cryptography Research. "We are proud that results from our Content Security Research Initiative are helping leading companies secure their most valuable content." Benjamin Jun's talk, "Piracy: Technology Trends and Responses," part of the Implementers Educational Track at the RSA Conference Europe 2004, will be presented on Friday, November 5, at 11:00 a.m. at the Princesa Sofia Hotel in Barcelona, Spain. Benjamin Jun is a vice president of engineering at Cryptography Research, where he heads the consulting practice and the company's Content Security Research Initiative. He leads engineering groups in the design, evaluation and repair of high-assurance security modules for software, ASIC and embedded systems. Ben holds B.S. and M.S. degrees from Stanford University, where he is a Mayfield Entrepreneurship Fellow. About Cryptography Research, Inc. Cryptography Research, Inc. provides consulting services and technology to solve complex security problems. In addition to security evaluation and applied engineering work, CRI is actively involved in long-term research in areas including tamper resistance, content protection, network security and financial services. The company has a broad portfolio of patents covering countermeasures to differential power analysis and other vulnerabilities, and is committed to helping companies produce secure smart cards and other tamper-resistant devices. Security systems designed by Cryptography Research engineers annually protect more than $60 billion of commerce for wireless, telecommunications, financial, digital television and Internet industries. For additional information or to arrange a consultation with a member of the technical staff, please contact Jen Craft at 415-397-0123, ext. 329 or visit www.cryptography.com. Source: Cryptography Research, Inc. -- ----------------- R. A. Hettinga <mailto: rah(a)ibuc.com> The Internet Bearer Underwriting Corporation <http://www.ibuc.com/> 44 Farquhar Street, Boston, MA 02131 USA "... however it may deserve respect for its usefulness and antiquity, [predicting the end of the world] has not been found agreeable to experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'

2 1

A Gangster With Politics
by R.A. Hettinga 05 Nov '04

05 Nov '04

"A prince is a bandit who doesn't move." --Mancur Olsen Cheers, RAH -------- <http://online.wsj.com/article_print/0,,SB109962052189665752,00.html> The Wall Street Journal November 5, 2004 COMMENTARY A Gangster With Politics By BRET STEPHENS November 5, 2004; Page A12 In 1993, the British National Criminal Intelligence Service commissioned a report on the sources of funding of the Palestine Liberation Organization. For years, it had been Chairman Yasser Arafat's claim that he'd made a fortune in construction as a young engineer in Kuwait in the 1950s, and that it was this seed money, along with a 5% levy on the Palestinian workers in Arab League countries, which kept the PLO solvent. But British investigators took a different view: The PLO, they concluded, maintained sidelines in "extortion, payoffs, illegal arms-dealing, drug trafficking, money laundering and fraud," bringing its estimated fortune to $14 billion. In retrospect, it would seem amazing that 1993 was also the year in which the head of this criminal enterprise would be feted on the White House lawn for agreeing peace with Israel. But then, so much about the 1990s was amazing, which is perhaps why Arafat, of all people, thrived in that time. The ra'is, as he is commonly spoken of among Palestinians, may basically have been a gangster with politics, but he was also one of the 20th century's great political illusionists. He conjured a persona, a cause, and indeed a people virtually ex nihilo, then rallied much of the world to his side. Now that he is dead, or nearly so -- news reports vary as of this writing -- it will be interesting to see what becomes of his legacy. Who was Yasser Arafat? For starters, he was not a native Palestinian, although his parents were and he variously claimed to have been born in Gaza or Jerusalem. In fact, he was born and schooled in Cairo, spoke Arabic with an Egyptian accent, and took no part in the 1948 Arab-Israeli war, the Nakba (catastrophe) which Palestinians regard as their formative national experience. Nor did Arafat take part in the Suez War, again despite later claims to the contrary. But this was the period of Third World ferment -- of the "anti-colonialist" Bandung politics of Indonesia's Sukarno, Algeria's Ben Bela, Cuba's Fidel and Egypt's Nasser -- and at the University of Cairo Arafat became a student activist and head of the Palestine Student Union. He also began developing the Arafat persona -- kaffiyah, uniform, half-beard and later the holstered pistol -- to compensate for his short stature and pudginess. The result, as his astute biographers Judith and Barry Rubin write, "was his embodiment of a combination of roles: fighter, traditional patriarch, and typical Palestinian." Around 1960, Arafat co-founded Fatah, or "conquest," the political movement that would later come to be the dominant faction of the PLO. Aside from its aim to obliterate Israel, the group had no particular political vision: Islamists, nationalists, Communists and pan-Arabists were equally welcome. Instead, the emphasis was on violence: "People aren't attracted to speeches but to bullets," Arafat liked to say. In 1964, Fatah began training guerrillas in Syria and Algeria; in 1965, they launched their first attack within Israel, on a pumping station. But the bomb didn't detonate, and most of the other Fatah raids were also duds. From this experience, Arafat took the lesson to focus on softer targets, like civilians. So began the era of modern terrorism: the 1972 Munich massacre, the 1973 murder of American diplomats in Khartoum, the 1974 massacre of schoolchildren at Ma'alot, and so on. Yet as the atrocities multiplied, Arafat's political star rose. Partly this had to do with European cravenness in the face of the implied threat; partly with the Left's secret love affair with the authentic man of violence. Whatever the case, by 1980 Europe had recognized the PLO, with Arafat as its leader, as the "sole legitimate representative" of the Palestinian people. The U.S. held out for another decade, but eventually it too caved in to international pressure under the first Bush administration. For the Palestinians themselves, however, this was not such a good development. If Arafat's violence against Jews and Israelis was shocking, his violence against fellow Palestinians was still worse. In the manner of other would-be national liberators, he did not look kindly on dissenters within his ranks. In 1987, for instance, Palestinian cartoonist Ali Naji Adhami was murdered on a London street; his crime was to have insinuated in a drawing that the ra'is was having an affair with a married woman. Once in power in Ramallah, the abuses became much worse. Critics of his government were routinely imprisoned and often tortured. In 1999, Muawiya Al-Masri, a member of the Palestinian Legislative Council, gave an interview to a Jordanian newspaper denouncing Arafat's corruption. He was later attacked by a gang of masked men and shot three times. (He survived.) Yet for all this, Arafat continued to ride the wave of international goodwill. The Europeans gave him the Nobel Peace Prize. The Clinton administration saw him as the one man who could "deliver" the Palestinians to make peace with Israel. The peace camp in Israel, championed by the late Yitzhak Rabin and Shimon Peres, more or less agreed: to them, Arafat was the thug who'd keep the Palestinian street quiet. Arafat strung them along, more or less, until his bluff was called by the Israeli peace offer at Camp David in July 2000. After that, there was just no point in keeping up appearances, and so came the intifada. It was a premeditated act. As Arafat had already told an Arab audience in Stockholm in 1996, "We plan to eliminate the State of Israel and establish a purely Palestinian state. We will make life unbearable for Jews by psychological warfare and population explosion . . . . We Palestinians will take over everything, including all of Jerusalem." It goes without saying that Arafat failed in that endeavor. The Israelis belatedly realized that the maximum they could concede was less than the minimum Arafat would accept, and refused to deal with him. For its part, the Bush administration cut off the international life support. In this sense, Arafat's illness -- so far undisclosed by his doctors -- can easily be diagnosed: He died of political starvation. What remains? Very little, I suspect. None of his deputies can possibly fill his shoes, which are those of a personality cult, not a political or national leader. There is nothing to unite Palestinians anymore, either: their loyalties to the cause will surely dissipate in his absence. Arafat was remarkable in that he sustained the illusion he created till the very end. But once the magician walks off the stage, the chimera vanishes. Mr. Stephens, former editor in chief of the Jerusalem Post, is a member of the Journal's editorial board. -- ----------------- R. A. Hettinga <mailto: rah(a)ibuc.com> The Internet Bearer Underwriting Corporation <http://www.ibuc.com/> 44 Farquhar Street, Boston, MA 02131 USA "Camels, fleas, and princes exist everywhere." -- Persian proverb

1 0

Arafat: Where's his money?
by R.A. Hettinga 05 Nov '04

05 Nov '04

<http://www.worldtribune.com/worldtribune/breaking_10.html> Mrs. Arafat keeps husband on life support Where's his money? Special to World Tribune.com GEOSTRATEGY-DIRECT.COMThursday, November 4, 2004 RAMALLAH - Palestinian Authority Chairman Yasser Arafat has died. He was 75 years old. Israeli and Palestinian officials said Arafat died on Thursday in a military hospital in Paris. They said Arafat was deemed clinically dead, but is still attached to life support systems on the insistence of his wife, Suha. Palestinan Authority's Yasser Arafat: Abbas and Qurei sought to acquire his power to allocate money as the PA chairman departed for Paris. But as he boarded a Jordanian Air Force helicopter, Arafat refused. "I'm still alive, thank God, so don't worry," Arafat was quoted as saying. Reuters/Loay Abu Haykel "He is dead, but neither Arafat's wife nor the Palestinian leadership is ready to announce this," a PA official said. "The announcement could take place on Friday." The problem is that Arafat is still the only Palestinian official who can pay the bills. And it is unclear who, if anyone, has access to the estimated $2-3 billion in his personal Swiss bank accounts, according to a report in the current edition of Geostrategy-Direct.com. Even his wife is said to be unaware of how to access the funds. Arafat continues to hold the purse strings to the Palestinian finances. For the last decade, he has been the final, and often only word on payment to everybody from the suicide bomber to the janitor. Not a dime was paid without Arafat's okay. Before he left for Paris, Arafat approved a three-member emergency committee to operate the PA and PLO in his absence. Officials said Ahmed Qurei was meant to run the PA's daily affairs while Mahmoud Abbas was appointed acting chairman of the PLO. Palestine National Council chairman Salim Zaanoun, the third member of the committee, was said to be a symbolic figure. Abbas and Qurei sought to acquire Arafat's power to allocate money during the absence of the PA chairman. But as he boarded a Jordanian Air Force helicopter for Amman, Arafat refused. "I'm still alive, thank God, so don't worry," Arafat was quoted as saying. Israeli officials confirmed that Arafat died on Thursday, Middle East Newsline reported. They said Arafat was termed brain dead and physicians have stopped attending to him. For Palestinians, the main question is where is Arafat's money? Issam Abu Issa knows how Arafat appropriated and concealed money. Abu Issa was the founder and chairman of the Palestine International Bank from 1996 until he fled to Qatar in 2000. "Rather than use donor funds for their intended purposes, Arafat regularly diverted money to his own accounts," Abu Issa said in a report for Middle East Quarterly. "It is amazing that some U.S. officials still see the Palestinian Authority as a partner even after U.S. congressional records revealed authenticated PLO papers signed by Arafat in which he instructed his staff to divert donors' money to projects benefiting himself, his family and his associates." Arafat controls billions of dollars meant for the Palestinian people. In a word, he stole it, intelligence sources said, according to the Geostrategy-Direct report. His personal fortune has been estimated at between $2 and $3 billion, most of it in Swiss bank accounts. In 1997, the PA auditor's office said in its financial report that $326 million, or 43 percent of the annual budget, was "missing." The United States has been supporting former PA security chief Mohammed Dahlan as Arafat's successor. To his friends in the Bush administration, Dahlan, 43, has all the qualities for Arab leadership: a smooth talker and brutal cop. Arafat asked Dahlan to accompany him to Paris in a move designed to keep him out of the Gaza Strip and any coup plot. Another challenger has been Fatah Secretary-general Marwan Barghouti, sentenced to life in prison for a series of terrorist attacks. Barghouti, 44, has followers in the West Bank but does not appear to have the iron will necessary to face Arafat loyalists. Neither Israeli nor PA officials have been told much about Arafat's condition, and the only one authorized to issue information from his hospital bedside is the chairman's wife, Suha. -- ----------------- R. A. Hettinga <mailto: rah(a)ibuc.com> The Internet Bearer Underwriting Corporation <http://www.ibuc.com/> 44 Farquhar Street, Boston, MA 02131 USA "... however it may deserve respect for its usefulness and antiquity, [predicting the end of the world] has not been found agreeable to experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'

1 0

Arafat's Swiss Bank Account
by R.A. Hettinga 05 Nov '04

05 Nov '04

<http://www.meforum.org/article/645> ? - Middle East Quarterly - Fall 2004 FALL 2004 * VOLUME XI: NUMBER 4 Arafat's Swiss Bank Account by Issam Abu Issa Yasir Arafat and the Palestinian Authority are known internationally for the violence between Israelis and Palestinians. As ruinous as that violence has been, another cancer permeates Arafat's administration; its name is corruption. From firsthand experience, I understand just how deep it is. Here is what I know. >From Optimism to Dismay On July 1, 1994, the Palestine Liberation Organization (PLO) chairman, Yasir Arafat, arrived triumphant in the Gaza Strip, watched by millions on television across the world. I was already in Ramallah, having traveled there from my family's exile in Qatar in the weeks after Arafat, Israeli Prime Minister Yitzhak Rabin, and President Bill Clinton had signed the Oslo accords in September 1993. Between 1994 and 1996, I and fellow Palestinian businessmen and intellectuals spent many days brainstorming to see what contributions we could make to a Palestinian state. My family was originally from Haifa, and I hoped to witness an Israeli withdrawal of forces and the birth of a democratic Palestinian state. It was a time of optimism among Palestinians. I gathered with friends and business partners around the television in Ramallah and watched Arafat's arrival in the Gaza Strip. In 1996, I founded the Palestine International Bank (PIB). Thousands of Palestinians in the Palestinian Authority (PA) and the diaspora supported me financially or morally. My investors and I hoped to build a thriving economy in the newly autonomous PA areas. The PIB was truly Palestinian. Headquartered in Ramallah, it used mostly Palestinian capital, although it did receive support from other Arabs. All its reserves were kept inside Palestinian areas, and our shares traded actively on the Palestinian stock exchange. From nothing, we expanded our customer base to more than 15,500. Among those licensed by the newly established Palestine Monetary Authority (PMA), we were the largest bank in the Palestinian territories. I first met Arafat in April 1995 while trying to secure a banking license for the PIB. This meeting at his Gaza office, though brief, was cordial and encouraging. I thought things would go smoothly. But, as the PIB grew more popular, Arafat's inner circle and, specifically, Muhammad Rashid, a PA official, also known as Khalid Salam and often described as an economic advisor to Arafat and manager of a small percentage of PIB stocks, made it difficult for us to branch out and move forward.[1] The PA, which strictly controls Palestinian media, launched a negative media blitz against us in a bid to suppress our growth. The systematic effort to undermine PIB came after I refused to cede power to Muhammad Rashid.[2] Over the course of fifteen meetings, I became better acquainted with Arafat and grew increasingly concerned with his leadership style. Arafat and top PA officials did not respect the rule of law; many were corrupt. Arafat believed neither in separation of powers nor in checks and balances. His animosity toward accountability thwarted efforts to establish a responsible leadership. By 1996, Palestinians in the PA were saying they had traded one occupation for two, the one by Israel and the one by Arafat and his cronies. Rather than use donor funds for their intended purposes, Arafat regularly diverted money to his own accounts. It is amazing that some U.S. officials still see the Palestinian Authority as a partner even after U.S. congressional records revealed authenticated PLO papers signed by Arafat in which he instructed his staff to divert donors' money to projects benefiting himself, his family, and his associates.[3] How did Arafat's inner circle benefit? In 1994, he instructed the Palestinian Authority official in charge of finances, Muhammad Nashashibi, to fund secretly-to the tune of $50,000 per month-a Jerusalem publicity center for Raymonda Tawil, Arafat's mother-in-law, and Ibrahim Qar'in, an associate of Arafat's family.[4] He also ordered the investment in the computer companies of 'Ali and Mazzan Sha'ath, sons of Nabil Sha'ath, the PA's key negotiator in talks with Israel. Amin Haddad, Arafat's designated governor of the Palestine Monetary Authority, established several import-export companies acting as the front man for Arafat. The Palestinian Economic Council for Development and Reconstruction financed these activities.[5] Thus, an organization meant to channel funds from donor countries like France and Germany became a mechanism by which to enrich Arafat. Arafat's men flagrantly displayed corruption. Arriving penniless in Gaza and the West Bank from exile in Tunisia, many PLO members amassed wealth, built villas in Gaza, Ramallah, Amman, and other places, and sent their children to the best schools in the United Kingdom and the United States. Hisham Makki, former head of the Palestine Broadcasting Services, assassinated in January 2001, earned a monthly salary of $1,500 but became a millionaire within a few years. Immediately after his assassination, Arafat froze Makki's personal bank accounts, estimated at $17 million. Makki was alleged to have taken bribes and sold government-owned equipment. However, it was rumored that he had a dispute with another PA official over the sharing of profits gained on illegal business transactions. His assailants, believed to be members of the Al-Aqsa Martyrs' Brigades, a shady group affiliated with Fatah, have never been caught.[6] Palestinians complained. The corruption of Arafat and the Palestinian Authority were blatant, but it appeared as if their status quo policies caused Israel and the United States to turn a blind eye. Diplomats downplayed flagrant corruption. In August 2001, Israel seized close to a half million documents from Palestinian offices in Jerusalem and elsewhere. Subsequent State Department reports on Palestinian governance and terrorism made little use or even mention of these documents.[7] European and U.S. policymakers assumed Arafat's critics to be against the Oslo accord. That may have been the case with members of Hamas and Palestinian Islamic Jihad, but it was not the case among more liberal-minded Palestinians and investors like me. Arafat's corruption reached its peak in 1999 via the monster of "twelve security forces that nobody could control,"[8] in addition to the disorganized Tanzim (Fatah's militia). He played these services off each other, never allowing a subordinate to gain power. Between 1995 and 2000, Arafat's thugs beat up at least eleven elected members of the 88-member Palestinian Legislative Council (PLC) because they voiced views in private and in public that were opposed to Arafat's on how the PA is run. The victims included PLC Human Rights Committee head Qaddoura Fares, Azmi ash-Shoaibi, Abdul Jawad Saleh, Hatem Abdul Kader, among others. Arafat wanted to terrorize and silence his critics. Indeed, one of his favorite slogans was Dimuqratiyat al-Banadiq (Democracy of the Guns). Arafat believes true power lies in force, whether directed against Israelis or against his own people. How popular is Arafat among Palestinians? At times of crisis, television crews show cheering Palestinians demonstrating and greeting their leader outside his Ramallah headquarters. In better days, Palestinian television regularly broadcasts pro-Arafat rallies across the West Bank and Gaza Strip. But rallies aren't always what they seem. PA funds are used to buy loyalty and drum up support.[9] The PA hires crowds, stages promotional media campaigns, and distributes Arafat's pictures in the streets and alleys of the Palestinian territories. Rather than build a viable state, Arafat sought only to amass wealth and power. I myself heard his entourage and close associates refer to him as al-Arrab, meaning "the Godfather." At the end of 1997, when the PA Auditor's Office released its end of the year financial report, $326 million-43 percent of the annual budget-was "missing."[10] Only 57 percent of the budget was accounted for, spent on security forces (35 percent), office of the president (12.5 percent), and public allocation (9.5 percent). A special committee appointed by the PLC conducted an investigation and released a report accusing the PA of financial mismanagement. The findings of this panel exposed many official misgivings and abuses such as the use of government money for personal purposes by ministers Nabil Sha'ath, Talal Sidr, and Yasir Abd Rabboh; excessive expenditure on rent, salaries, and cost of travel in various ministries; receipt of bribes by ministry officials in the Ministry of Civil Affairs; illegal and unreported collection of taxes by the Ministry of Postal Services; granting illegal customs exemptions on cars, furniture, and material donations entering the PA, etc. It concluded that anyone involved in corruption should be taken to court, regardless of his position as minister, undersecretary, or director-general. The report demanded the ouster of at least two ministers: civil affairs minister Jamil at-Tarifi, and planning and international cooperation minister Nabil Sha'ath.[11] The PLC voted 51-1 in favor of dissolving Arafat's appointed 18-member limited self-rule cabinet. Sixteen ministers gave letters to Arafat signaling readiness to resign if asked. But Arafat confirmed the corrupt ministers in their positions rather than firing them. Additionally, PLC member Haider Abdel Shafi resigned due to "frustration with the performance of the PLC and with the executive's total lack of concern for its recommendations," and added, "The PLC is a marginal body and not a true parliament."[12] Even as the PLC committee was conducting its investigation, Arafat appointed Tayeb Abd al-Rahim, general secretary of the Presidential Office, to make a detailed inquiry into acts of corruption. His report remains secret. In practice the reports were meaningless. Since Arafat does not honor rule of law, decisions by auditors or the Palestinian Legislative Council fall by the wayside. Corruption continues. More than six years after the report's issuance, Tarifi remains in the cabinet. Rather than face charges, Sha'ath has won promotion. In another case, Salam Fayyad, the official in charge of finance, again said in August 2003 that there were many "irregularities" in the work of the Petroleum Authority, which has been siphoning money to secret bank accounts for years.[13] When Nablus legislator Mu'awyah al-Masri asked for details and figures about the revenues from oil products, Fayyad shocked the lawmakers by declaring, "Unfortunately, the documents related to the revenues from oil products-or how the money was used-can't be found. They have disappeared from the ministry."[14] The bank accounts of Harbi Sarsour, head of the Petroleum Authority, were frozen by the PA pending investigation into the scandal. But an initial investigation by Fayyad's office and the PLC showed that much of the oil profits had been deposited into a bank account under Arafat's name.[15] For sheer scale, few allegations match up to a deal allegedly struck between Muhammad Rashid, one of Arafat's economic advisors, and the late Yossi Ginosar, a former Israeli security officer. Ginosar's company, ARC, helped open Swiss bank accounts and deposit funds into them derived from both PA-financed companies and Israeli tax rebates to the Palestinian Authority.[16] Over a period of five years, approximately US$900 million was diverted to these accounts.[17] In early 2002, the Palestinian Center for Policy and Survey Research conducted a poll in which they surveyed 1,320 Palestinians. Eighty-five percent believed that there was corruption in PA institutions; only 16 percent gave a positive evaluation to democracy under the Palestinian Authority. Eighty-four percent expressed support for fundamental reforms in the PA.[18] Arafat Robs the Palestine International Bank On November 28, 1999, I became a victim of Arafat's abuse of power and flagrant disregard for the law. That's when, in direct breach of the law, Arafat issued a decree dissolving the Palestine International Bank's board of directors. The state-controlled Palestine Monetary Authority took over the bank, and with Arafat's blessing and written approval,[19] formed a new supervisory board of directors, including at least one convicted and Interpol-wanted felon. The unlawful takeover was a confiscation of my own, my shareholders', and my clients' private assets for Arafat's personal use. At the date of seizure, PIB total assets amounted to $105 million. Since the takeover, they have neither called for a shareholders' meeting nor disclosed the bank's balance sheet. The PLC investigated the seizure of the bank after I lodged a complaint in 2000 about the PIB's unlawful takeover. The PMA governor then threatened the bank's auditing firm, Talal Abu Ghazaleh International (TAGI), for revealing facts and figures that implicated the Palestinian leadership. The PMA governor took punitive measures against them but was unanimously condemned by the PLC.[20] Meanwhile, the PMA altered, hid, or destroyed bank records in their campaign to demonstrate malfeasance on my part retroactively. They supplied false information to the PricewaterhouseCoopers (PWC) group leading to a faulty audit. PWC seems to have taken for granted the accuracy of material that PMA governor Amin Haddad supplied, but he both provided some fraudulent documents and omitted others. The Qatari government, which has remained interested in the case because of my Qatari citizenship, rejected the PWC Report.[21] As they seized the bank, Arafat's security services harassed me. I fled to the Qatari mission in Gaza. Arafat's staff confiscated my private belongings, including my car, which Arafat took for himself.[22] My brother Issa accompanied a Qatari Foreign Ministry delegation to Gaza in order to resolve the stalemate. But, upon his arrival, Palestinian police acting on orders from Arafat arrested him. The PA said they would trade his freedom for mine. Only after the State of Qatar threatened Arafat with financial sanctions and severing of diplomatic ties did the PA give us free passage to leave Gaza for Qatar. In recent months, there has been some movement on my case. After months of investigation and deliberation, the Palestinian Legislative Council ruled all decisions taken by the PMA on the matter of PIB to be illegal, and hence subsequent actions to be illegitimate.[23] Chiefly because of his mismanagement of the PIB case and citing corruption, in May 2004, the PLC fired Amin Haddad from his position in the Palestinian Monetary Authority.[24] Hassan Khreisheh, Palestinian deputy parliament speaker, said, "This is part of the parliament's war against corruption in the PA."[25] He pointed out that Haddad had been pocketing unauthorized bonuses and profiting illegally from his management of the PIB. In spite of this, Arafat continues to back Haddad. As Khreisheh says, "Arafat resists any change, but pressure is building against him."[26] Arafat's support for Haddad is magnified in his August 5, 2004 letter to the PLC Reform Committee. He stated, "Firing the governor of the PMA would serve our enemies."[27] By "enemies," he was referring to, among others, myself and the deputy prime minister of Qatar, Sheikh Hamad bin Jassim bin Jabor ath-Thani, whom he mentioned more than three times before several PLC members. The PLC also indicted Arafat's relative, Jarrar al-Kudwa, who headed the General Monitoring Board that functions as the PA's Controller's Office, for corruption and misleading the investigation into the seizure of the PIB.[28] On June 18, 2004, the evening after the Jordanian daily Ad-Dustur published the Khreisheh interview cited above, Arafat ordered his Special Security Apparatus to arrest one of my sympathizers in Ramallah. Thus does Arafat continue to use the Palestinian security forces to harass and intimidate anyone who questions his pocketbook. It is no surprise then that he issued clear instructions to PA officials not to discuss openly the PIB issue. To him, the matter is an extremely important issue.[29] I have very little faith in the Palestinian judicial system, which is fully under Arafat's thumb. The PA disregards many court decisions unless they serve Arafat's purposes. Chief Justice Zuhair as-Sourani usually acts on Arafat's orders.[30] Arafat and Sourani handpicked Judge Talaat Taweel in order to pass the civil judgment against me in absentia. Taweel has been implicated in criminal cases.[31] Likewise, the PLC's Human Rights Committee condemned Sourani's illegal actions. Earlier, while an attorney general, Sourani issued an arrest warrant against me but failed to produce any legal basis before the PLC; he merely acted on Arafat's verbal instruction.[32] Arafat subsequently promoted him to chief justice. The continuing decay of the judicial system prompted the Union of Palestinian Lawyers to launch a short boycott of the Palestinian court system on June 28, 2004.[33] Union leader Hatem Abbas remains a vocal critical of judicial corruption. On September 26, 2004, he sent a strongly worded letter regarding Sourani's malpractice. And just recently, the PLC decided to suspend all sessions from September 7 to October 7, 2004, in an attempt to pressure Arafat to accelerate the approval of a reform package that he publicly adopted on August 18, 2004, and in protest against the Palestinian cabinet for not implementing the decisions and bills approved by the PLC.[34] The PLC wants to stress that the council's decisions have to be taken seriously. The Cement Scandal Abuse of power among Arafat's associates and Palestinian ministers is not the exception but rather the rule, as shown by the cement scandal: PA officials were accused of selling cement to Israel for use in constructing the West Bank wall and for Israeli construction in the disputed territories, then pocketing the money. On February 11, 2004, Israel's Channel 10 television reported that the Al-Quds Cement Factory supplied the cement for these purposes. Television footage showed cement mixers leaving company headquarters and driving to Maale Adumim, an Israeli settlement a few kilometers away. The family of Prime Minister Ahmad Qureia co-owns the Al-Quds company. When confronted by the allegations at a June 2004 press conference in Rome, Qureia denied personal involvement.[35] On June 9, 2004, the PLC held a debate in which some legislators accused Maher Masri, who held the Palestinian Authority's economy portfolio, of negligence and fraud. Council members called for an investigation on "corruption and tax evasion" charges.[36] Despite the charges, the debate itself was stilted. Palestinian security ejected PLC deputy and anti-corruption campaigner Jawad Saleh from the debate after the PLC speaker prevented nine deputies who had conducted the investigation from participating in the debate.[37] The scandal reportedly started with an Israeli-German businessman named Zeev Blenski. Blenski sought to import 120,000 tons of Egyptian concrete but, the Egyptian firms, under pressure from Egypt's anti-Israel lobby, refused to provide it. Blenski then turned to the Tarifi Ready Mix Cement Company, owned by Civil Affairs Minister Jamil Tarifi and his brother Jamal and two other Palestinian cement companies, Intisar Barakeh Company for General Trade and the Yusef Barakeh Company for General Trade.[38] Tarifi got Masri to sign an import permit. In fact, "senior PA officials had received bribes to issue import licenses to several importers and businessmen working on behalf of Israelis."[39] The permits directed the cement to be used to rebuild homes in the Rafah refugee camp, which had been razed by Israeli troops.[40] Instead, Blenski sold the cement to build parts of the separation fence, as well as new houses in Jewish communities in the West Bank and Gaza.[41] The PLC report concluded that the cement scandal went against PA objectives by indirectly contributing to the separation barrier but also by undermining the Palestinian treasury through the failure to collect tax on the imported cement. Lastly, because the Palestinians still operate under annual cement importation quotas, PA officials' greed undercut the Palestinian construction sector.[42] The PLC passed the report to the district attorney, but no action has yet been taken. Few Palestinians expect that action will be taken. Surprise in New York Pressure for reform is waning, and Palestinian democrats are caught in the middle. On February 13, 2004, I arrived at JFK International Airport in New York on my way to testify about PA corruption before the U.S. House Financial Services Committee. It was not my first trip to Washington; I have been there a half dozen times and have never faced any difficulties. My most recent visit had been a year before when I addressed both the Hudson Institute and The Foundation for the Defense of Democracy on democracy and Palestinian reform.[43] But, this trip was different. Instead of breezing through customs as I had in the past, agents from the Department of Homeland Security's Bureau of Immigration and Customs Enforcement kept me in custody for seventeen hours. At some point, I was cuffed at the wrists and ankles and repeatedly interrogated by agents who accused me of laundering $6 million from the PIB on behalf of the Palestinian Islamic Jihad. They let me go, but I now cannot gain entry to the United States. While dozens of academics signed petitions in support of a visa for Tariq Ramadan, the grandson of the founder of the Muslim Brotherhood, my case generated only silence in American universities.[44] Why the change? PA officials passed the charge to the State Department, which forwarded the information uncritically to Homeland Security.[45] This is ironic since the PIB leadership installed after my ouster was implicated in money laundering for Saddam Hussein.[46] The U.S. embassy in Doha has sought to rectify the matter, and I was allowed to reapply for a new visa; the case is still pending. But splashed across the Arabic press, the message was clear: Foggy Bottom supports Arafat and will turn a blind eye toward the concerns of dissidents.[47] It is counterproductive for Washington to indulge Arafat to the extent that they pull the rug out from anyone trying to make a change. Recent chaos in Gaza reinforces that Washington should not put all its eggs in one basket. But, how can Palestinian administration improve if the U.S. government allows Arafat to use its bureaucracy to do his dirty work? Accountability is key. Conclusion For four years, there has been violence and unmasked hostility between Israeli and Palestinians. Palestinian security forces and Israeli soldiers, who once jointly patrolled the streets of West Bank and Gaza towns, now fight each other. The conflict has taken a heavy toll on human life and on resources, both among Palestinians and Israelis. Israeli authorities and Palestinian organizations estimate the total dead at almost 4,000 and the wounded at more than 32,000.[48] The ailing Palestinian economy has declined 25 percent in 2003[49] while Israel has lost billions of dollars due to recession in the tourism sector and declining investor confidence. When I see cars blown apart by missiles, buses and cafes on the streets of Jerusalem and Tel Aviv destroyed, as well as destruction and death in Gaza and the West Bank, or pictures of grieving mothers and daughters, it is hard to believe that it has been only eleven years since the world celebrated the promise of the Oslo accords. I have problems with Israeli policies in the West Bank and Gaza Strip, but Arafat's leadership for too long has used Israel as an excuse for failure to clean our own house. Arafat's failed leadership is one factor responsible for the evolution of Palestinian extremism and fundamentalism, as well as a culture of death and despair among the Palestinians. While Clinton feted Arafat at the White House as a peace partner, many of us who worked with or lived under Arafat disagreed, seeing him instead as a man exclusively concerned with power, money, and personal gratification. He heads a dictatorial regime staffed by gangsters.[50] I and increasing numbers of Palestinians also blame U.S. and Israeli officials who, in the wake of the Oslo accords, calculated that a Palestinian dictatorship would make a better negotiating partner than a Palestinian democracy.[51] They were very wrong. When growing pressure in the Palestinian territories forced Arafat to find a scapegoat for his political failure, mismanagement, and economic plunder, he turned his guns toward the Israelis. Reform and Arafat are like oil and water. Arafat instigates violence to deflect blame for his own corruption. No amount of dialogue or diplomatic dinners will change this fact. On the positive side, there are still persons who can move the peace-building process ahead. Many Palestinians seek change and welcome democratization and good governance. The Palestinians have the wealth, talent, and skills to carry out major functions for the needed transformation. Young economic leaders could spearhead the process since economic growth and development are fruits of peace. The Palestinian private sector and civil society organizations can be mobilized and empowered in order to foster the democratization process. With the right support, the Palestinians are capable of leading a real transformation towards a democratic state, one characterized by a separation of powers, the rule of law, a free market economy, and a strong civil society. America should not be discouraged by what is going on in the Middle East today. Signs of freedom and reform abound. But, Washington must look forward and not revert to the formulas of the past. Palestinians want not only to be freed from Israeli control but also, as importantly, to end the occupation by Arafat and his cronies. Issam Abu Issa, former chairman of the Palestine International Bank, currently resides in Qatar. He is founder of the Palestinian National Coalition for Democracy and Independence, a Palestinian democratic reform movement. [1] Interview with Palestinian deputy speaker, Ad-Dustur (Amman), June 17, 2004. [2] Lamis Andoni, "Palestine Banking Trouble," Middle East International, Jan. 28, 2000, p. 10. [3] "Scandalous PLO Letters Authenticated by Congressional Task Force," Manfred and Anne Lehmann Foundation (New York), at http://www.manfredlehmann.com/sieg429.html. [4] Ibid. [5] Ibid. [6] Khaled Abu Toameh, "Corrupt Palestinian Officials Said Fleeing in Fear for Their Lives," The Israel Report, Jan./Feb. 2001, at http://www.christianactionforisrael.org/isreport. [7] Matthew Levitt, "PLOCCA 2002: Empty Words," The Washington Institute for Near East Policy, Peacewatch #384, May 24, 2002, at http://www.washingtoninstitute.org/watch/Peacewatch/peacewatch2002/384.htm. [8] Mahmoud Abbas, ex-Palestinian prime minister, quoted in Newsweek, June 21, 2004. [9] Nathan Vardi, "Auditing Arafat," Forbes.com, Mar. 17, 2003, at http://www.forbes.com/global/2003/0317/014.html. [10] The Washington Post, Dec. 2, 1998. [11] PLC Special Committee Report (The Corruption Report,) May 1997, at http://www.jmcc.org/politics/pna/plc/plccorup.htm; Stacey Lakind and Yigal Carmon, "The PA Economy," The Middle East Media Research Institute (MEMRI), Inquiry and Analysis Series, no. 11, Jan. 8, 1999, at http://www.memri.org/bin/opener.cgi?Page=archives&ID=IA1199. [12] Arjan El Fassed, "Cement and Corruption," The Electronic Intifada, June 11, 2004, at http://electronicintifada.net/v2/article2813.shtml. [13] Khaled Abu Aker, "Where Has All the Oil Money Gone?" Arabic Media Internet Network, Aug. 11, 2003, at http://www.amin.org. [14] The Jerusalem Post, Dec. 3, 2003. [15] Ibid. [16] Ma'ariv (Tel Aviv), Dec. 2, 2002, Mar. 7, 2004. [17] Press briefing, International Monetary Fund, Dubai, UAE, Sept. 20, 2003, at http://www.imf.org/external/np/tr/2003/tr030920.htm. [18] The Palestinian Center for Policy and Survey Research, Public Opinion Poll #5, Aug. 18-21, 2002, at http://www.pcpsr.org/survey/polls/2002/p5a.html. [19] Appointment letter signed by Arafat, May 24, 2003, Palestinian Court of First Instance. [20] PLC decision, no. 626/1/8, Oct. 25, 2003. [21] Letter, signed by Muhammad Jeham al-Kuwari, then-director of the Office of the Foreign Minister of Qatar, to the late Yassin Shareef, Palestinian ambassador to the state, Ministry of Foreign Affairs, Qatar, Aug. 30, 2000, at http://www.palestine77.net/kuwari.pdf. [22] Focus Magazine (Munich), Dec. 16, 2002, p. 208. [23] PLC decision, no. 642/1/8, Dec. 30, 2003. [24] Associated Press, May 5, 2004. [25] Ibid. [26] Newsweek International, Aug. 30, 2004. [27] "Report of the Special Reform Committee," PLC, Aug. 25, 2004, p. 6. [28] The Jerusalem Post, Jan. 18, 2004. [29] Tahseen Al Miqati, Palestinian ambassador to Qatar, quoted in Forbes (Arabic edition), May 2004, p. 88. [30] "Position Paper -Re: The Case of Palestine International Bank," Jan. 23, 2004, co-signed by four Palestine-based NGOs: the Mandela Institute for Human Rights, Al-Haq, Al-Quds Human Rights Center, Al-Dustour, at http://www.palestine77.net/ngoenglish.doc. [31] Ad-Dustur, June 17, 2004. [32] "Report of the Human Rights Committee," PLC, Dec. 2, 2003, p. 34. [33] Al-Quds (Jerusalem), June 27, 2004. [34] Palestine Media Center, Sept. 2, 2004, at http://www.palestine-pmc.com/details.asp?cat=1&id=1422. [35] Arjan El Fassed, "Cement and Corruption," The Electronic Intifada, June 11, 2004, at http://electronicintifada.net/v2/article2813.shtml. [36] Rouhi Fatouh, PLC speaker, quoted in The Jerusalem Times, June 18, 2004. [37] The Jerusalem Post, June 21, 2004. [38] The Jewish Tribune (Toronto), June 17, 2004. [39] The Jerusalem Post, June 10, 2004. [40] The Jewish Week (New York), June 25, 2004. [41] Israel National News, June 13, 2004, at http://www.israelnn.com/news.php3?id=63989. [42] The Jerusalem Times, June 17, 2004. [43] Feb. 6, 2003. [44] "Tariq Ramadan: American and European Scholars Respond," Campus-Watch.org, Sept. 23, 2004. [45] Amber Pawlik, "Exporting Freedom," May 9, 2004, at http://www.mensnewsdaily.com/archive/p/pawlik/2004/pawlik050904.htm. [46] The Peninsula (Doha), Apr. 13, 2003. [47] "A Critic of Arafat Is Turned away at the U.S. Border-Reformer Detained at Kennedy Was Headed to Meet Congress," The New York Sun, Feb. 17, 2004; "Standing up to Arafat," The Fox News, Feb. 23, 2004; Adam Daifallah, "Arabs Who Believe in Democracy," The New York Sun, Feb. 23, 2004; "New York Authorities Detain PIB Chairman for 17 Hours at JFK Airport," Ar-Raya (Doha), Feb. 19, 2004; "Story of the Detention of PIB Chairman at the JFK Airport on Allegations of Financing Hamas and Jihad," Al-Hayat (London), Feb. 16, 2004. [48] Casualty updates from Palestinian Red Crescent Society, at http://www.palestinercs.org/crisistables/table_of_figures.htm, and Magen David Adom of Israel, at http://www.magendavidadom.org/casualtyitem.asp?Update=41. [49] Palestine Investment Promotion Agency, at http://www.pipa.gov.ps/economic_indicators.asp. [50] Rafiq an-Natsheh, former PLC speaker, quoted in Asharq (Doha), July 20, 2004. [51] Natan Sharansky, "From Helsinki to Oslo," Journal of International Security Affairs, Summer 2001, at http://www.jinsa.org/articles/articles.html/function/view/categoryid/1383/d…; "Yasser Arafat: An Asset or a Burden. A Confidential Israeli Document," summarized by Mohammed Salah al-Attar, Nida Younis, trans., Ma'ariv, July 6, 2001, at http://www.aljazeerah.info/News%20archives/2004%20News%20archives/Jan/13n/Y…. -- ----------------- R. A. Hettinga <mailto: rah(a)ibuc.com> The Internet Bearer Underwriting Corporation <http://www.ibuc.com/> 44 Farquhar Street, Boston, MA 02131 USA "... however it may deserve respect for its usefulness and antiquity, [predicting the end of the world] has not been found agreeable to experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'

1 0