Israel: Saturday D-Day for Hamas-led PA

New gov't needs more time, Quartet says.

While Israel and the Quartet agree on the steps Hamas needs to take to earn international acceptance, disagreements have emerged in recent days regarding when the "rules of the game" toward the Palestinian Authority change. While Acting Prime Minister Ehud Olmert said at Sunday's cabinet meeting that the rules would change the minute the new Palestinian Legislative Council was sworn in on Saturday, "D-Day" for the Quartet was not until a Hamas-led government was sworn in. Coincidentally, a new PA government must, under Palestinian law, be formed by March 28 - the day Israel goes to the polls. Olmert's setting Saturday as the critical date means that Israel would most likely not transfer next month's custom and tax revenue - expected to be some $60 million - to the PA. Nevertheless, the Quartet will continue raising money for the PA as long as PA Chairman Mahmoud Abbas remains the head of an interim government. One Western diplomatic official said that, immediately after the PA elections in January, Israel's position had been to take a wait-and-see attitude until the new PA government was formed. The official said it was likely that Olmert moved up the date because of electoral considerations and the sharp criticism he came under last week after deciding to transfer the tax and customs revenues to the PA. Quartet envoy James Wolfensohn just wrapped up a visit to Saudi Arabia, Kuwait, Qatar and the United Arab Emirates for consultations with leaders there on what conditions were necessary for them to contribute money to the PA. He is scheduled to meet in Moscow Wednesday with Russian President Vladimir Putin, who has invited Hamas to Moscow. A spokesman for Wolfensohn denied reports that Wolfensohn was in the Gulf raising money for the PA to make up for the cash shortfall likely to hit it once Israel stopped transferring funds. Rather, he said, Wolfensohn was fulfilling the Quartet's mandate to ensure that the PA did not financially collapse during the period of an interim government. Defense Minister Shaul Mofaz, meanwhile, would neither confirm nor deny a New York Times report Tuesday that Israel and the US were discussing ways to destabilize the Palestinian government so that newly-elected Hamas officials would fail and elections would be called again. The intention, according to the report, was to "starve the Palestinian Authority of money and international connections" so that Abbas would be forced to call new elections in a few months, and so that the Palestinians - unhappy because of new economic hardships - would turn Hamas out of office. "Israel will not allow a terror entity like Hamas turn the Palestinian Authority into a terror entity," Mofaz said in response to the question. Other Israeli and US officials, however, flatly denied the report. A senior official in the Prime Minister's Office said he "knew nothing" about any such plan. Foreign Minister spokesman Mark Regev said, "Israel doesn't make or break Palestinian governments - that is not our job." Likewise, State Department spokesman Sean McCormack said that "there is no plan, there is no plot." White House spokesman Scott McClellan echoed McCormack, denying there was a "plot." According to the Times story, that approach was being discussed at the highest levels of the State Department and the Israeli government, and that Hamas would have to decide whether to give up violence, recognize Israel and accept previous Palestinian-Israeli agreements - the three international preconditions for acceptance - or face isolation and collapse. One Western diplomatic official said, however, that if the aspect of an Israeli-US "plot" were removed from the Times' report, the story dovetailed with Israel and the US's stated policy that financial aid would not be provided to the PA were Hamas to form the government without accepting the three conditions. A blue-ribbon team headed by Prime Minister Ariel Sharon's top adviser Dov Weisglass was expected to present its recommendations on how Israel should deal with the PA to Mofaz on Thursday and to Olmert the following day. The team, which included top officials in the Defense Ministry, Foreign Ministry and security services, has been discussing for a month the ramifications of the Hamas victory and how Israel should respond. Among the issues that are expected to be addressed are whether a new military deployment was necessary to combat a Hamas-led PA, whether Palestinian workers should continue to be allowed into Israel, what services - such as electricity and water - Israel should continue to provide the Palestinian population and what to do with the custom and tax revenues Israel collects on the PA's behalf. National Security Adviser Giora Eiland was also expected in the near future to present to Olmert the policy recommendations of a team he led as well. Olmert reiterated last night that Israel would break ties with the PA once Hamas came into office. "We will not negotiate and we will not deal with a Palestinian Authority that will be dominated wholly or partly by a terrorist organization," Olmert said in a speech in Jerusalem to the Conference of Presidents of Major Jewish Organizations. The day that Abbas appointed a cabinet with Hamas, he continued, "We will review all our contacts with the Palestinian Authority, because once the authority is dominated by a majority of Hamas people it ceases to be the authority that it was." Olmert stressed that Israel "respected" Abbas and that Israel was "prepared to deal with him." But he added, "We will not be able to continue the same pattern of relations if he will choose to surrender to the existence of a terror organization rather than act to disarm it." He reiterated demands that Hamas recognize Israel and renounce violence before any consideration of contacts. The acting PM also took aim at Iranian President Mahmoud Ahmadinejad, saying his efforts to acquire non-conventional weapons must be stopped and warning that Israel could be a top target should they be developed. He described Ahmadinejad as "obsessed with anti-Semitic hatred." Hilary Leila Kreiger contributed to this report.