Hamas: A Social Welfare Government or War Machine? Hillel Frisch Ramat Gan 5290002 Israel Mideast Security and Policy Studies No. 116 www.besacenter.org THE BEGIN-SADAT CENTER FOR STRATEGIC STUDIES BAR-ILAN UNIVERSITY Mideast Security and Policy Studies No. 116 Hamas: A Social Welfare Government or War Machine? Hillel Frisch Hamas: A Social Welfare Government or War Machine? Hillel Frisch © The Begin-Sadat Center for Strategic Studies Bar-Ilan University Ramat Gan 5290002 Israel Tel. 972-3-5318959 Fax. 972-3-5359195 offi[email protected] www.besacenter.org ISSN 0793-1042 November 2015 The Begin-Sadat (BESA) Center for Strategic Studies The Begin-Sadat Center for Strategic Studies advances a realist, conservative, and Zionist agenda in the search for security and peace for Israel. It was named in memory of Menachem Begin and Anwar Sadat, whose efforts in pursuing peace lay the cornerstone for conflict resolution in the Middle East. The center conducts policy-relevant research on strategic subjects, particularly as they relate to the national security and foreign policy of Israel and Middle East regional affairs. Mideast Security and Policy Studies serve as a forum for publication or re-publication of research conducted by BESA associates. Publication of a work by BESA signifies that it is deemed worthy of public consideration but does not imply endorsement of the author’s views or conclusions. Colloquia on Strategy and Diplomacy summarize the papers delivered at conferences and seminars held by the Center for the academic, military, official and general publics. In sponsoring these discussions, the BESA Center aims to stimulate public debate on, and consideration of, contending approaches to problems of peace and war in the Middle East. The Policy Memorandum series consists of policy-oriented papers. The content of the publications reflects the views of the authors only. A list of recent BESA Center publications can be found at the end of this booklet. International Advisory Board Founder of the Center and Chairman of the Advisory Board: Dr. Thomas O. Hecht Vice Chairman: Mr. Saul Koschitzky Members: Prof. Moshe Arens, Ms. Marion Hecht, Mr. Robert Hecht, Prof. Riva Heft- Hecht, Hon. Shlomo Hillel, Mr. Joel Koschitzky, Amb. Yitzhak Levanon, Sen. Joseph I. Lieberman, Mr. Robert K. Lifton, Rt. Hon. Brian Mulroney, Mr. Seymour D. Reich, Mr. Greg Rosshandler, Amb. Zalman Shoval, Amb. Norman Spector, Mr. Muzi Wertheim International Academic Advisory Board Prof. Desmond Ball Australian National University, Prof. Ian Beckett University of Kent, Dr. Eliot A. Cohen Johns Hopkins University, Prof. Irwin Cotler McGill University, Prof. Steven R. David Johns Hopkins University, Prof. Yehezkel Dror Hebrew University, Prof. Lawrence Freedman King’s College, Prof. Patrick James University of Southern California, Prof. Robert J. Lieber Georgetown University Research Staff BESA Center Director: Prof. Efraim Inbar Research Associates: Maj. Gen. (res.) Yaacov Amidror, Dr. Efrat Aviv, Dr. Yael Bloch-Elkon, Brig. Gen. (res.) Moni Chorev, Dr. Gil Feiler, Prof. Jonathan Fox, Prof. Hillel Frisch, Prof. Eytan Gilboa, Col. (res.) Aby Har-Even, Eado Hecht, Dr. Tsilla Hershco, Prof. Efraim Karsh, Lt. Col. (res.) Dr. Mordechai Kedar, Prof. Avi Kober, Dr. Alon Levkowitz, Dr. Yaacov Lifshitz, Prof. Ze’ev Maghen, Ambassador Arye Mekel, Col. (res.) Dr. Eran Lerman, Dr. Liad Porat, Mr. Amir Rapaport, Mr. Uzi Rubin, Dr. Jonathan Rynhold, Prof. Shmuel Sandler, Maj. Gen. (ret.) Dr. Emanuel Sakal, Dr. Eitan Shamir, Lt. Col. (res.) Dr. Dany Shoham, Prof. Shlomo Shpiro, Dr. Max Singer, Prof. Joshua Teitelbaum Director of Public Affairs: David M. Weinberg Program Coordinator: Hava Waxman Koen Publication Editor (Hebrew): Alona Briner Rozenman Hamas: A Social Welfare Government or War Machine? Table of Contents EXECUTIVE SUMMARY ................................................................................. 7 INTRODUCTION ........................................................................................... 9 KILLING THE GOOSE THAT LAID THE GOLDEN EGG: HAMAS, GAZAN WORKERS, AND THE ISRAELI LABOR MARKET ..................................................................... 10 TRADE DIVERSION, TUNNEL REVENUE, AND THE HAMAS ROLE IN THE SIEGE OF GAZA ................................................................................................... 15 THE HAMAS STRUCTURE OF GOVERNMENT ........................................................ 18 AN UNACCOUNTABLE GOVERNMENT: HAMAS, THE LEGISLATIVE COUNCIL, AND CIVIL SOCIETY ........................................................................................... 21 RIVALRY AND SYMBIOSIS: THE HAMAS GOVERNMENT AND THE PA .................. 23 EXPENDITURES, WAR-MAKING, AND HUMAN WELFARE .................................... 25 Assessing the Social Costs of Hamas War-making ....................................... 26 THE COST IN HUMAN LIFE .................................................................. 27 ASSESSING THE MATERIAL COSTS OF HAMAS WAR-MAKING ............... 28 ASSESSING THE HAMAS GOVERNMENT’S PERFORMANCE IN OTHER KEY ISSUE- AREAS: ELECTRICITY, WATER AND SEWAGE ................................................... 30 WATER MANAGEMENT ........................................................................ 31 ELECTRICITY ......................................................................................... 32 SEWAGE .............................................................................................. 34 THE HAMAS GOVERNMENT’S FISCAL COLLAPSE, THE UNITY GOVERNMENT, AND WAR-MAKING ................................................................................................. 35 CONCLUSION: INTERNATIONAL AID, MORAL HAZARD, AND HAMAS WAR- MAKING ........................................................................................................... 38 NOTES ............................................................................................................... 40 Hamas: A Social Welfare Government or War Machine? Hillel Frisch EXECUTIVE SUMMARY Hamas is proud of its reputation for dedication to the public welfare of Palestinians, including provision of a variety of social services. Hamas retains this image despite the fact that it has waged three rounds of warfare with Israel over the past seven years. This study evaluates the veracity of Hamas’ claim to concern for Palestinian welfare. It assesses the extent to which the Hamas government has balanced the costs of war-making with the needs of the population it ostensibly serves. It shows that Hamas has failed to engage in true state-building for the general welfare of Palestinians in Gaza, while devoting inordinate resources to building its war machine for conflict with Israel; conflict that visits disaster after disaster upon the population of Gaza. This is a classic case study of the disastrous leadership that has plagued the Palestinian national movement since its inception. Hamas: A Social Welfare Government or War Machine? Hillel Frisch INTRODUCTION Hamas enjoys a reputation for being dedicated to the public welfare of Palestinians and to the needs of Palestinian society, and for providing many social services. It retains this image despite its responsibility for a long list of brutal kidnappings and suicide attacks against Israel, and after waging three rounds of military confrontation in the space of seven years. The following study tries to evaluate the veracity of this claim. It focuses mainly on the Hamas government, which ruled Gaza from June 2007 - after wresting exclusive control from the Fatah-dominated Palestinian Authority - up to the establishment of the unity government in the summer of 2014. The study assesses the extent to which the Hamas government balanced the costs of war-making, which throughout history has always exacted considerable cost in blood and treasure from the population waging it, with the needs of the population it ostensibly served. The study aims to show that the failure to balance between the two- reflected in the disparity between the international community’s assessments of the rehabilitation of Gaza after three rounds of violence, and the funds at the government’s disposal - was the key reason for the collapse of the Hamas government in June 2014, and is an illustration of failed state-building. The Hamas government in Gaza proved to be one more case study in the disastrous leadership that has plagued the Palestinian national movement since its inception. Prof. Hillel Frisch is a professor of political studies and Middle East studies at Bar-Ilan University and a senior research associate at the Begin-Sadat Center for Strategic Studies. 10 HAMAS: A SOCIAL WELFARE GOVERNMENT OR WAR MACHINE? I The study opens with a review of the impact of terrorism on Gazans’ access to the Israeli labor market, which was the source of the relative prosperity Gaza enjoyed between 1970 and the mid-1990s. It then proceeds to look at the structure of government created by Hamas. A third section analyzes the degree of freedom the Hamas government allowed to key civil institutions, such as the Legislative Council (responsible for oversight of government activities) and civil society organizations, which typically demand government accountability. A fourth section focuses on government allocations to public welfare, compared to military and political allocations. The division of labor between the Hamas government and the Palestinian Authority is included within this analysis. The paper then proceeds to assess the costs of war-