ESTIMATE - ARAFAT REGIME COULD COLLAPSE BY SUMMER

How ironic history can be. After generations of struggle and such suffering the regime that rules the Palestinians is now in the hands of Ariel Sharon representing Israel, the U.S. Congress representing the financial levers of the American Empire, and the European governments which in this situation operate on the pretense that they are better than either of the above.

Well, in the end Oslo was really all about saving and paying Arafat and friends anyway. They took the money, squirreled it away in various secret bank accounts for themselves, squandered much of the rest. There is no other example of any "liberation movement" is modern history that has stolen and wasted so many billions, not to mention such valuable time itself. For a while even American Jewish organizations were passing the plate for Arafat -- the very same ones who just a short time before were castigating him as a bloodthirsty tyrant!

As we said just the other day: "As for Arafat and Regime...the Palestinian people are saddled with this corrupt, inept, and incompetent regime. They are now paying the price for so many years of corruption, mistakes, and, at best, mediocrity. Unless the Palestinian people can somehow remove Arafat and Regime and replace him and it with some of the far more capable and far more principled Palestinians -- Dr. Haider Abdul Shafi at the top of the list -- they cannot expect things to get better for them. Indeed, far more tragic times might be ahead for the Palestinian people facing the thugs of Sharon and the right-wingers in the U.S. -- even the possibility of another mass expulsion or the forceable conversion of the Hashemite Regime into the Palestinian State."

Meanwhile, though the Americans and Europeans warn otherwise, and though the Arab client-regimes still want Arafat to be among them, the Sharon crowd may well have decided it will be better to encourage Arafat's final demise and let others be blamed.

And these overall realities may also well explain why Arafat and Shaath have been so "gracious" toward Sharon, further diminishing their own credibility, not to mention dignity, among their own people.

U.S. TELLS SHARON: PA FACING FINANCIAL COLLAPSE
By Aluf Benn

[Ha'aretz - 9 February]: The difficult financial situation faced by the Palestinians as a result of the Intifada and Israel's punitive steps heads the list of diplomatic issues for Prime Minister elect-Ariel Sharon. The matter was the center of discussion during Sharon's meeting Friday with American Ambassador to Israel, Martin Indyk, and United Nations Middle East envoy Terje Larsen.

According to sources in Sharon's office, the American government estimates that the Palestinian Authority will collapse within three months if the current situation continues. Larsen also warned that "The PA is about to collapse," and presented data to Sharon on Arafat's depleted accounts that somehow must pay the salaries of about 100,000 public workers on the PA's payroll.

Sharon repeated his opposition to collective punishment, but demanded that the Palestinians end the terrorism and gunfire. Larsen said that Arafat "has lost control," to which Sharon replied, "If Arafat has lost control, then it is even more important that he act quickly. We do not want anarchy."

"I have decided to work to bring peace, but that requires that the other side fulfills its obligations," the prime minister-elect said. "Confidence-building steps must come from both sides."

Indyk delivered a letter to Sharon from U.S. Secretary of State Colin Powell expressing America's tradition of support for Israel's security and the commitment to maintain the country's qualitative military edge in the region. The letter also said that the U.S. strives to continue the peace process in coordination with Israel as well as to develop a system of strategic relations.

Powell wrote that Washington dispatched messages to Arab leaders urging them to restrain themselves and to give Sharon an opportunity to prove his intentions. The letter also related to the U.S. government's concerns about the security situation in the region, especially the spread of non-conventional weapons to Iran and Iraq.