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Who Destroyed Palestine?

"How Arafat Destroyed Palestine," the cover headline for David Samuels's article "In a Ruined Country" (September Atlantic), seemed wholly inconsistent with the text. Yes, we learn that Yasir Arafat diverted aid and business money to his private accounts and ran Palestine from "small black notebooks" carried in his vest pocket. But that is hardly unique for Third World potentates, and is particularly understandable in the chaos of modern Palestine—a fragmented, impoverished land of displaced persons. The funds were owned in theory by the Palestinian Authority, but Samuels tells us there really was no Palestinian Authority. Arafat, no organizer, could not assemble an instant government, but in his secondhand clothes and openhanded manner he was able to give hope to a poor and dispirited people. Now Arafat's sequestered $1 billion to $3 billion is being returned from these foreign banks, Samuels reports.

If the question is "Who destroyed Palestine?" a string of more obvious choices leap to mind—Begin, Netanyahu, Sharon, et al., whose rapacious settlement policies have dashed any hope for even a token Palestine.

In the matter of diverted funds, a Bill Moyers piece for PBS last year suggested a poignant similarity between the total cost of the Jewish settlements in Palestine and the hundreds of billions in U.S. aid to Israel. Maybe it is the American taxpayer who unknowingly destroyed Palestine.

James Cox
Missoula, Mont.

It may be a sign of public ignorance, or perhaps failure of the media, that Yasir Arafat's leaving Palestine bereft of principles, administration, and finance is considered news. Certainly the situation was plain long before his unlamented demise. Bill Clinton and Ehud Barak gambled that Arafat was capable of ceasing to be a thug, but alas for his constituency, Abba Eban's witticism that the Palestinian leader never missed an opportunity to miss an opportunity proved true to the very end. The Palestinians needed a Lincoln, wished perversely for a conqueror, and misplaced their faith in a vicious and self-interested Third World kleptocrat.

Yet the thesis that Arafat destroyed Palestine is questionable. Although it is unfashionable to say so, Palestinian society is backward. Why else would Arafat be lionized? It is a society that revels in victimhood, glorifies death and terror, and has been content to remain a backwater and dependency, eschewing reasonable opportunities to seek peace or become productive. The lack of countervailing pressure to construct a genuine civil society during Arafat's undemocratic reign, and the failure of such a society to emerge subsequently, is not a symptom: it is the disease. Arafat is as much a product of his culture as its author. The pessimists are justified.

Andrew J. Green
Overland Park, Kans.

David Samuels's article unfortunately creates an inaccurate impression about key facts regarding Lombard Odier Darier Hentsch & Cie, a private bank based in Geneva, Switzerland. For example, Samuels states that the Palestinian Authority's commitment not to use its funds placed in LODH "for any war or aggression oriented activities" might "have given a more-cautious banker pause." It was LODH, recognizing the sensitivity of the situation, that insisted on this commitment; the bank took on the PA as a client based in part on the positive environment following the Oslo Accords and the deep involvement of two former senior Israeli intelligence officers as financial advisers to the PA. Likewise, contrary to Samuels's statement that LODH "agreed to set up the account on the spot," the process took months. Finally, the article inaccurately states that financial controls over the account were removed in June of 2000.

LODH would like to stress that at all times, from its initial due diligence until the closing of the subject account, it met or exceeded its legal and professional responsibilities. Given the politically sensitive nature of the engagement, LODH took special care in vetting, maintaining, and ultimately terminating the relationship. LODH made tough decisions both to open the relationship in the optimistic period that followed the conclusion of the Oslo agreements and to terminate it during the second intifada. Although the current state of affairs in the Middle East is extremely unfortunate, any suggestion that LODH acted without due diligence is false.

If Samuels had contacted us before finishing his article, it would have afforded us the opportunity to correct these inaccurate statements.

Jérôme Koechlin
Head of Corporate Communications
Lombard Odier Darier Hentsch & Cie
Geneva, Switzerland

W ill David Samuels accept a small correction? Munib al-Masri—now the richest man in Palestine—was employed by Phillips in Algiers and also in Beirut, but he was not "the head of Phillips Petroleum operations in Algeria." My father, who spent his entire career with Phillips and was head of its Egypt operations from 1963 until 1970, says that al-Masri, who would have been twenty-nine in 1963, would have reported to Silvio Èha, who was the man in charge. Whether the promotion was Samuels's error or an exaggeration of al-Masri's, a fact's a fact.

Cynthia Beck Croasdaile
Greenwood Village, Colo.

In his fascinating portrayal of the late Palestinian leader, David Samuels indirectly presents an important question. If it is true, as the "official Palestinian Authority committee" concluded, that 43 percent of the "state budget" was embezzled and only 9.5 percent of it was actually spent on the needs of the Palestinian people, were U.S. and European officials aware of this situation? If so, what did they do in response? If not, why not? Should they be held accountable in some manner?

Ethan S. Burger
Washington College of Law
American University
Washington, D.C.

David Samuels hit the nail on the head. As he notes, Arafat's successor, Mahmoud Abbas, recently built a four-story mansion on land intended to be a public park. Clearly, Arafat's legacy of corruption and dishonesty continues.

Abbas's official television stations continue to broadcast extreme incitement, even as Abbas tells the United States that has stopped. Many of the recent would-be suicide bombers (whose capture goes unreported in the United States) belong not to Hamas but to Fatah, Abbas's own movement. Abbas could easily have pursued the small and violent group Islamic Jihad, but he refused to confront it—let alone the larger Hamas.

On political issues Abbas has stuck to Arafat's hard-line positions. He demands that descendants of Arab refugees be resettled in pre-1967 Israel, not the West Bank (Israel suggested the latter). He rejects the rights of the millions of Mizrahi Jewish Israelis, who are descendants of a similar number of Jewish refugees from Arab lands. In demanding that pre-1967 Israel absorb both Jewish refugees from Arab lands and Arab refugees caused by the Arab wars against Israel, he clearly rejects a two-state solution.

It will take decades to undo the legacy of indoctrination started by Arafat. The steps taken by Abbas so far are not encouraging.

D. Lubinsky
Atlanta, Ga.

David Samuels replies:

The interviews I conducted in Israel and Palestine, and the extensive documentation I have seen, all suggest that Lombard Odier embraced the proposal to accept Arafat's money during an initial meeting with Ozrad Lev in Geneva in early 1997. The "due diligence" that followed that meeting seems to have consisted of a few meetings in Switzerland during which the structure of the account was hashed out and a subsequent trip by the banker Richard de Tscharner to Ramallah (where he was wined and dined by Rachid and was given a model of the al-Aqsa mosque as a gift by Arafat). In a formal letter to Lombard Odier dated June 2000, Rachid instructed the bank to remove the financial controls that Lev had insisted on—including the stipulation that funds from the account could be withdrawn only to a heavily monitored Palestinian Authority account in Ramallah.

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