The effort to build a modern Palestinian state that will live in peace with Israel suffered a great setback last week when pressure from both Fatah and Hamas forced the resignation of the Palestinian Authority prime Minister, Salam Fayyad.
Fayyad, born in 1952 in the northern West Bank, is an economist with a Ph.D. from the University of Texas. He had worked for the IMF as its representative to the PA, and then for Arab Bank, before becoming finance minister in June 2002. The timing was not coincidental: Yasser Arafat was under severe pressure from the United States and other key donors to end the amazing corruption and the support for terrorism that marked his reign. In an April 2002 speech, President George W. Bush had attacked Arafat as a terrorist; two months later he said flatly that "Peace requires a new and different Palestinian leadership." Bush insisted that "a Palestinian state will require a vibrant economy, where honest enterprise is encouraged by honest government." Feeling the pressure, Arafat reacted by asking Fayyad to take on the finance ministry, where he began the immense task of attacking corrupt officials and practices in Arafat's squalid satrapy. Needless to say, this earned him no friends among corrupt Fatah Party and PLO officials who had long gorged on foreign aid funds. Fayyad's whole style was Western, dedicated to efficiency, productivity, and clean government. He put the entire PA budget, hitherto hidden behind clouds of rhetoric and dissimulation, on the Internet.