The NY Times reveals today that the World Bank has written a report describing in economic terms the devastation that a shut-off or reduction of international aid and tax funds will cause to the Palestinian economy:
If Israel withholds revenues from a Hamas-led Palestinian Authority and donor countries reduce aid, the Palestinian areas will be thrown into a deep depression, with personal incomes dropping 30 percent this year alone, according to a new World Bank study.
The study says the Palestinian economy would shrink by 27 percent in 2006 — a one-year contraction that compares to the Depression in the United States. Unemployment would nearly double, to 39.6 percent, and two-thirds of the population would be living below the poverty level.
The report presents several scenarios involving a drop off of donor support but it deemed the most likely one to be:
Israel continues its restrictions and that foreign aid is also reduced.
The consequences of this last assumption are dire even this year. Real gross domestic product per capita would fall 49.4 percent from 1999, before the second intifada began…
In 2007 unemployment would rise to 44.3 percent and the poverty level to 72 percent, the bank estimates, with another 4-point drop in the size of the economy, compared with 1999.
Bringing the Palestinian economy to its knees is not in Israel’s or the world’s interests. But it could happen. Do we really want to see images of Palestinians dying of hunger in the streets of Gaza or Ramallah as Jews did in the Nazi ghettos during the Holocaust? I make this analogy not because Israeli or donor nation policy toward Palestine is like Nazi policies toward the Jews. I make the analogy because images of such suffering will likely increase sympathy for the Palestinians and make them even more of an underdog challenging the behemoths of the world community. That could be a pretty appealing narrative to caring people throughout the world. But why make the Palestinians martyrs to begin with? Why not treat them decently while pressuring them to do the things we want them to do (like accept Israel, etc.)?