[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]



 
 THE PALESTINIAN AUTHORITY, ISRAEL AND THE PEACE PROCESS: WHAT'S NEXT?

=======================================================================

                                HEARING

                               BEFORE THE

                            SUBCOMMITTEE ON
                    THE MIDDLE EAST AND NORTH AFRICA

                                 OF THE

                      COMMITTEE ON FOREIGN AFFAIRS
                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED THIRTEENTH CONGRESS

                             SECOND SESSION

                               __________

                              MAY 8, 2014

                               __________

                           Serial No. 113-146

                               __________

        Printed for the use of the Committee on Foreign Affairs


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                      COMMITTEE ON FOREIGN AFFAIRS

                 EDWARD R. ROYCE, California, Chairman
CHRISTOPHER H. SMITH, New Jersey     ELIOT L. ENGEL, New York
ILEANA ROS-LEHTINEN, Florida         ENI F.H. FALEOMAVAEGA, American 
DANA ROHRABACHER, California             Samoa
STEVE CHABOT, Ohio                   BRAD SHERMAN, California
JOE WILSON, South Carolina           GREGORY W. MEEKS, New York
MICHAEL T. McCAUL, Texas             ALBIO SIRES, New Jersey
TED POE, Texas                       GERALD E. CONNOLLY, Virginia
MATT SALMON, Arizona                 THEODORE E. DEUTCH, Florida
TOM MARINO, Pennsylvania             BRIAN HIGGINS, New York
JEFF DUNCAN, South Carolina          KAREN BASS, California
ADAM KINZINGER, Illinois             WILLIAM KEATING, Massachusetts
MO BROOKS, Alabama                   DAVID CICILLINE, Rhode Island
TOM COTTON, Arkansas                 ALAN GRAYSON, Florida
PAUL COOK, California                JUAN VARGAS, California
GEORGE HOLDING, North Carolina       BRADLEY S. SCHNEIDER, Illinois
RANDY K. WEBER SR., Texas            JOSEPH P. KENNEDY III, 
SCOTT PERRY, Pennsylvania                Massachusetts
STEVE STOCKMAN, Texas                AMI BERA, California
RON DeSANTIS, Florida       ALAN S. LOWENTHAL, California
TREY RADEL, Florida--resigned 1/27/  GRACE MENG, New York
    14 deg.                          LOIS FRANKEL, Florida
DOUG COLLINS, Georgia                TULSI GABBARD, Hawaii
MARK MEADOWS, North Carolina         JOAQUIN CASTRO, Texas
TED S. YOHO, Florida
LUKE MESSER, Indiana

     Amy Porter, Chief of Staff      Thomas Sheehy, Staff Director

               Jason Steinbaum, Democratic Staff Director
                                 ------                                

            Subcommittee on the Middle East and North Africa

                 ILEANA ROS-LEHTINEN, Florida, Chairman
STEVE CHABOT, Ohio                   THEODORE E. DEUTCH, Florida
JOE WILSON, South Carolina           GERALD E. CONNOLLY, Virginia
ADAM KINZINGER, Illinois             BRIAN HIGGINS, New York
TOM COTTON, Arkansas                 DAVID CICILLINE, Rhode Island
RANDY K. WEBER SR., Texas            ALAN GRAYSON, Florida
RON DeSANTIS, Florida       JUAN VARGAS, California
TREY RADEL, Florida--resigned 1/27/  BRADLEY S. SCHNEIDER, Illinois
    14 deg.                          JOSEPH P. KENNEDY III, 
DOUG COLLINS, Georgia                    Massachusetts
MARK MEADOWS, North Carolina         GRACE MENG, New York
TED S. YOHO, Florida                 LOIS FRANKEL, Florida
LUKE MESSER, Indiana


                            C O N T E N T S

                              ----------                              
                                                                   Page

                               WITNESSES

Jonathan Schanzer, Ph.D., vice president for research, Foundation 
  for Defense of Democracies.....................................    10
Mr. James Prince, co-founder and president, The Democracy Council    25
The Honorable Robert Wexler, president, S. Daniel Abraham Center 
  for Middle East Peace (former Member of Congress)..............    38

          LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING

Jonathan Schanzer, Ph.D.: Prepared statement.....................    13
Mr. James Prince: Prepared statement.............................    28
The Honorable Robert Wexler: Prepared statement..................    40

                                APPENDIX

Hearing notice...................................................    64
Hearing minutes..................................................    65
The Honorable Gerald E. Connolly, a Representative in Congress 
  from the Commonwealth of Virginia: Prepared statement..........    67


 THE PALESTINIAN AUTHORITY, ISRAEL AND THE PEACE PROCESS: WHAT'S NEXT?

                              ----------                              


                         THURSDAY, MAY 8, 2014

                     House of Representatives,    

           Subcommittee on the Middle East and North Africa,

                     Committee on Foreign Affairs,

                            Washington, DC.

    The subcommittee met, pursuant to notice, at 1:47 p.m., in 
room 2172, Rayburn House Office Building, Hon. Ileana Ros-
Lehtinen (chairman of the subcommittee) presiding.
    Ms. Ros-Lehtinen. The subcommittee will come to order.
    After recognizing myself and Ranking Member Deutch for 5 
minutes each for our opening statements, I will then recognize 
other members seeking recognition for 1 minute. We will then 
hear from our witnesses.
    And, without objection, the witnesses' prepared statements 
will be made a part of the record and members may have 5 days 
to insert statements and questions for the record, subject to 
the length limitation in the rules.
    The Chair now recognizes herself for 5 minutes.
    Last July, Secretary Kerry, together with negotiators from 
Israel and the Palestinian Liberation Organization, PLO, 
announced that the Israeli-Palestinian peace negotiations had 
restarted.
    Here we are now, 9 months later, and what do we have? We 
have a peace process that fell apart, yielding no positive 
results, leaving both parties with an even greater distrust of 
one another.
    In fact, the legacy of this failed round of talks could be 
that it ended up causing more harm than good, as it seemed to 
have moved Fatah and Hamas closer to reconciliation while Abu 
Mazen continues his push for de facto recognition at the U.N., 
both of which will have serious repercussions for U.S. policy 
toward the Palestinians.
    There are laws on the books that prohibit U.S. assistance 
to any U.N. Agency that accepts a nonexisting state of 
Palestine amongst its ranks. And though the administration 
continues to seek a waiver in order to give the funding, I will 
continue to do everything in my power to ensure that it does 
not get this authority.
    And then there is the Palestinian Anti-Terror Act, a bill 
that I authored that eventually became law that prohibits U.S. 
assistance to a Palestinian Government that would have Hamas--
any members of Hamas amongst its ranks.
    Should reconciliation happen and Hamas become a part of the 
Palestinian Government, I fully expect Secretary Kerry and the 
administration to enforce the letter of the law.
    I don't doubt Secretary Kerry's earnestness in wanting a 
mutually beneficial deal between the parties. I share that 
earnestness. I don't think anyone in this subcommittee would 
disagree.
    But from the beginning, I questioned the prioritization of 
this endeavor in light of so many other pressing matters in the 
Middle East and the North African region. To say that this task 
was one better suited for Sisyphus would be an understatement, 
forever pulling that rock up the hill.
    Secretary Kerry's faith that Abu Mazen and the PLO could 
sit down with Israel this time and somehow come to the table 
with a new-found desire to actually achieve peace with Israel 
was misplaced.
    The P.A. and Abu Mazen have shown time and time again that 
it is a corrupt entity, incapable of governing the territories, 
unwilling to see a two-state solution in which two Nations 
could exist side by side in peace.
    And so one has to question the amount of time, effort, and 
resources spent chasing the unobtainable, at least under the 
present conditions, when there is one of the worst humanitarian 
disasters in recent history occurring in Syria, transition to 
democracy impediments in Egypt, and Iran continues its support 
for terrorism worldwide and its nuclear ambition have not 
waned.
    Over 150,000 people in Syria have been killed while 
millions have fled to neighboring countries or have been 
internally displaced, and the administration's policies, 
undefined and indecisive, have failed to adequately address 
this issue.
    According to the State Department's recently released 
global terrorism report, Al Qaeda and its affiliates are on the 
rise and becoming more aggressive in places like Iraq, Syria, 
Yemen, and North Africa.
    Iran continues to be the world's foremost state sponsor of 
terrorism, actively targeting Israeli and U.S. interests, 
increasing its presence in our own hemisphere and Africa, and, 
of course, it is still propping up the Assad regime in Syria, 
all of this while the administration continues to negotiate 
with the regime in Tehran over its nuclear ambitions, even 
though State's own assessment is that Iran continues to refuse 
to prove its nuclear program is indeed for peaceful purposes.
    And these are just a few of the fires that need to be put 
out in the Middle East and North Africa region. Yet, the failed 
peace talks have managed to fan the flames.
    The signed reconciliation agreement between Fatah and Hamas 
signifies that Abu Mazen is more interested in making peace 
with terrorists than it is with Israel, but it reveals who Abu 
Mazen really is. He is a man who has never been a true partner 
for peace, but, rather, an obstacle toward peace.
    Abu Mazen is a man more interested in taking U.S. taxpayer 
money and using it to pay salaries of convicted Palestinian 
terrorists with Israeli and American blood on their hands than 
he is in running an effective government that could lay the 
foundation for an independent state.
    Abu Mazen is a man who is corrupt and uses cronyism to 
maintain his position as the head of the PLO and the P.A. and 
fears losing that control and, thus, will never make the hard 
decisions for the benefit of the Palestinian people at his 
expense.
    This hearing is important to understand how and why this 
latest attempt at peace between Israelis and Palestinians 
failed and allows us to take a closer look at the real 
obstacles to peace in order to better formulate U.S. policies 
as it relates to the P.A.
    And I am now very pleased to yield to my ranking member and 
good friend, Mr. Deutch of Florida.
    Mr. Deutch. Thank you, Madam Chairman.
    Thanks to our witnesses for being here today.
    It is a special honor for me to welcome Congressman and 
former chairman of the Europe Subcommittee, Robert Wexler, back 
to this committee. I will have more to say about him in a 
couple of minutes.
    Earlier this week marked Yom Ha'atzmaut, the 66th 
anniversary of the independence of the State of Israel. Since 
her independence in 1948, Israel has defended herself on every 
single one of her borders.
    Despite facing continued, even existential, security 
threats, Israel has become a vibrant democracy, one that, 
unlike so many of Israel's neighbors, respects human rights and 
religious minorities, all while an innovative, high-tech 
economy flourishes.
    We must acknowledge that the Palestinian Authority under 
President Abbas has made tremendous strides in working to build 
state institutions and establish security forces that have 
dramatically reduced violence in the West Bank. The United 
States Congress has committed a great deal of resources to 
strengthening the Palestinian Authority, to the tune of $400 
million per year.
    At the outset of peace talks last August, Secretary Kerry 
worked with the international community on a $4-billion 
economic package that would help jump-start the Palestinian 
economy, because we all know that a stable state starts with a 
strong, thriving economy that provides greater opportunity and 
prosperity for the Palestinian people.
    For the past 9 months, the world watched as Secretary of 
State Kerry and his team worked feverishly to restart direct 
negotiations between Israel and the Palestinians.
    Now the April 29th deadline has come and gone without any 
agreed-upon framework or extension of talks, which leads to the 
obvious question: What happens next? What role should the 
United States play going forward? And what are the consequences 
if Fatah reconciles with Hamas?
    We hope to see progress in the talks. We hope to see two 
States or two peoples arising out of direct negotiations and 
without the imposition of any third-party plans.
    But we cannot expect Israel to continue to negotiate with a 
partner who has chosen to reconcile with a terrorist 
organization that refuses even to recognize Israel's right to 
exist, one that targets innocent Israeli civilians with rockets 
and suicide attacks.
    President Abbas claims that any interim government will 
abide by the same principles the PLO adheres to, which have 
been stipulated by the international community: Renouncement of 
violence, recognition of Israel's right to exist, and the 
acceptance of all previous diplomatic agreements.
    Let's be clear. Israel will not negotiate with any 
Palestinian Government that is backed by Hamas terrorists and 
refuses to accept the Quartet Principles.
    Any government that includes Hamas terrorists will not 
receive U.S. assistance. The law is clear. And this Congress 
will not allow U.S. Funding to flow to any government that 
includes terrorist members of Hamas.
    I hope this message has been received in Ramallah because, 
like so many of my colleagues here, I believe in U.S. 
assistance to the Palestinians.
    If we want to see a thriving, stable state for all 
Palestinians, economic support and foreign investment is the 
best way to promote peace and stability.
    Why would President Abbas jeopardize the world's support by 
partnering with terrorists? It is easy to sit back and say we 
have seen this before. As we know, there have been similar 
failed reconciliation attempts in 2007, 2011, 2012.
    But the damage the Palestinians do in trying to unify with 
a terrorist group is that the Palestinians aren't using their 
time to build their institutions and to prepare their people 
for peace and for the recognition of the State of Israel.
    Aid dollars are needed for all of those things, whether it 
is for security, institution-building, education, or economic 
growth.
    So the bigger question is: What is Abbas doing to really 
make a Palestinian state viable? What is he doing to make a 
Palestinian state that can be stable?
    Instead of unifying with a terrorist organization, why not 
take a very positive and concrete step? Condemn violent acts of 
incitement.
    He can also prevent incitement and prepare for peace by 
taking a small, but very significant, step: Put Israel on the 
map, his map. Official Palestinian Government maps must show 
Israel.
    That will communicate to the Palestinian people that Israel 
is here to stay and that those who envision a Palestinian 
state, as they put it, from the river to the sea, whether they 
are members of Hamas or whether they are anti-Israel members of 
BDS groups, do not support a two-state solution, a Jewish and a 
Palestinian state. By changing the maps, President Abbas can 
show that he is committed to peace even while they are not.
    Now, we know the only path to a peaceful two-state solution 
is through negotiations between both parties. Unilateral 
actions will never achieve this goal. I hope that there is 
still space for negotiations to continue without this unity 
deal.
    And so, as Abbas stands at this very critical juncture, I 
urge him to choose the real partner in peace.
    And I yield back.
    Ms. Ros-Lehtinen. Thank you very much for that opening 
statement.
    I now would like to yield to our members for their opening 
statement.
    And we will start with Mr. Chabot, subcommittee chairman. 
Thank you.
    Mr. Chabot. Thank you very much, Madam Chair.
    Unfortunately, I have another hearing that I have to attend 
here shortly. So I will read the testimony of all the panel 
members here following the hearing.
    But I did want to come over to personally recognize and 
acknowledge the presence of our former colleague, Congressman 
Wexler, who served this institution so honorably for so many 
years.
    And we actually served not only on Foreign Affairs 
Committee together, but, also, Judiciary Committee, and we 
participated in such things as the impeachment of a President. 
We were on opposite sides on that one.
    Mr. Wexler. On everything.
    Mr. Chabot. Well, on everything. I stand corrected.
    Although we were two of the co-founders of the 
Congressional Taiwan caucus. So we generally agreed on issues 
with respect to Taiwan.
    And I remember a number of codels that we were involved in 
and did, I believe, good work in various parts of the world.
    We went to The Hague together when Israel was under such 
attack around the world for trying to defend itself in building 
a security fence in some areas, walled in other areas. And they 
were getting much criticism, and we were there speaking out on 
their behalf.
    I remember meeting with President Mubarak in his office 
when he was still in power in Egypt, and we were urging him to 
hold free and open and fair elections. And perhaps, had he 
followed our advice back there, he would find himself under 
different circumstances today.
    But, in any event, I appreciated his service to this 
institution, and we appreciate his good work on behalf of this 
Nation at this point in his capacity.
    And we welcome you back.
    And thank you, Madam Chair. I yield back.
    Ms. Ros-Lehtinen. Thank you so much, Mr. Chabot.
    Mr. Higgins of New York is recognized.
    Mr. Higgins. Thank you, Madam Chair.
    I just wanted to also welcome the panelists here. And just 
to take this in a little bit different direction, if you look 
at public polling, both the Palestinians and the Israelis in 
equal numbers, 70, 80 percent, believe in a two-state solution.
    But, at the same time, by those same percentages, they 
don't think that a two-state solution is possible; so, what you 
have is a context of disbelief.
    And, you know, unilateralism, one side taking a move, 
doesn't move us closer to any kind of solution. What you need 
is mutual steps here.
    What could the Israelis do to demonstrate to the 
Palestinians that they believe that the West Bank, or most of 
it, should be part of their state? Well, don't build outside of 
the blocks.
    You know, the blocks represent about 8 percent of the West 
Bank. You would be saying to the Palestinians, ``We are only 
going to build in the area that we think should be our state, 
not the area that should be your state.''
    If a parallel move is made on the Palestinian side, what 
could the Palestinians do? As my colleague Ted Deutch had said, 
put Israel on a map.
    You know, if you ask the Palestinian leaders why Israel 
isn't on a map, they say they don't know what the borders are. 
Well, you know what they want them to be.
    So, you know, there is no Web site, there is no textbook, 
that talks about, you know, the existence of Israel in a two-
state scenario.
    The other is, as Ted also said, stop the incitement, you 
know, stop treating Palestinians that kill Israelis as martyrs. 
This creates a cycle of violence that transcends generations.
    You know, in my tradition, in the peace process in Northern 
Ireland, you know, both sides that had committed themselves for 
30 years to violence, on the Catholic side and the Protestant 
side--before they were admitted to the negotiating table, both 
sides had to renounce violence. Both sides had to participate 
in the destruction of their arms to demonstrate that they were 
truly committed to a peaceful coexistence.
    And I think what we have to accept here is that you can do 
all kinds of negotiations. You can try to bring the leaders 
together to push them in a direction that they don't want to 
be. But a settlement to this long-standing issue has to come 
from within. It is not going to come from without.
    And, you know, the two sides--you know, the United States 
can push Israel, push the Palestinians, together, but both have 
to come to the conclusion that, you know, their disdain for 
each other historically is not nearly as important as their 
love for their own children and the future of a two-state 
solution between the Palestinians and the Israelis.
    With that, I will yield back.
    Ms. Ros-Lehtinen. Thank you very much.
    And if the subcommittee would indulge me for just a minute, 
Mr. Rohrabacher, I am going to turn to Mr. Deutch, who is going 
to say--I would like for him to say a few words about Mr. 
Wexler. And I know you have some other commitments.
    And I do as well, but I know that Mr. DeSantis is going to 
take over for me. We have got a meeting with the Syrian 
opposition group.
    So Mr. Deutch is recognized, Mr. DeSantis and then----
    Mr. Deutch. I am sorry that we both need to head off to 
other commitments. And, as our witnesses know, we will pay 
close attention to the testimony today both as you deliver it 
and written.
    I just wanted to take a moment to welcome my friend and my 
former congressman, Robert Wexler, back to this committee on 
which he so ably served for so many years.
    It is Congressman Wexler's commitment to these issues, his 
expertise about these issues, his deep passion not just for 
what happens in Washington, but for the constituents that he 
represented that I now have the good fortune to represent--it 
is all of these things that made him a tremendous Member of 
this body.
    And the way that he forged relationships with members on 
both sides of the aisle, as we have already seen here today, is 
a high bar that he set that I have spent the past number of 
years trying to reach.
    So it is wonderful to have you have here. You are doing 
great work, Robert, in your current capacity at the S. Daniel 
Abraham Center. I wanted to thank you for all that you have 
done while you were here, all the great work that you continue 
to do. It is an honor for us to have you here.
    And I also wanted to acknowledge Danny Abraham, who is also 
here, who is a World War II veteran, a great American 
entrepreneur, and someone who has dedicated so much of his life 
to making peace as well.
    Robert, it is a pleasure to welcome you back.
    Danny, it is a pleasure to welcome you to the committee.
    And, Mr. Chairman, I will yield back to you.
    Mr. DeSantis [presiding]. Thank the gentleman.
    The gentleman from California, Mr. Rohrabacher, recognized.
    Mr. Rohrabacher. Yes. I would like to associate myself with 
the remarks that were just given us about our former colleague 
and friend.
    I have been following this, as many Americans have, the 
possibility of having peace in the Middle East for, well, 
almost my whole life now. I was born in 1947, and I guess 
Israel was born in 1948.
    I do not believe that this is a problem where--at least it 
isn't anymore--where you have two sides that are unwilling to 
try to reach out to one another.
    What we have is Israel in the last 20 years has given up 
territory, has reached out, has, in fact, given up the West 
Bank and has permitted a total of the Gaza Strip to go under 
the jurisdiction of the Palestinians.
    And I see that, in the last 20 years, 30 years, we have 
seen Israel give up a lot and I haven't seen the Palestinians 
give up anything. What have they given up in the last 20 years?
    The only thing that stands today between peace in the 
Middle East, as far as I can see--and I will be anxious to hear 
your reaction to this--the only real thing that stands between 
peace is a Palestinian willingness to say, ``We don't have the 
right to return to the pre-1967 borders. Thus, we do recognize 
Israel has a right to exist as a separate state and we will 
have the two-state solution.''
    But every time I ask a Palestinian--and I have lots of 
Palestinian friends--``Well, that means that you agree that 
this right of return doesn't exist. Because if you say the 
right of return, you are saying Israel doesn't have a right to 
exist as an Israeli--as a Jewish state. Right?''
    And so they never will say that. To me, that is the only 
thing that is a roadblock. The Israelis have already made 
concessions. What concessions have the Palestinians made? They 
are not even willing to make that.
    I am for peace. I really am. I am not--I don't think of 
myself as someone in favor of Israel over the Palestinians. No. 
They are both groups of people who deserve to have their own 
country and deserve to live in peace.
    But I would hope that, as we go through the testimony 
today, that we get to the heart of the matter. And I believe 
that that is the heart of the matter: The Palestinians have to 
agree that Israel will be able to exist and they haven't 
honestly done that yet.
    Please feel free to contradict that in your testimony.
    Mr. DeSantis. The gentleman's time has expired.
    The Chair now recognizes the gentleman from Illinois, Mr. 
Schneider.
    Mr. Schneider. Thank you, Mr. Chair.
    As we will soon hear from our witnesses, Secretary of State 
Kerry's efforts to broker a peace agreement between the 
Israelis and Palestinians took place in the context of great 
regional turmoil. History will determine whether or not the 
efforts were worth the effort.
    Our challenge in the present, however, is to assess what 
policies we can pursue now that will help move the prospects 
for peace forward and, perhaps, more immediate, what policies 
will help ensure that the region is not moved backwards.
    Much has been said lately of the decisions Israel must 
consider, particularly regarding borders, the security 
arrangements in the Jordan Valley, and prisoner releases. I 
believe the focus is my outlook.
    Dr. Schanzer, I hope you will take the time today to 
elaborate on your prepared testimony on the need for 
Palestinians to focus, in your words, on good governance, 
economic reform, and institution-building.
    Finally, I would like to touch briefly on the recent 
comments of Secretary Kerry and his reference to the specter of 
apartheid relative to the conflict.
    As the Secretary later noted, he wished he would have used 
a different word. I appreciate his quick retraction and his 
candor.
    While Israel, like any society, is not perfect, one need 
only look at the Arab members of the Knesset, or Salim Joubran, 
an Arab-Israeli judge sitting on the Supreme Court, to know 
that the term ``apartheid'' does not apply here.
    The State of Israel grants full rights and security to its 
Arab citizens living within Israel. Full enfranchisement, full 
employment, full housing, and full participation in the 
political process are a staple of Israeli democracy.
    But, more important, though unintended, the use of the word 
``apartheid'' gives support to those who seek to delegitimize 
Israel and those who promote divestment and sanctions against 
Israel. I hope that we can count on the Secretary and others to 
avoid such linkage in the future.
    I look forward to hearing more from our witnesses.
    And I yield back the balance of my time.
    Mr. DeSantis. Gentleman yields back.
    The Chair recognizes himself for 1 minute.
    I want to thank the witnesses for coming. This is a very 
important issue and near and dear to many of our hearts.
    It seems to me, especially with the unity government now 
with Hamas and Fatah, that the single biggest obstacle--and I 
will echo my colleague from California--to having a peace in 
this region has been a refusal to the Arabs in the region to 
recognize Israel as a Jewish state.
    There have been multiple opportunities where you could have 
had a Palestinian state. The original U.N. Partition plan in 
the late 1940s, that was way more generous to the Arab 
population than to the Israelis. The Israelis accepted it. The 
Arabs fought it.
    And, of course, we have had multiple conflicts since then. 
There have been multiple opportunities for there to be a true 
two-state solution where Israel is existing as a Jewish state.
    And so, until that changes, I don't see how we are going to 
be able to have a resolution of this in a way that benefits 
Israel's security, and I do not think that we can continue in 
good faith to be sending U.S. taxpayer dollars over to the 
Palestinians if they are allied with Hamas.
    I mean, Hamas--forget about recognizing Israel. I mean, 
they want to destroy Israel. They are not even bashful about 
their support of terrorism. And so I don't see how this is 
something that could be viewed as a positive step.
    And I think we need to act in the Congress--good behavior 
can be rewarded, but I think you got to penalize bad behavior.
    And I will now recognize the gentleman from Massachusetts, 
Mr. Kennedy.
    Mr. Kennedy. Thank you, Mr. Chairman. Thank you to the 
chairman and ranking member of the committee for calling an 
important hearing.
    To our witnesses, thank you very much.
    And to Congressman Wexler, it is great to see you again. 
Thank you for being here.
    Gentlemen, I will be brief. I think my colleagues have 
framed the debate about as well as you possibly can. Just to 
add my voice to it, I look forward to your testimony. I look 
forward to the opportunity for us to ask you some questions.
    I myself am particularly interested, to the extent that you 
can speculate, as to Abbas's decision as--to approach Hamas and 
the decision to reconcile, what the--prospects for a true 
reconciliation there actually are and what that means in the 
immediate term as that process continues to unfold for U.S. 
policy in the region.
    So thank you very much again and look forward for your 
testimony.
    Mr. DeSantis. Gentleman yields back. And the Chair will now 
recognize the gentleman from California, Mr. Vargas.
    Mr. Vargas. Thank you very much, Mr. Chairman. I appreciate 
the opportunity.
    I, too, would like to welcome the witnesses.
    What I would say is that Israel has done more than any 
nation should have to do to try to achieve peace. They have 
given up their land. They have released terrorists. They have 
done everything they could to try to achieve peace, and the 
Palestinians have done nothing.
    One thing I would correct for the record, I think it says 
Israel was born in 1948. That is modern Israel. Remember, 
Israel has been around since, you know, 1200 B.C. So Israel has 
been around for a very, very long time. Hope we recall that.
    Again, I look forward to the testimony. Thank you.
    Mr. DeSantis. Want to thank the gentleman.
    So I am pleased now to welcome our witnesses. Thank you for 
coming. Welcome back.
    First, Dr. Jonathan Schanzer is vice president of research 
for the Foundation of Defense of Democracies. Prior to this, 
Dr. Schanzer served as a counterterrorism analyst at the U.S. 
Department of Treasury, where he took part in designating 
numerous terrorism financiers. So welcome.
    We also have with us Mr. James Prince, who is co-founder 
and president of the Democracy Council. Prior to this, Mr. 
Prince was at PricewaterhouseCoopers, where he was engaged in 
the Middle East, including through an investigation of 
corruption at the Palestine Investment Bank.
    Mr. Prince was also a senior professional staff member for 
this committee and helped to establish a Public Policy 
Institute at a university in northern Iraq.
    Welcome, Mr. Prince.
    And last, but certainly not least, we welcome back Mr. 
Robert Wexler, a former member of the Florida delegation, who 
is now president of the S. Daniel Abraham Center for Middle 
East Peace.
    During his time in Congress and now at the center, Mr. 
Wexler has traveled extensively in the Middle East and was also 
chair of the Subcommittee on Europe of the House Foreign 
Affairs Committee and served on the Middle East Subcommittee as 
well.
    So, welcome, Congressman Wexler.
    Mr. DeSantis. At this point, I will recognize Dr. Schanzer. 
You guys have 5 minutes for opening statements.
    And you may begin.

   STATEMENT OF JONATHAN SCHANZER, PH.D., VICE PRESIDENT FOR 
        RESEARCH, FOUNDATION FOR DEFENSE OF DEMOCRACIES

    Mr. Schanzer. Mr. Chairman, Mr. Ranking Member, 
distinguished members of this committee, on behalf of the 
Foundation for Defense of Democracies, I thank you for the 
opportunity to discuss the recent U.S. efforts to broker peace 
between the Palestinians and Israelis.
    I highlight four major issues of concern today.
    The first is the timing of the recent initiative, 
particularly from Israel's perspective. The existential threat 
posed by Iran's nuclear program, coupled with the very serious 
concerns over the White House's recent decision to offer 
sanctions relief for a mere pause in that program, has cast a 
pall over every other Israeli strategic decision right now.
    Of course, this threat should not stop America from 
pursuing peace, nor does it let the Israelis off the hook on 
its commitments for peacemaking. But I believe it was 
unrealistic to ask the Israelis to make meaningful security 
compromises until this crisis passes.
    For that matter, it may have been unrealistic to expect the 
Palestinians to deliver while so many of their influential 
Sunni allies also express misgivings about Washington's 
judgment. They, too, are consumed with fear of an Iranian 
nuclear program.
    The second area of concern is Palestinian governance. For 
too long, Washington has turned a blind eye to the corrupt and 
ossified nature of the Palestinian Authority. Given the P.A.'s 
20-year track record of mishandling public funds, we might as 
well light a $600-million bonfire each year.
    Should our assistance to the Palestinian Authority 
continue--and there are some good arguments for this--it must 
be performance-based. To be clear, this approach is both pro-
Palestinian and pro-peace.
    Corruption erodes the public's trust in government, and 
that undermines whatever deal may be reached. Conversely, a 
government that commands the respect of its people will earn 
the public's confidence to negotiate a viable solution to this 
conflict.
    A good first step would be a plan for the departure of 
Mahmoud Abbas. At the age of 80, he is now 9 years into a 4-
year Presidential term.
    Leader for life of the Fatah faction and the PLO, Abbas 
crushes political opposition and silences criticism of his 
leadership by arresting journalists and even Facebook users. In 
other words, he is an autocrat.
    Why our peacemakers pinned their hopes on his leadership is 
still unclear to me. If we want change, it is time for new 
leadership.
    The third area of concern is the recent reconciliation 
agreement between the Fatah faction and Hamas. Admittedly, 
these two factions have tried and failed several times in the 
past to cement a unity deal.
    There is good reason to be skeptical again. But if Hamas 
does join either the P.A. or the PLO, it is a sign that 
Islamist terror is officially welcome.
    The fact that Abbas sees Hamas as even a possible partner 
raises troubling questions about the trajectory of the 
Palestinian nationalists' movement today.
    Of course, a unity deal could also cause a complete rupture 
in U.S.- Palestinian ties. The inclusion in the Palestinian 
Authority of Hamas, a designated terrorist organization, is 
obviously a legal trigger for a full cut in funding.
    Similarly, the inclusion of Hamas in the PLO might prompt a 
re-designation of the PLO as a terrorist organization, and that 
could lead to asset freezes at home and abroad.
    On another note on Hamas, if we are serious about weakening 
this group, then pressure must be placed on two U.S. allies, 
Turkey and Qatar. They are among the terrorist factions' top 
financial and political sponsors.
    How they remain allies of the United States while 
supporting terrorist groups--and there are others beyond 
Hamas--might actually be a good topic for future hearings.
    Finally, I am troubled about the U.S. Government's apparent 
lack of readiness to confront the so-called Palestine 194 
campaign.
    The Palestinians have renewed their initiative at the 
United Nations for recognition. Never mind that the campaign is 
designed to spurn the U.S.-led peace process and isolate the 
Israelis through diplomatic lawfare.
    Our laws stipulate a cut in funding to any agency that 
accepts the PLO. This was the case of UNESCO in 2011. Will 
Palestinian unilateralism prompt us to cut funding to a host of 
multilateral organizations?
    If this is not our preferred outcome, should we not have a 
strategy to prevent this? If it is our preferred outcome, the 
process should not be predicated upon Mahmoud Abbas's 
diplomatic maneuvers.
    In my written testimony, I note that the PLO subsidiary, 
the Palestine National Fund, could be funding these unilateral 
efforts. Some U.S. tax dollars may be allocated to the PNF 
through the P.A., and this could be a worthy investigation.
    On behalf of FDD, I thank you again for inviting me to 
testify today. I look forward to your questions.
    Mr. DeSantis. Thank you, Dr. Schanzer.
    [The prepared statement of Mr. Schanzer follows:]

    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
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    Mr. DeSantis. And the Chair now recognizes Mr. Prince for 5 
minutes.

 STATEMENT OF MR. JAMES PRINCE, CO-FOUNDER AND PRESIDENT, THE 
                       DEMOCRACY COUNCIL

    Mr. Prince. Thank you, Mr. Chairman, Mr. Ranking member.
    Despite the essential conditions for peace existing on both 
sides, as distinguished members of this subcommittee noted, in 
Secretary Kerry's Herculean efforts, the diplomatic effort has 
failed again.
    I will confine my comments to the Palestinian side of this 
equation. It is not meant to ignore or diminish the unique and 
tremendous hardships posed by the occupation, but, rather, to 
discuss the imperative of dealing with the internal dynamics 
and the corruption inherent in the Palestinian Authority.
    Since the establishment of the Palestinian Authority, the 
U.S. has vacillated in its attention to internal Palestinian 
politics. Criticism of the P.A. leadership was often perceived 
as a distraction or detrimental to the peace process. The 
immediate need of support in peace negotiation often pushed 
issues of fostering good governance, civil society to a second 
tier.
    Taking risks necessary to achieve peace and enhance the 
quality of life in Palestine requires leaders with not only the 
courage, but, also, a political mandate that will support such 
risk-taking.
    Even within Mr. Abbas's inner circle, there is a consensus 
that Mr. Abbas does not feel he has the political mandate to 
take such risks, and he is not strong enough to support any 
negotiated agreement that he negotiates.
    The Abbas P.A. has become a single-party police state ruled 
by Presidential decree. Debate and criticism is not tolerated. 
Corruption and nepotism has washed away much of the goodwill 
and legitimacy conferred onto the regime after Abbas succeeded 
Arafat.
    The absence of national elections following the expiration 
of the Presidential term in 2009 further degrades the 
legitimacy of the P.A. in the eyes of its own constituents.
    Abbas is likely to retire in advance of the next election. 
This will signal an abrupt end to the Arafat era and older 
generation.
    Infighting within the Fatah Central Committee has so far 
precluded emergence of a consensus legacy candidate. Polls 
indicate the Fatah would still win over 40 percent of the vote, 
with Hamas receiving upwards of 12 percent.
    The most remarkable indicator that should be noted is that 
34 percent of the eligible voters in the West Bank and Gaza are 
undecided or just don't agree with any of the current 
leadership.
    Allegations of corruption and mismanagement have plagued 
the P.A. since its inception. In 1999, I helped manage an 
investigation into the Palestinian International Bank.
    We presented Yasser Arafat with massive evidence of fraud, 
mismanagement, and illegalities. We suggested to him that he 
take the report and pass it over to the appropriate law 
enforcement officials.
    He replied, in very characteristic candor, ``Why? The 
Palestinian people trust me more than they trust the 
Palestinian Authority or any institution.'' President Abbas has 
taken this rule by Presidential decree to a whole other level.
    The so-called Fayyadism and a focus on institution-building 
not only reduced corruption, but, importantly, stimulated 
government collections, in spite of a decrease in gross 
domestic product.
    For the first time during Salam Fayyad's previous tenure as 
finance minister, the Palestinian budget received applause.
    I participated in a worldwide investigation that brought 
back over $700 billion into the Treasury and helped eliminate 
much of the pervasive smuggling and corruption. However, this 
very intermittent, positive trend ended following the 2006 
election.
    The international response was to wall off the Ramallah 
from the Gaza Strip. The temporary international mechanism 
followed by the Pegasus system not only channeled cash 
assistance and succeeded in stabilizing the P.A., but it 
reinvigorated an Imperial presidency that Abbas has continued 
to this day.
    Except for select ministries and agencies, such as the 
Palestinian Monetary Authority and Ministry of Education, few 
government offices operate to international standards. The 
Palestinian Investment Fund is one of the most controversial 
tools used by Abbas to wield influence and direct favors.
    As previous testimony to the subcommittee indicates, 
beginning in 2007, the PIF has operated largely as an extension 
of the presidency, directed by the chairman and CEO of the 
fund, who happens also to be deputy prime minister.
    In violation of its own charter, the PIF often directly 
competes against the local businesses and has a way of 
garnering favors with the leadership.
    In my written testimony, I talk about the Hamas and Fatah 
reconciliation and the challenges it posed. U.S. Law regarding 
cutting off assistance to a government that includes Hamas and 
the Quartet Principles for recognition are clear. Without 
workarounds, this drastic measure should only be deployed as a 
last resort.
    I would like to skip to some of the suggestions for USG 
programming that I included in my written testimony. They 
include avoiding large economic projects controlled by the 
Authority, gearing more toward small business in the West Bank 
and Gaza, with an emphasis on underserved communities.
    We should devote additional funding for rule-of-law 
programming. We need to dedicate additional resources to 
fostering independent life, political party development, 
independent candidate training, and independent need, as to 
avoid some of the missteps done by USAID and other 
international organizations in preparation for the 2006 
elections.
    U.S. Government assistance should also include evidence of 
institutional reform, such as a participatory election law that 
precludes candidates that advocate violence, civil service and 
pension reform, adding an office of Vice President, and 
allowing the P.A. ministers the ability to appoint their own 
deputies and department heads without Presidential 
interference.
    The Palestinian Authority remains the best vehicle by which 
to bring about durable peace in the region. However, lacking a 
political mandate from its own constituency, the P.A. 
leadership will be unable and unwilling to make the difficult 
decisions needed to move from the status quo.
    Thank you again for this opportunity.
    Mr. DeSantis. Thank the gentleman.
    [The prepared statement of Mr. Prince follows:]

    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
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    Mr. DeSantis. And the Chair now recognizes the gentleman 
from Florida, Mr. Wexler.

STATEMENT OF THE HONORABLE ROBERT WEXLER, PRESIDENT, S. DANIEL 
    ABRAHAM CENTER FOR MIDDLE EAST PEACE (FORMER MEMBER OF 
                           CONGRESS)

    Mr. Wexler. Thank you, Mr. Chairman, Ranking Member 
Schneider, members of the subcommittee. Thank you for the honor 
of allowing me to testify before a committee I truly cherish 
and in the company of several dear friends who I respect 
enormously.
    Although 9 months have passed and negotiations between 
Israel and the Palestinians have stalled, what was true at the 
start of the talks is even truer today: Negotiations between 
Israel and the Palestinians remain in both sides' respective 
strategic interests.
    For the Palestinians, there was and still is only one 
reality: The route to an independent state runs through a 
negotiated agreement with Israel. Neither seeking admission to 
international institutions nor threatening to dismantle the 
Palestinian Authority can achieve the dignity and justice 
Palestinians deserve in a state of their own.
    For Israel, there was and still is only one reality: To 
secure its future as a Jewish and Democratic state, a viable 
independent and, yes, demilitarized Palestinian state must be 
realized.
    So what do we do now? First, it is too soon to judge the 
nature of the reconciliation agreement between Fatah and Hamas. 
There, in fact, have been similar reconciliation agreements 
attempts in the past that were never implemented.
    On Hamas, there is no debate. Hamas is a terrorist 
organization, no ifs, no ands, no buts. We need to appreciate, 
however, that the differences between Fatah and Hamas are as 
great as the differences between Israel and the Palestinians.
    Israel's actual response to the reconciliation agreement is 
instructive. Prime Minister Netanyahu is no dove, but he has 
been careful to suspend the talks with the Palestinians and not 
cancel them outright.
    And on Tuesday, Israel walked back from threats to impose 
sanctions on the Palestinian Authority. The Prime Minister 
knows that Israel is most secure when it is working in 
cooperation with Palestinian security forces.
    Just this week, Palestinian forces uncovered and arrested 
four members of a terror cell in the West Bank that was 
plotting to attack Israelis.
    Should Congress move now to defund the Palestinian 
Authority in response to the reconciliation agreement?
    When I was in your shoes, I would have been quick to make a 
strong political statement condemning a new Palestinian 
Government that might include terrorists.
    However, if Congress defunds the Palestinian Authority and 
the P.A. cannot pay its security forces and other bills, we 
hand a victory to Hamas.
    A stated purpose of the reconciliation agreement is to 
conduct an election, a desperately needed election, in the 
Palestinian territories.
    Should the Palestinians, in fact, return to the ballot box, 
we must bolster those Palestinians who renounce violence and 
recognize Israel's right to exist.
    Cutting off U.S. funds now will depress the Palestinian 
economy, increase unemployment, and clearly advantage the 
objectives of the extremists. How does that help us? How does 
that help Israel?
    We already have sufficient laws that prevent funding of 
terrorist organizations. Let those laws serve their purpose. 
This is not the time for hasty action.
    In the immediate future, we should encourage the two sides 
to continue to deescalate the fraught situation and keep the 
window for a two-state solution open.
    Moreover, all is not lost. Progress was, in fact, achieved 
on the core issues of borders and refugees during the recent 
negotiations.
    Additionally, for the first time, the Arab League 
modernized the Arab Peace Initiative to accept the principle of 
land swaps, which would allow Israel to retain the major 
settlement blocs adjacent to the 1967 lines.
    And after working with more than 150 experts at the 
Pentagon, General John Allen presented an extraordinary 
security package that, in a two-state outcome, would include 
measures to make Israel's eastern border as strong as any 
border in the world.
    President Obama and Secretary Kerry deserve credit for 
initiating a credible process. It is now up to the two sides to 
build on what was achieved over the past year or that progress 
will slip away.
    Pope John Paul said there were two possible solutions to 
the Arab-Israeli conflict, the realistic and the miraculous. 
The realistic would involve divine intervention. The 
miraculous, a voluntary agreement between the parties.
    It is America's duty to keep pushing for the miraculous.
    Thank you, Mr. Chairman.
    Mr. DeSantis. Thank the gentleman.
    [The prepared statement of Mr. Wexler follows:]

    
    
    
    
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    Mr. DeSantis. And we will begin the questioning.
    We'll go to the gentleman from California. Mr. Rohrabacher 
is recognized for 5 minutes.
    Mr. Rohrabacher. I like that, the miraculous. That is good.
    All these things, like the progress that you mentioned, 
Bob, when the border swaps were approved, this is all just 
short term. They are meaningless unless there is this long-term 
recognition of the basic principle that is necessary to have 
peace.
    And that is for the Palestinians to say, ``Yes. Israel will 
exist.'' We are spending $400 million a year subsidizing the 
Palestinians over decades while they are being intransigent the 
whole time.
    And, again, I am not sitting here rooting that the 
Palestinians come out losers in all of this. I think the 
winners are going to be Palestinians and Israelis living side 
by side and respecting each other's rights in a two-state 
solution.
    But do you really think the United States--if there are 
only--if all we are seeing is short-term gains that don't mean 
anything unless you have that long-term understanding, we can't 
do that forever, can we?
    Yes, Bob.
    Mr. Wexler. I am not the spokesman of the Palestinian 
Authority. But, in 1988, the Palestinian Authority recognized 
Israel's right to exist. If they didn't, you wouldn't be voting 
to send money to the Palestinian Authority. That was a 
condition of American engagement with the Palestinian 
Authority.
    So what we have here--I mean, your point, though, is well 
taken, I think, in a different respect. And that is: Should the 
Palestinians, in the context of the current negotiations, 
recognize Israel as a Jewish state, as a state in the context 
of mutuality of recognition? And the answer is absolutely 
``yes.''
    But we have to be fair, with all due respect. What is 
President Abbas's negotiation position on borders? His position 
is that he will and does recognize the State of Israel within 
the 1967 lines.
    And, in fact, in the last round of negotiations under 
President Bush and--yet again, he offered a plan which gave 
Israel, of course, all of the 67 Israel plus roughly 2 percent 
of the West Bank.
    So while you and I may not think that sufficiently 
incorporates enough of the settlement blocs into the State of 
Israel in terms of their internationally recognized borders, it 
is not fair to say that President Abbas has not recognized 
Israel's right to exist. He has.
    The question is: Will he also deny, in effect, or give up 
the right of return? And that needs to be done in the context 
of a full agreement.
    And, in fairness--in fairness to him, he had an interview 
not too long ago. President Abbas was born in Safed--in the 
Israeli holy city, the Jewish holy city, of Safed.
    And he was asked, ``Do you to expect to go back to Safed? 
And, if you do, under what terms?'' And he said, ``Yes. I hope 
to go back. But I know I'll go back as a tourist. I'm not going 
back to my home.''
    Now, the next day, there were all kinds of protests and the 
Palestinian Authority calling him a traitor.
    Mr. Rohrabacher. Right. And those people who were doing 
that were not in favor of peace with Israel.
    The point is the right of return is a recognition of the 
right of Israel to exist. And until that right of return, that 
concept, ``Well, yes. We will have an agreement and then we 
will have 3 million or 4 million more of our people come within 
those borders''--that is not a recognition of Israel.
    And, again, I am hoping that someday you can have a 
Palestine and an Israel living side by side. And when they do 
say ``a Jewish state of Israel,'' let's remember that all 
throughout the Middle East, you have got the Islamic state of 
so-and-so.
    And that doesn't mean their rights of minorities aren't 
going to be protected in Israel. We all know that. When Israel 
says it is the Israeli--it is going to be a Jewish state, they 
are going to respect the rights of Muslims and respect the 
rights of Christians as well. We know that.
    But, again, my time is--of questions, I've got 30 seconds 
left. Go to the other panelists.
    Am I just off base in saying, until they say the right of 
return is gone, that they really have not recognized Israel?
    Mr. Schanzer. Look, I would just add this, Congressman 
Rohrabacher.
    I think, actually, one of the biggest challenges we have 
right now is through the UNRWA program, the United Nations 
program that is designed to help Palestinian refugees.
    What they have effectively done is they have perpetuated 
the refugee program. They have continued this so-called right 
of return challenge that we continue to face on the Palestinian 
side.
    In other words, what you had after 1948 was a situation 
where there were 800,000 refugees. Today, thanks to the laws in 
place by UNRWA, there are more than 5 million.
    Now, how is it that over the years these refugees have 
grown in number? This is an impossible number to assimilate. 
And so this is part of the problem that needs to be solved.
    I should note that there is legislation that has been 
slowly winding its way through the Senate and, I think, also in 
the House, if I am not mistaken, that looks at redefining what 
a Palestinian refugee is.
    It is no longer--it should no longer be okay to have the 
descendents of refugees, in other words, the children, the 
grandchildren, the great-grandchildren. That is how you get to 
5 million. And those people should not have refugee status. 
They need to relinquish that.
    And only the leadership of the Palestinian Authority, the 
PLO, can only--I think that that is the only message that can 
come from them, and that is how this is going to begin to 
change. Until then, you are going to have this tinderbox that 
you described.
    Mr. DeSantis. Gentleman's time has expired.
    The Chair now recognizes the gentleman from Virginia, 5 
minutes.
    Mr. Connolly. Thank you, Mr. Chairman. I am grateful for 
having today's hearing.
    I want to welcome our colleague, Bob Wexler, back.
    I share the concerns expressed by my colleagues as well as 
by supporters of both Israel and the Palestinian people.
    Over the recent breakdown in the 9-month-old talks, which 
have been brokered by the United States, it is disappointing to 
see the dissolution--or seeming dissolution of this latest 
effort to achieve progress and a peaceful resolution of a long-
standing conflict.
    Achieving a two-state solution is in the best interests of 
both the Israeli and Palestinian peoples and it is central to 
U.S. efforts to restore stability in the region.
    While there has been no shortage of finger-pointing, it 
appears the collective actions of both sides perhaps 
contributed to the erosion of any immediate chance to extend 
the talks further.
    Some characterize the Palestinian Authority's resumption of 
activities to exceed the 15 multilateral treaties and 
conventions, which it had initially agreed to suspend in the 
midst of the peace talks, and then to announce a unity 
agreement with Hamas, designated as a terrorist organization by 
the United States, and, as Mr. Wexler said, no ifs, ands, or 
buts about it, and its refusal to recognize Israel's legitimacy 
clearly undermine the chance for real progress at least for 
now.
    On the other side, some point to Israel's delay of the 
forced release of Palestinian prisoners, the final group of 104 
who Israel agreed to release in exchange for Palestine 
suspending its international recognition efforts and Israel's 
continued settlement activities, as also undercutting the 
process.
    Knowing how such actions from both sides would be 
negatively perceived by the other, I am going to be very 
curious as to the panel's views on whether the U.S. did all it 
could to manage the process.
    And I have a full statement I put into the record. With 
unanimous consent, Mr. Chairman?
    Mr. DeSantis. It will be so put in the record.
    Mr. Connolly. I thank you.
    And I would like to give the opportunity to the panel on 
that last question.
    Not for the purpose of finger-pointing or blame, but what 
could have, should have, the United States done differently or 
in addition or more of or less of that might have made a 
difference?
    Dr. Schanzer.
    Mr. Schanzer. Thank you, Congressman Connolly.
    I think that there is a lot of finger-pointing that is 
going on right now, and I think you are right to try to stay 
away from that.
    I think it is instructive to look at the United States and 
its strategy and peacemaking. And I included this in my written 
remarks as well as my spoken remarks.
    I think that the Iran issue casts a pall over the entire 
Middle East right now. It is the number one challenge. And I 
think that--but I should even note that it is not the only 
challenge. You have got a civil war in Syria. You have got a 
very unstable Egypt. You have got Arab Spring issues.
    There are only so many issues that we can solve. And I say 
that as the United States appears to be retreating from the 
Middle East, not looking to engage even more. And so how we 
decided that we would be able to take on all of these issues 
and do them successfully is still very unclear to me.
    My approach would have been to be somewhat more modest with 
the objectives, to have a quiet approach to diplomacy, not to 
set a 9-month window with an expiration date at the end, you 
know, first proclaiming that you are going to end the conflict, 
well, then, you know, have to downgrade and start to talk about 
having a framework agreement.
    I think it was all ill-advised. I think we bit off more 
than we could chew. I think that, if we do get back into the 
business of peacemaking, I think it needs to be done more 
quietly. And I suspect, by the way, it is happening right now 
anyway.
    And, in the process, as Mr. Prince and I both discussed in 
our testimonies, there needs to be a focus on the change in 
leadership inside the Palestinian Authority for a more 
legitimate government.
    Mr. Connolly. I couldn't agree with you more, everything 
you said.
    Congressman Wexler, did you want to comment?
    Mr. Wexler. Yes, please.
    First, I will agree, there is no reason to go back and 
assign blame. One of the things that I think Secretary Kerry, 
though, did right was that he effectively kept the talks secret 
for a great period of time, and I think that assisted both 
sides.
    But there is a misnomer here that needs to be recognized. 
Secretary Kerry, President Obama didn't drag anybody to a peace 
table. The Israelis and the Palestinians both wanted to be 
there from the beginning. For separate reasons, it was in their 
interests. And then we became, obviously, the facilitator.
    But let me take up on a point that the two gentlemen 
raised, and that is a change of Palestinian leadership. Well, 
in order to have a change that I think all of us would be 
comfortable with, you need to have a democratic process, and we 
need to be pragmatic about how a democratic process comes about 
in the context of the Palestinian Authority or the Palestinian 
territories.
    In order to hold it in the West Bank, you need Fatah to 
agree. In order to hold it in Gaza, you need Hamas to agree. In 
order to hold it in East Jerusalem, you need the Israelis to 
agree.
    Well, how are you going to get Fatah and Hamas to agree to 
an election unless you have a reconciliation, understanding of 
some sort?
    So we just need to be honest amongst ourselves. If we are 
going to demand a change in leadership--and we certainly want 
that leadership change to be democratic--then we need to 
understand there needs to be some accommodation with groups 
that we label as a terrorist. Otherwise, you are not going to 
have an election.
    So we at least need to be honest with ourselves. And the 
Israelis have to agree to have it in East Jerusalem, along with 
the two Palestinian sides.
    Mr. Connolly. Thank you so much.
    And, Mr. Chairman, I wonder if you would just indulge Mr. 
Prince an opportunity to respond. My questioning is over. And I 
thank both the chairman and my friend----
    Mr. DeSantis. Gentleman will have 1 minute to respond.
    Mr. Connolly. I thank the chair.
    Mr. Prince. Thank you, Congressman Connolly.
    I would agree with both the previous comments. One, there 
needs to be a democratic process, there needs to be elections. 
And, two, I think we did bite off more than we can chew in the 
recent go-around.
    The basic points of a departure in a deal is that both 
sides feel a benefit and really want to reach the end of a 
deal. I would argue that President Abbas, from the start of 9 
months ago, was not--was more interested in the process than he 
was a final status agreement.
    I do believe there were modest steps that could have been 
taken, could have been agreed upon, that would have pushed both 
sides together, but President Abbas did not believe from the 
very beginning that he had the right or ability to reach a 
final status agreement. And, therefore, the gamesmanship--not 
to mention the Israeli side--the gamesmanship continued on.
    There needs to be, as Congressman Wexler mentioned, some 
sort of democratic process to restore some sort of unity, 
cohesion within the Palestinian community. Right now, it is 
dysfunctional.
    And I don't believe any Palestinian leader that would 
emerge from the Fatah leadership will be brave enough, either 
from a security standpoint or a political standpoint, to reach 
a final status agreement.
    Mr. DeSantis. Thank the gentleman. Time has expired.
    The Chair will recognize himself for 5 minutes.
    You know, in terms of this recognizing Israel, I mean, it 
is crucial. Yes. I acknowledge they are willing to recognize 
some geographic entity called Israel.
    But if you don't recognize Israel's right to exist as a 
Jewish state, then we are not in a situation where you are 
going to have a long-term peaceful resolution.
    I mean, the whole purpose of Israel being a refuge is that 
it would be a Jewish state. And they have consistently refused 
to recognize that.
    And I will give some of the witnesses a chance. I don't 
know if that represents the broad view of the Palestinian Arabs 
in the area.
    I certainly believe that most people in Gaza do not believe 
Israel has a right to exist as a Jewish state. But that has 
been the biggest roadblock.
    There have been opportunities to have an Arab state 
throughout history. It seems like the desire to not have a 
Jewish state always trumped the desire to have a Palestinian 
state, and I don't see evidence that we have gotten beyond 
that.
    So let me ask you, Congressman Wexler. You talked about you 
would not move to defund it because, you know, you acknowledge 
Hamas as a terrorist group, but you are just not sure how this 
is going to shake out. It is true in the past there have been 
kind of attempts at unity that have fizzled.
    So at what point would you be willing to pull the trigger 
and say that we shouldn't be rewarding this type of behavior 
with Hamas?
    Mr. Wexler. If Hamas, in fact, joins a unity government and 
Hamas has not in the context of that government accepted the 
three principles adopted by the Quartet--recognize Israel's 
right to exist, renounce violence, and incorporate all of the 
aggrieved understandings between the sides--then the law is 
clear. There will not be funding.
    But at this point----
    Mr. DeSantis. But that recognition--you would not require 
that to be recognizing Israel as a Jewish state, just 
recognizing----
    Mr. Wexler. No. There is no requirement to recognize Israel 
as a Jewish state in any type of understanding that has 
previously existed between the Israelis and the Palestinians.
    We need to be, again, honest amongst ourselves. When you 
say ``recognize Israel as a Jewish state,'' do I recognize 
Israel as a Jewish state? Of course, I do. It is the Jewish 
state. Israel is the Jewish state.
    But where is that state? What makes it a Jewish state? It 
is a Jewish state because it is a majority made up of Jewish 
residents.
    Well, is that state the 1967 lines incorporating the 
settlement blocs, incorporating the settlements, or is it the 
67 lines plus the West Bank and Gaza?
    So we need to be honest. When you talk about recognizing 
Israel as a Jewish state, which I am all in favor of--don't get 
me wrong--it is not so simple on the other side.
    And I think we ought to take a look at the language of the 
Arab Peace Initiative, which is quite forthcoming. While it 
doesn't say Israel is a Jewish state and it doesn't talk 
directly about the right of return, what it says is the right 
of return will have an agreed-upon resolution.
    Every Arab country in the world has put that forward. When 
they say ``agreed-upon resolution,'' that means Israel must 
agree. Well, they know Israel will never agree to take back 5 
million refugees or even 800,000 refugees. So there has been 
movement.
    Mr. DeSantis. And let me go to Dr. Schanzer.
    What is your view? I mean, do you think, one, that moving 
to defund the aid, if this unity movement continues? And do you 
think people in Congress should be conditioning tax dollars?
    I mean, should we demand that there be a recognition that 
Israel has a right to exist as a Jewish state, given that that 
seems to be a precondition certainly for Prime Minister 
Netanyahu and I know many of us in this body.
    Mr. Schanzer. Mr. Chairman, thank you.
    Look, I would say that the difference between a Jewish 
state and just a state that deserves to exist--in my mind, 
there is really no difference.
    And my problem has always been with the Palestinian 
Nationalist movement, that it has been more based on 
destruction of the State of Israel than the creation of 
something, i.e., a Palestinian state.
    We know more about what they don't like and how angry they 
are than about what it is that they want to create. And so that 
has been my approach to this problem all along.
    Would it help if the Palestinians acknowledged that and put 
the Israelis' minds at ease? Absolutely. Should it be one of 
our preconditions? Look, I will leave that to you.
    But let me just answer to one thing that Congressman Wexler 
said. The idea of acknowledging a technocratic government that 
includes figures approved by Hamas is a slippery slope.
    The idea that you could allow the technocratic government 
to take place just because you want to see elections happen, 
that is basically acknowledging Hamas and it is opening the 
door to allow Hamas to come in as a legitimate player in the 
next elections, which is something that we have to avoid at all 
costs.
    Mr. Prince. I would definitely agree that the distinction 
between recognition of a Jewish state and recognizing the 
existence and the independence of the State of Israel is very 
nuanced and something that I think shouldn't preclude the 
United States from enforcing the law right now.
    Privately, Palestinians do--and including in Gaza, they do 
talk of the right of return. As Congressman Wexler says, it is 
sort of pie in the sky to say that Israel is going to accept 
millions of refugees. And they also talk about Israel as a 
Jewish state in Gaza City as well as Ramallah.
    What they don't say so is publicly. The leadership--and the 
Palestinian papers released a few years ago by Al Jazeera also 
reinforced this concept.
    We are talking about the Palestinian community as a unified 
group, and that doesn't exist today. The right of return and 
recognizing Israel, I would argue, is a non-issue privately. No 
Palestinian leadership worth its salt on any side really says 
that those issues still exist today.
    Mr. DeSantis. I thank the gentleman. My time is expired. So 
I thank you for that.
    And the Chair will now recognize the gentleman from 
Illinois, Mr. Schneider, 5 minutes.
    Mr. Schneider. Thank you, Mr. Chair.
    Again, thank you to the witnesses for being here.
    Congressman Wexler, with all due respect, I think Israel 
was created as a Jewish state. We celebrated the 66th 
anniversary of its creation this past Monday.
    It had its foundation on November 29th, 1947, in U.N. 
Resolution 181, a Jewish state and an Arab state. The Jews 
accepted that. The Arabs did not. And that is the battle that 
is being fought today.
    So I think the question really is: When will the 
Palestinians not recognize, but accept, that Israel is a Jewish 
state and accept that the right of return is a non-starter, as 
was discussed?
    I think it is also important to emphasize that, as you 
said, Dr. Schanzer, any P.A. reconciliation between Fatah and 
Hamas that includes a Hamas, that doesn't recognize the Quartet 
conditions, the three conditions as you noted, is unacceptable 
and cannot continue to have U.S. support.
    But the purpose of this meeting is really about what is 
next. It was in the title. And I would like to focus on what is 
next.
    A year ago--exactly a year ago Salaam Fayyad stepped down 
as Prime Minister. For many years, I think the conversations in 
this committee, around the country, were that the future 
prospects for a Palestinian state depended on the aspirations 
of Fayyad of building the institutions. He is no longer there. 
He was forced out. Hamdallah was put in replacement for Fayyad. 
We don't hear about him at all.
    What does the future of a Palestinian Authority, 
Palestinian Government, look like without people committed to 
building the institutions? And who might there be that would 
build those institutions? Dr. Schanzer?
    Mr. Schanzer. Thank you, Congressman Schneider.
    I would just concur that we have a real problem, that the 
exit of the Fayyad--look it, in many ways, this was the 
deflation of the Palestinian Nationalist project, at least one 
that had a direction and a vision.
    The defeat of Fayyad was a victory for the corruption and 
the ossified approach to government that Mr. Abbas has embraced 
over these years.
    Rami Hamdallah, the new Prime Minister, is a neophyte and 
really does not serve in that role of checks and balances 
against the presidency, which was always the intended role of 
the Prime Minister, was to check that absolute power over the 
Palestinian presidency.
    And on top of that, what we have is a very troubling 
development where the new Deputy Prime Minister, Mohammed 
Mustafa, who also happens to be the head of the PIF, has become 
a very powerful guy. You see this centralization of power 
again, and that is the concern.
    The other concern is that there is just no political space 
for new parties, new figures, to emerge. And so you have this 
monopoly over power without even allowing for new voices to 
come onto the scene, to debate, to get into that clash of ideas 
that is so necessary for democratic reform.
    And so we have got a real problem on our hands, and I have 
to say that American policy has reinforced this, that we 
continue to look at Mr. Abbas as the only one who can deliver 
and, therefore, continue to give him whatever he needs. And so 
it has compounded these problems over time.
    When Abbas goes, there is no plan for what happens next. 
There is no leadership. There is no succession. It is going to 
be a vacuum, and it will be on our heads for failing to have 
planned for that moment.
    Mr. Schneider. Mr. Prince, I will turn to you, but let me 
just interject.
    Dr. Schanzer talked about Mr. Mustafa rising, and I think 
that was somewhat predictable. Mustafa was the first choice, 
but I think, because of his engagement with PIF, he was not 
palatable, if you will. So Hamdallah kind of fills the titular 
role, but Mustafa has the power.
    Now we are looking forward. Abbas is 79 years old. There 
needs to be some commitment from the Israelis to move toward 
peace. They are going to have a partner on the other side who 
will be there for a long term. What are the prospects?
    And, Mr. Prince, Congressman Wexler, I would like both of 
your comments.
    Mr. Prince. Well, first of all, as members of the committee 
noted, there is a significant constituency that remains for 
peace in both West Bank and Gaza.
    The problem is they are not currently represented. With 
Abbas leaving office prior to the next election, there will be 
a significant vacuum. There will be infighting and there will 
be debate between the older generation and the newer 
generation.
    The question is whether the newer generation, as Dr. 
Schanzer mentioned, has the political space to actually 
represent themselves and be part of the process.
    I believe that that is something that we should start 
preparing for now. If we don't, there will be a resumption of 
not only infighting, but probably some of the violence that 
happened in 2007 in Gaza will definitely go to the West Bank.
    There is not going to be an L--PLO, Tunisian--they call 
them the Abus--that are going to run the Palestinian Authority 
in the next time around. To be a partner for peace, we need to 
look to this peace constituency and the vast population.
    Mr. Schneider. If I may give Congressman Wexler a minute.
    Mr. DeSantis. Yep.
    Mr. Wexler. Very quickly, another aspect of what Secretary 
Kerry, of course, was attempting to do is, while economics are 
not a replacement for political achievements, a very important 
part of his diplomatic initiative was attracting investment to 
the West Bank.
    And, in fact, extraordinary commitments were made mostly by 
American but, also, by some European companies to engage in the 
West Bank.
    If you go to Ramallah today, if you go to Jenin today, if 
you go to other population centers today in the West Bank, they 
are by and large far more law abiding, peaceful, and successful 
than they were, say, 10 years ago.
    What I think needs to happen in the future--Israel, 
thankfully, has had some extraordinary energy finds. Those 
energy finds, particularly in certain areas, ought to be talked 
about in terms of sharing with the Palestinians.
    You are going to need to build a port, an air facility to 
allow transport in and out of an emerging Palestinian economy.
    But these things are very difficult to do when the 
Palestinians don't have their own government in effect to 
exercise the authority to do it.
    And if I may just respond to Mr. Schneider, respectfully, I 
would be careful when referring to the U.N. Partition Plan in 
support of Israel as a Jewish state.
    Again, you consider Israel a Jewish state. I consider 
Israel a Jewish state. But the Jewish state of Israel that was 
created in the United National Partition Plan in terms of the 
boundaries is not a boundaries plan that Israel would accept 
today, and you wouldn't and I wouldn't.
    So we have to be careful in terms of--I would respectfully 
suggest, when we are talking about what is a Jewish state, it 
is not so simple.
    Mr. Schneider. I appreciate that.
    But when David Ben Gurion declared independence on May 14, 
he declared the Jewish state of Israel.
    Mr. Wexler. Yes.
    Mr. Schneider. It has stayed that. It will remain that. And 
any negotiated peace between the Palestinians must assure that.
    Mr. Wexler. I agree.
    Mr. Schneider. Thank you very much.
    Mr. DeSantis. The gentleman's time is expired.
    The Chair now recognizes the gentleman from North Carolina, 
Mr. Meadows, for 5 minutes.
    Mr. Meadows. Thank you, Mr. Chairman.
    Thank each of you for your testimony.
    Mr. Schanzer, I want to go to you. I saw, I guess, reaction 
to Mr. Wexler's response just in your face. So I will give you 
a few minutes to respond.
    Mr. Schanzer. Sure. Thank you, Congressman Meadows.
    Look it, I would just say this to Congressman Wexler. The 
idea of ensuring continued financial assistance or financial 
incentives to the Palestinian Authority right now is putting 
the cart before the horse.
    Without the reform that is necessary, the $4 billion that 
the United States promised the Palestinians, should an 
agreement be struck, would have been wasted.
    In many ways, this was actually a helpful step by not 
allowing the peace process to go through before the reform 
process could take place. It would have been a sinkhole.
    We have seen what has happened before where hundreds of 
millions, in fact, billions, of dollars have been plowed into 
the Palestinian Authority over the last 20 years.
    Since 1994, we have provided billions of dollars. The 
Europeans have provided billions of dollars. The Arab Gulf 
States have provided billions of dollars.
    And we do not see a Palestinian Authority that is in much 
better shape today to perform the tasks of governance in a way 
that they would be respected in the Palestinian Authority or 
internationally.
    And so, again, this underscores the same problem that I 
have been focusing on here at this subcommittee, at the 
committee level as well, that there is a huge problem of 
legitimacy, a huge problem of corruption, inside the 
Palestinian Authority that must be tackled if we are going to 
be able to move forward.
    Mr. Meadows. All right. Let me go a little bit further, 
because I just returned from the region and three things 
concern me greatly.
    One, we continue to spend money. And it is a complex 
situation. Everybody knows that. If it was easy, it would have 
been solved long ago.
    However, I went into a terror tunnel that had just been 
constructed with moneys that we probably sent to folks in Gaza. 
A mile and a half long, concrete floors, concrete walls, 
concrete ceilings, communication, rail, lights.
    And, yet, here we are talking about economic development 
and, yet, this mile-and-a-half-long tunnel, probably built with 
American taxpayers' moneys, with the sole purpose of coming up 
in the middle of a field so they could abduct Jewish settlers 
at a--not settlers--Jewish folks in a kibbutz troubled me.
    At what point do we say enough is enough?
    Mr. Schanzer. Well, Congressman Meadows, I would just add 
this. The money has been cut off largely to the Palestinian 
territory of Gaza. We have done a pretty good job of bottling 
that up.
    There are some things--and, actually, Mr. Prince can speak 
to this--where there is money that has been going through to 
the power plant inside the Gaza Strip that is coming from the 
Palestinian Authority, which, of course, we fund.
    Mr. Meadows. Right.
    Mr. Schanzer. And so there are some millions of dollars 
that are still leaking through. There is also the pressure that 
is placed on the Israelis to ensure that the cement and other 
goods get through to the Gaza Strip and, if it doesn't, then, 
of course, the Israelis get blamed for humanitarian----
    Mr. Meadows. But therein is the thing. It is meant that we 
are getting there and it is being built in tunnels to come back 
at the very people who are providing it.
    Mr. Schanzer. That is right. That is right.
    But I would actually just add one more thought, and that is 
that the top sponsors of Hamas right now are two U.S. allies. 
And this needs to be addressed.
    You have Qatar and Turkey. They are now the two top 
sponsors and financiers of the Hamas organization. These are 
not allies any longer if this is what they are doing, and we 
have yet to address that. I think it is a serious problem.
    Mr. Meadows. So, Mr. Prince, you would agree we need to 
address that in terms of Qatar and Turkey?
    Mr. Prince. I agree. I think Qatar is one of the most 
pressing issues today. I happened to be in Gaza when the Royal 
Family visited some time ago.
    With the change in relationship with the Egyptian 
Government, Qatar remains--to a lesser extent, the Iranian 
money--Qatar remains the largest financier of society in Gaza.
    I would--just to go back to the question of tunnels and 
economic developments--or assistance, cutting off U.S. 
assistance leads people to increased dependency. We have the 
humanitarian issue, and we end up spending money in many 
different ways indirectly.
    The question of the large economic development program 
proposed by Secretary Kerry, I don't believe, as Dr. Schanzer 
said, would have a positive impact on Palestinian society.
    From an economic development standpoint, I spent years 
going through almost every commercial enterprise in West Bank 
and Gaza. The region can't absorb that amount of money.
    Large infrastructure projects, like Congressman Wexler 
mentioned, look nice. They help the leadership. But they are 
not filtering down to providing durable jobs to local 
Palestinians.
    And until we focus on that, we are not going to solve the 
problem. So the question of assistance is not cutting it off, 
but doing it smarter.
    Mr. Meadows. Okay. And my time is expired.
    So I would ask for the record if you would respond in 
writing in terms of what can we do about the incitement that is 
going on each and every day within that group. Because it is 
hard to get a negotiated deal when you are adding fuel to the 
fire, so to speak.
    I will yield back, Mr. Chairman. Thank you.
    Mr. DeSantis. The gentleman's time is expired.
    The Chair now recognizes the gentleman from California, Mr. 
Vargas, for 5 minutes.
    Mr. Vargas. Thank you very much, Mr. Chairman. Thank you 
for the opportunity to speak.
    I want to thank the witnesses.
    And, in particular, I want to thank Congressman Wexler. 
Thank you for being here. And, in particular, I would like to 
thank you for the quote of Pope Francis.
    I am a former Jesuit myself in an ocean that the realistic 
is the divine intervention. I like that. It is probably true. 
The miraculous would be the voluntary agreement.
    And you have been somewhat of a stickler here for details; 
so, I am going to be a little bit of a stickler with you, if 
you don't mind.
    You have been using the date 1967 and 67 interchangeably. 
It is not. Israel is one of the few nations where both of those 
dates make sense. You can talk about the Israel of 1967, and 
you can talk about the Israel of 67. The Israel of 67 is much, 
much, much larger. Remember, it was a country in 67. So you do 
have to be careful when you use it.
    I hear the President and others talking about the 67 lines. 
Well, the 67 lines would really tick off the neighbors because 
that would be a very, very large Israel today, the Northern 
Kingdom and the Southern Kingdom.
    But, anyway, all of that aside, I do want to talk about 
this within the context of Iran because, you know, to me, it 
almost seems trite that we are arguing about this.
    The reality is that Israel can take care of itself and, 
interestingly, Israel can also secure the Palestinians. One of 
the things that people don't talk about, but--you know, a lot 
of the Palestinians have it pretty darn good because Israel 
supports them.
    You don't think that they would need to be protected from 
their neighbors, just ask Syrians, you know, ``How do you do 
out there by yourself?'' You know, it is a pretty mean 
neighborhood.
    So we are trying to get to a peace. And you say it is in 
the interest of both, but it almost seems trite within the 
context of this existential threat that Iran poses to Israel 
and, ultimately, the threat it poses to ourselves.
    Would you comment on that, Congressman, in particular.
    Mr. Wexler. The threat of a nuclear-armed Iran is in and of 
itself, in my humble estimation, the most important endeavor 
that we must seek to defang, to defeat.
    And while, yes, in any sense of reality, an Israeli Prime 
Minister, as would an American President, in the context of a 
region must consider all of these facts.
    But we have been very careful--when I say ``we,'' I think 
most of us on the American side that hold Israel's security 
very dear--we have been very careful never to mix the two.
    The fact of the matter is the Israeli-Palestinian conflict, 
the resolution of that conflict is in the interest of both the 
Israelis and the Palestinians and on the merits of the conflict 
itself.
    Because if we have learned anything from the Arab Spring, 
it should be that the Israeli-Palestinian conflict is not the 
cause of all of the root of evil in the region. It is one 
distinct set of circumstances that respectfully should be 
handled on its own based on its own merits.
    Now, in reality, an Israeli Prime Minister certainly will 
consider the range of options in terms of what progress or non-
progress is made with Iran. Clearly, that is the case.
    And, unfortunately, it seems we were unable to make great 
progress on the Israel-Palestinian front prior to the 
culmination or the non-culmination of the talks with Iran.
    But I think it would be a mistake if we joined the two 
together, the Israeli-Palestinian conflict and the Iranian 
nuclear program, in a way in which both had to be dealt with in 
some type of simultaneous or comparable way. I don't think that 
would benefit either the Israelis or the Palestinians.
    Mr. Vargas. Dr. Schanzer?
    Mr. Schanzer. Thank you.
    I would just respond in this way, that the United States 
has had the ability to impose its will on the Israelis and 
Palestinians only at times when it has been able to demonstrate 
strength.
    I think about the aftermath of the 1991 Gulf War and how, 
at that point, the United States looked invincible. And it was 
at that point also that the Arab states, the Palestinians and 
Israelis, got in line and began to work through this--what is 
now known as the Oslo Process.
    We have a problem now that we look weaker than we have in 
recent memory. We do not appear to be able to have our way, 
which, really, when you think about the Iraq war, you think 
about Afghanistan, the war on terror, we have not enforced our 
own red lines in Syria. We can't seem to be able to solve this 
Iranian problem. We have a credibility problem right now. We 
need some wins.
    My sincere belief is that, if we begin to take care of some 
of these problems--look it, whether it is the Iran problem, 
whether it is the Syria problem, whether it is bringing some 
order back to the Arab world after the Arab Spring, whatever it 
is, if we begin to do that, I believe it will become that much 
easier to start to get the Palestinians and Israelis to take 
this peace process seriously.
    Mr. Vargas. Thank you.
    Mr. Prince, I apologize. My time has expired, but I was 
going to go to you.
    Thank you, Mr. Chairman.
    Mr. DeSantis. The gentleman's time is expired.
    The Chair now recognizes the gentleman from Florida, Mr. 
Yoho, for 5 minutes.
    Mr. Yoho. Thank you, Mr. Chairman.
    Gentlemen, I appreciate you being here.
    Let me start with the money that we have invested in the 
Palestinian Authority since 1988, roughly $5 billion. Last year 
approximately $500 million was given to the Palestinian 
Authority in the name of peace, is what I like to think, you 
know.
    The people back home don't want us sending any money 
overseas, especially in this economic crisis that we are having 
here.
    Yet, in this room, a couple--about a month ago, in this 
very room, sitting right where you guys are, there was a 
gentleman talking about Resolution 21 and 23 in the Palestinian 
Authority loosely knit government laws that pays criminals that 
have created crimes of terrorism against Americans and Israeli 
citizens that are sitting in Israeli prisons.
    The larger the act of terrorism, the larger the stipend 
they get. I think the average was $3,600. I have heard rumors 
of up to $10,000 a month when the average income in that area 
is around $5,000.
    So we put in a resolution that says all funding to the 
Palestinian Authority gets cut until they remove Resolution 21 
and 23.
    Starting with you, Dr. Schanzer, I would like to hear your 
thoughts, and Mr. Prince, and Congressman Wexler. What effect 
would that have?
    Mr. Schanzer. The cutting of funding?
    Mr. Yoho. To stop it.
    If we are giving this money in the name of peace and they 
are promoting terrorism--you know, if you steal a loaf of 
bread, you go to prison. But if you commit a crime of terrorism 
and kill somebody, you go to prison and get a check.
    And I think that is just reprehensible, that the American 
taxpayers are flipping the bill. And I know it goes into a 
fungible pot and they say, ``We are not using your money.'' I 
don't buy it. If you want our money, you need to stop promoting 
that kind of activity.
    Mr. Schanzer. Congressman Yoho, you are absolutely correct. 
Here is the problem. And, I mean, there are a couple of 
problems here.
    Number one, what Mr. Abbas has done is he has actually 
delivered on peace. In other words, he brought an end to the 
Intifada in 2005. From 2000 to 2005, there was violence raging 
everywhere, and he was the leader.
    After Yasser Arafat died, he was able to bring all of those 
different militias under the control of the Palestinian 
Authority. He, you know, made sure to disarm them.
    And so, in that sense, the Israelis are much happier with 
his leadership and--as are we, I think, you know, generally 
speaking.
    The problem is that, even though he has brought an end to 
the violence, he has maintained a culture of violence, 
nevertheless. And so that means paying off the terrorists who 
are in jail. It means the incitement that we see in mosque 
sermons and on television.
    And so there is a baseline of hatred that Mahmoud Abbas has 
maintained and we have, to a certain extent, underwritten this. 
The problem now moving forward is what do you do about it.
    You know, if we zero out Palestinian funding, then here is 
the big problem. You are going to have someone else come in and 
they are going to be worse.
    More than likely, you are going to see the Saudis, the 
Iranians, the Qataris, the Turks. They are all going to come in 
and they are not even going to hold the Palestinians to account 
at all.
    The important thing from my perspective, if we are going to 
keep the funding going, we need to make sure that we have 
tighter controls. We need to demand performance. And, in my 
opinion, we have just simply failed to do so.
    Mr. Yoho. Mr. Prince.
    Mr. Prince. I would definitely agree. The issue of 
prisoners is extremely dicey. Mahmoud Abbas has basically 
guaranteed security through the old-time-mafia type of way of 
delivering brown bags of cash to people, and that includes 
families of political prisoners.
    Mr. Yoho. Right. We have read about those.
    Mr. Prince. And that has continued today. At least Arafat 
demanded something in return. Mahmoud Abbas, usually it is just 
to support acquiescence to his leadership.
    The wholesale cutoff, as Dr. Schanzer said, presents a wide 
variety of problems. It is diminished leverage. It leaves a 
void.
    The degree of dependency right now on international 
assistance doesn't really allow for a wholesale cutoff because 
aid agencies or extremists groups will come in to serve them.
    I would argue, though, that there are a significant amount 
of conditions we should be putting on aid so that it is not 
fungible.
    Mr. Yoho. I agree. I think get rid of Resolution 21 and 23 
and we will get along fine. But until you stop promoting 
terrorism, I don't see how you are going to get peace.
    And, you know, you had touched on something else--and I 
think you are right on--is we see a weakened America and we see 
an emboldened other part of the world, and they are stepping 
up.
    And what effect do you think the Iran negotiations over the 
nuclear weapons and--right where we are at right now--what 
effect does that have on the security of the Israel and 
Palestinian area?
    Go ahead, Congressman Wexler. You haven't had a chance.
    Mr. DeSantis. The gentleman's time is expired.
    Mr. Yoho. I am sorry. My time is expired.
    Mr. DeSantis. Go ahead and take 30 seconds.
    Mr. Wexler. Well, first, I would agree that no American 
taxpayer's money should be going to fund terrorist families 
directly or indirectly, and any way in which you can go about 
to prevent that is an admirable attempt.
    But I would also respectfully suggest you vote for this--I 
don't want to mischaracterize you. You say you vote for this 
because you are about achieving peace.
    Well, I would suggest it really should be more than just 
peace at this point. It should be peace and, when not peace, at 
least security.
    And we need to be realistic that there are forces within 
the Palestinian society that, in fact, support violence in a 
very overt way and there are those that oppose it in an overt 
way.
    And those that oppose it are not necessarily Boy Scouts and 
they are not necessarily people you and I would vote for, but 
they oppose violence. And that is what President Abbas has 
done.
    And so, when given the choice of the two teams that 
unfortunately we have at this point, if there becomes a third 
team or a fourth, then let's go for it.
    But now we have got the Hamas team, and there is nothing 
good about that team. And then you got the Fatah team, which 
has all kinds of warts and all sorts of problems, but they 
oppose violence.
    Mr. DeSantis. The gentleman's time is expired.
    The Chair now recognizes the gentlewoman from New York, Ms. 
Meng, for 5 minutes.
    Ms. Meng. Thank you to our speakers for being here and to 
Congressman Wexler. It is an honor to hear from all of you.
    While we are on the topic of aid, I am just curious. How 
much--are the Palestinian people aware of the aid that the 
United States gives them and how much do we give them?
    Mr. Schanzer. Congresswoman Meng, they are very aware. And 
they are also very aware of how little of it trickles down to 
them, and that is ultimately, I think, one of the greatest 
challenges that we face.
    So here you have a Palestinian leadership that has brought 
in this $5 billion that we have heard about throughout the 
afternoon.
    There has been a significant investment on the part of the 
Europeans, Arab states, et cetera, and it has been a sinkhole.
    The middle class has not found a way to benefit from it. 
The lower class has been kept in refugee camps and in squalor.
    And so the problem is creating a system whereby these funds 
can actually find their way to the right people. And under this 
leadership--and Congressman Wexler mentioned that the Fatah 
faction has warts. That is an understatement.
    In other words, as long as the Fatah faction holds sway, 
they are going to withhold these funds. They are going to 
prevent these funds from reaching the middle and lower classes.
    And that, in turn, perpetuates conflict. That is something 
that needs to stop. And, again, that is all about leadership. 
It is about preparing for that next generation of Palestinian 
leaders.
    We should be making sure that they have the oxygen, the 
ability now, to present their ideas, and that is something that 
we have failed to deliver on for the Palestinian people.
    And it is for that reason that, despite the billions of 
dollars that we have provided to the Palestinians, they still 
resent us. They think that we are on the side of Abbas.
    Mr. Prince. If I may, Congresswoman Meng, I agree 
wholeheartedly. Every Palestinian is aware of the assistance 
provided by the United States, whether it is direct, indirect, 
through the United Nations or any other agency.
    The question of whether it is viewed positively--and that 
is something that you can trace back from the inception of the 
P.A., that the general population has viewed these assistance 
programs less and less positively since the time of Arafat.
    If you go back to the 2006 elections in which Hamas emerged 
victoriously, there was a USAID program to announce new 
projects very close--during the campaign period close to the 
elections.
    It was a relatively thinly veiled attempt to inform the 
voters of the value of the assistance and the relationship with 
the United States. You could track the polls when those 
programs were announced, the decrease in support for Mahmoud 
Abbas and old-time Fatah.
    The belief is that our assistance programs on security, 
environmental and health are central, critical, useful. Our 
assistance on democracy and governance and economic development 
has largely been siphoned off or used to support the powers 
that be and have not filtered down to the local population.
    Mr. Wexler. If I may?
    Mr. DeSantis. Sure.
    Mr. Wexler. Secretary Kerry's approach, the diplomatic 
effort that he just led, was a multifaceted approach. He took 
on the political issues, he took on the diplomatic-related 
political issues, he took on the economic issues, and he took 
on civil society often in partnership with our European allies.
    And under ideal circumstances, you address every aspect of 
Palestinian Authority simultaneously to build the kind of 
society that we have been talking about. The problem is, at 
least for the time being, that has broken down.
    So the question is: How can you salvage as much positive 
results as humanly possible? And the reality is, unfortunately, 
that Hamas plays a role within Gaza that is completely 
unacceptable to us, to the Europeans and, of course, to the 
Israelis and, in many respects, unacceptable to President Abbas 
himself.
    So the question is: How do we devise a strategy where we 
get to the point--the type of accountability that these 
gentlemen rightfully are highlighting? And, unfortunately, it 
is very difficult to do in a non-democratic atmosphere.
    Ms. Meng. Thank you.
    What steps has President Abbas taken over the past 9 months 
to prepare the Palestinian people for peace? And is there--how 
much support is there amongst these people for a peace deal?
    Mr. DeSantis. The gentlewoman's time is expired.
    I know we just called the vote. So I am going to 
recognize----
    Ms. Meng. We are not coming back?
    Mr. DeSantis. No. No. No. We are going to continue. But I 
want to make sure. I don't think that we will reconvene after 
the votes.
    So I will recognize the gentleman from Arkansas, Mr. 
Cotton, for 5 minutes.
    Mr. Cotton. Thank you. Dr. Schanzer, I noticed that you 
were shaking your head in apparent disagreement with Mr. 
Wexler's comments on Secretary Kerry's actions.
    Do you care to elaborate on your head-shaking?
    Mr. Schanzer. Apparently, I have been somewhat expressive 
this afternoon.
    Thank you, Congressman Cotton.
    Look it, this is where I would disagree. I don't believe 
that Secretary Kerry's approach was multifaceted. I think that 
Secretary Kerry, while I believe that he was absolutely earnest 
in his attempts at peacemaking, fell into a familiar trap.
    I recently wrote a book where I went around and I 
interviewed former peacemakers, from Dennis Ross, to Aaron 
David Miller, to Elliott Abrams, and they all basically said 
the same thing. And I believe we saw a reprise of that with 
Secretary Kerry, and that is the emphasis of the transaction 
over the transformation.
    What do I mean by that? We continue to aim for that 
handshake on the White House lawn. Right? You think about these 
grand--you know, maybe winning that Nobel Prize, redrawing the 
map. And in the process, you don't get down to that less-than-
sexy approach of state-building on the Palestinian side.
    We continue to ignore the fact that these are basically 
autocrats, that these are kleptocrats. And, look it, if you 
really think that this was a multifaceted approach, ask 
yourself: Why was it that we didn't talk about preparing for 
new elections? Why was it that we didn't talk about preparing 
for the exit of Mahmoud Abbas, who is now so many years past 
the end of his term?
    I mean, we pinned our hopes on one guy who had already 
passed his expiration date. That is not about reform. It is not 
about state-building.
    And so we ignored the transformation again in order to get 
that transaction done. We need to learn how to walk and chew 
gum, and I don't believe that this administration did that this 
time around.
    Mr. Wexler. If I may.
    Mr. Cotton. Yes, you may.
    Mr. Wexler. Secretary Kerry didn't talk about a full-
fledged election because, in order to have a full-fledged 
election in the Palestinian territories, you need to have 
Hamas's agreement and we don't deal, rightfully so, with Hamas.
    Now, we could redo--or attempt to try to redo what was 
done. And I do not say this in a critical fashion toward 
President Bush.
    But President Abbas came to President Bush the first time 
around and said, ``Should I include Hamas in the election?'' 
And President Bush, for all the right reasons--I am not 
criticizing--said, ``Yeah. Go out and beat them. That is the 
best way to get this scenario in order.''
    Well, lo and behold, probably because the people felt Fatah 
was corrupt and a whole lot of misdirection on politics and so 
forth, Hamas beat Fatah.
    But to criticize the United States for not pushing an 
election in the Palestinian Authority when half of the 
Palestinian territory is controlled by a terrorist organization 
I think is somewhat duplicitous.
    Mr. Cotton. Mr. Wexler, we didn't have the opportunity to 
overlap. I know your record on these issues. That was long and 
distinguished.
    Can we talk briefly about more fundamental matters? It 
seems to me, as I have observed for years, first as a civilian, 
then a soldier, and now a Member of Congress, the fundamental 
problem is Palestinian rejectionism.
    Why is it that Mr. Abbas and Palestinian leadership can't 
recognize Israel as a Jewish state, in your opinion? Why can't 
they give up the right to return?
    You know, you have a much longer professional experience 
with these matters and have dealt directly with many of the 
people involved. I would appreciate your perspective.
    Mr. Wexler. What we have here is nothing less than two 
competing historical narratives--two peoples, two competing 
historical narratives. And, unfortunately, the manner in which 
the Palestinian side thus far--the Arab side, to a large 
degree, for many decades, essentially viewed this as a zero-sum 
game. ``If we recognize the Jewish national peoples' historical 
narrative, then our side somehow gets slighted.''
    And until that is overcome, Prime Minister Netanyahu was 
right. We are not going to have full peace. That is why it is 
so important, I believe, for the Palestinians to recognize 
Israel in the context of being a Jewish state. But we also need 
to be fair.
    If you are going to do that, you have got to tell them 
where the borders are. Where is the border? Where are the lines 
of that state?
    And we also need to be fair to Prime Minister Netanyahu. He 
has not asked for recognition of a Jewish state as a 
precondition. He has said that it should be a part of the 
complexity of a comprehensive agreement.
    And, in that context, if you have a resolution on 
Jerusalem, if you have a resolution on borders, I am actually 
confident that the Palestinians, in theory, might be closer to 
accepting that position.
    Mr. Cotton. Yeah. I mean, the fight over narratives goes 
back beyond just where we are today. I mean, it was treated as 
great news that Mr. Abbas recognized the Holocaust to have 
existed and you still have temple denialism as well.
    A lot of the issues you raise, though, Yasser Arafat had a 
chance to accept in 2000, did he not, and he declined it to 
Bill Clinton and Bill Clinton said that he had made Bill 
Clinton a failure?
    Mr. Wexler. You are right.
    Mr. Cotton. I regret that I am. Thank you.
    Mr. DeSantis. The gentleman's time is expired.
    The votes have been called, but we do have time. So I will 
recognize my colleague from Florida, Ms. Frankel, for 5 
minutes.
    Ms. Frankel. Thank you, Mr. Chair.
    And, first, I want to say welcome to my former colleague in 
the state legislature and distinguished member of this 
committee, Mr. Wexler, and recognize also that I have an 
extraordinary constituent in the audience today who is a dear 
friend, a remarkable patriot who served us during World War II. 
He is a great American entrepreneur and an unyielding advocate 
for Israel for Peace.
    Danny Abraham, welcome to you.
    Two days ago some of our colleagues here--we went to the 
floor. We celebrated Israel's 66th Independence Day, its 
birthday, praised the relationship of the United States and 
Israel.
    And we also noted that the day prior Israelis commemorated 
Memorial Day to pay tribute to the 24,000-plus Israeli men, 
women, and children who have lost their lives to the war on 
terror.
    And, you know, we have been to Israel. We know it is 
beautiful. It is modern and people live good lives, but Israel 
has never really known real long-lasting peace. There has been 
intermittent wars, periods of terrorism and so forth.
    So there have been a lot of questions and answers today. I 
will leave you with a real softball question because sometimes 
we just talk to ourselves.
    And for myself and, I know, everyone on the panel, we are 
true believers in the importance of Israel as our ally and best 
friend in the Middle East. But I am going to give you each an 
opportunity to answer the question for the American public.
    Why is it so important for Israel to reach a peace 
agreement with the Palestinians? Why is it important for our 
country, for the world and, of course, it goes without saying, 
for Israel?
    Mr. Wexler. I will be happy to start.
    Quickly, if you are a Zionist and you believe in the 
Zionist dream, then Israel needs to figure out a way to 
separate from the 4- to 5 million Palestinians that live on the 
West Bank and Gaza.
    If Israel is to remain a Jewish and democratic state--a 
secure Jewish and democratic state, it has got to figure out a 
way to separate from the Palestinian people.
    And the only way to separate, ultimately, that ensures 
Israel's security is a viable Palestinian state, demilitarized 
Palestinian state, that is independent and can go on its own.
    And in terms of the Palestinians, which is not the purpose 
of your question, though, for those of us who are Zionists, we 
must be very careful to recognize also that the Palestinian 
people have their legitimate rights and also have a historical 
narrative. And to not do so, I believe, in many ways, morally 
and ethically, is not consistent with Zionism.
    Mr. Prince. I would agree with Congressman Wexler's 
eloquent presentation of why we need to solve this problem, but 
we do have to take into account that negotiations don't occur 
in a vacuum.
    The equation has to include the Palestinian people, not 
only their national aspirations, not only the aspirations of 
the Palestinians in the diaspora and around the world, but also 
in the West Bank and Gaza.
    If you walk into a coffee shop anywhere in the West Bank or 
in Gaza, Palestinians will talk about national aspirations, but 
then they will spend 30 minutes talking about how their day-to-
day life and the troubles, feeding their family, getting a job, 
getting the sewage out of their house, getting medical 
treatments, getting antibiotics, getting adequate care, sending 
their kids abroad for college.
    If there is one thing that the Arab Spring has taught us is 
that we cannot support dictators in the absence of popular 
support.
    And the Palestinian people did not support this 
negotiation, not that there wasn't a constituency for peace, 
but they wanted to clean up their house first and show that 
there is benefits of peace to the community at large before 
reaching a final status agreement.
    Mr. Schanzer. I will keep my response short.
    I think, look it, Israel promotes American principles and 
interests in the Middle East. It must have the peace and 
security that it needs in order to do so. That is in our 
interest as well as theirs.
    Ms. Frankel. Thank you very much.
    And I yield back my time.
    Mr. DeSantis. I thank the gentlewoman.
    And I thank the witnesses. I really appreciate your time, 
and your comments and testimony are very well received by the 
members. So thank you so much.
    And this hearing stands adjourned.
    [Whereupon, at 3:29 p.m., the subcommittee was adjourned.]
                                     

                                     

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