The Gaza Bombshell Politics And Power

After failing to anticipate Hamas’s victory over
Fatah in the 2006
Palestinian election, the
White House cooked up
yet another
scandalously covert and
self-defeating Middle
East debacle: part Iran-contra,
part Bay of Pigs. With confidential documents, corroborated
by outraged former and current U.S. officials, David Rose
reveals how President Bush, Condoleezza Rice, and Deputy
National-Security Adviser Elliott Abrams backed an armed
force under Fatah strongman Muhammad Dahlan, touching
off a bloody civil war in Gaza and leaving
Hamas stronger than ever.

by David Rose

“A Dirty War”

The Al Deira Hotel, in Gaza City, is a haven of calm in a land
beset by poverty, fear, and violence. In the middle of
December 2007, I sit in the hotel’s airy restaurant, its
windows open to the Mediterranean, and listen to a slight,
bearded man named Mazen Asad abu Dan describe the
suffering he endured 11 months before at the hands of
his fellow Palestinians. Abu Dan, 28, is a member of
Hamas, the Iranian-backed Islamist organization that
has been designated a terrorist group by the United
States, but I have a good reason for taking him at his
word: I’ve seen the video.

It shows abu Dan kneeling, his hands bound behind
his back, and screaming as his captors pummel him
with a black iron rod. “I lost all the skin on my back
from the beatings,” he says. “Instead of medicine,
they poured perfume on my wounds. It felt as if they
had taken a sword to my injuries.”

On January 26, 2007, abu Dan, a student at the Islamic
University of Gaza, had gone to a local cemetery with
his father and five others to erect a headstone for his
grandmother. When they arrived, however, they
found themselves surrounded by 30 armed men
from Hamas’s rival, Fatah, the party of Palestinian
president Mahmoud Abbas. “They took us to a
house in north Gaza,” abu Dan says. “They covered
our eyes and took us to a room on the sixth floor.”

The video reveals a bare room with white walls and a
black-and-white tiled floor, where abu Dan’s father
is forced to sit and listen to his son’s shrieks of pain.
Afterward, abu Dan says, he and two of the others
were driven to a market square. “They told us they
were going to kill us. They made us sit on the ground.”
He rolls up the legs of his trousers to display the
circular scars that are evidence of what happened
next: “They shot our knees and feet—five bullets
each. I spent four months in a wheelchair.”

Abu Dan had no way of knowing it, but his tormentors
had a secret ally: the administration of President George
W. Bush.

A clue comes toward the end of the video, which was
found in a Fatah security building by Hamas fighters
last June. Still bound and blindfolded, the prisoners
are made to echo a rhythmic chant yelled by one of
their captors: “By blood, by soul, we sacrifice ourselves
for Muhammad Dahlan! Long live Muhammad Dahlan!”

There is no one more hated among Hamas members
than Muhammad Dahlan, long Fatah’s resident
strongman in Gaza. Dahlan, who most recently served
as Abbas’s national-security adviser, has spent more
than a decade battling Hamas. Dahlan insists that abu
Dan was tortured without his knowledge, but the video
is proof that his followers’ methods can be brutal.

Bush has met Dahlan on at least three occasions.
After talks at the White House in July 2003, Bush
publicly praised Dahlan as “a good, solid leader.”
In private, say multiple Israeli and American officials,
the U.S. president described him as “our guy.”

The United States has been involved in the affairs
of the Palestinian territories since the Six-Day War
of 1967, when Israel captured Gaza from Egypt and
the West Bank from Jordan. With the 1993 Oslo
accords, the territories acquired limited autonomy,
under a president, who has executive powers, and
an elected parliament. Israel retains a large military
presence in the West Bank, but it withdrew from
Gaza in 2005.

In recent months, President Bush has repeatedly stated
that the last great ambition of his presidency is to broker
a deal that would create a viable Palestinian state and
bring peace to the Holy Land. “People say, ‘Do you think
it’s possible, during your presidency?’ ” he told an
audience in Jerusalem on January 9. “And the answer is:
I’m very hopeful.”

The next day, in the West Bank capital of Ramallah, Bush
acknowledged that there was a rather large obstacle
standing in the way of this goal: Hamas’s complete control
of Gaza, home to some 1.5 million Palestinians, where it
seized power in a bloody coup d’état in June 2007.
Almost every day, militants fire rockets from Gaza into
neighboring Israeli towns, and President Abbas is powerless
to stop them. His authority is limited to the West Bank.

It’s “a tough situation,” Bush admitted. “I don’t know
whether you can solve it in a year or not.” What Bush
neglected to mention was his own role in creating this
mess.

According to Dahlan, it was Bush who had pushed legislative
elections in the Palestinian territories in January 2006,
despite warnings that Fatah was not ready. After
Hamas—whose 1988 charter committed it to the goal
of driving Israel into the sea—won control of the
parliament, Bush made another, deadlier miscalculation.

Vanity Fair has obtained confidential documents, since
corroborated by sources in the U.S. and Palestine, which
lay bare a covert initiative, approved by Bush and
implemented by Secretary of State Condoleezza Rice and
Deputy National Security Adviser Elliott Abrams, to
provoke a Palestinian civil war. The plan was for forces led
by Dahlan, and armed with new weapons supplied at
America’s behest, to give Fatah the muscle it needed to
remove the democratically elected Hamas-led government
from power. (The State Department declined to comment.)

But the secret plan backfired, resulting in a further setback
for American foreign policy under Bush. Instead of driving
its enemies out of power, the U.S.-backed Fatah fighters
inadvertently provoked Hamas to seize total control
of Gaza.

Some sources call the scheme “Iran-contra 2.0,” recalling
that Abrams was convicted (and later pardoned) for
withholding information from Congress during the
original Iran-contra scandal under President Reagan.
There are echoes of other past misadventures as well:
the C.I.A.’s 1953 ouster of an elected prime minister in
Iran, which set the stage for the 1979 Islamic revolution
there; the aborted 1961 Bay of Pigs invasion, which gave
Fidel Castro an excuse to solidify his hold on Cuba;
and the contemporary tragedy in Iraq.

Within the Bush administration, the Palestinian policy set
off a furious debate. One of its critics is David Wurmser,
the avowed neoconservative, who resigned as Vice President
Dick Cheney’s chief Middle East adviser in July 2007, a
month after the Gaza coup.

Wurmser accuses the Bush administration of “engaging
in a dirty war in an effort to provide a corrupt dictatorship
[led by Abbas] with victory.” He believes that Hamas had
no intention of taking Gaza until Fatah forced its hand.
“It looks to me that what happened wasn’t so much a coup
by Hamas but an attempted coup by Fatah that was
pre-empted before it could happen,” Wurmser says.

The botched plan has rendered the dream of Middle East
peace more remote than ever, but what really galls
neocons such as Wurmser is the hypocrisy it exposed.
“There is a stunning disconnect between the president’s
call for Middle East democracy and this policy,” he says.
“It directly contradicts it.”

Preventive Security

Bush was not the first American president to form a
relationship with Muhammad Dahlan. “Yes, I was close
to Bill Clinton,” Dahlan says. “I met Clinton many times
with [the late Palestinian leader Yasser] Arafat.” In the
wake of the 1993 Oslo accords, Clinton sponsored a series
of diplomatic meetings aimed at reaching a permanent
Middle East peace, and Dahlan became the Palestinians’
negotiator on security.

As I talk to Dahlan in a five-star Cairo hotel, it’s easy to see
the qualities that might make him attractive to American
presidents. His appearance is immaculate, his English is
serviceable, and his manner is charming and forthright.
Had he been born into privilege, these qualities might not
mean much. But Dahlan was born—on
September 29, 1961—in the teeming squalor of Gaza’s
Khan Younis refugee camp, and his education came mostly
from the street. In 1981 he helped found Fatah’s youth
movement, and he later played a leading role in the first
intifada—the five-year revolt that began in 1987 against
the Israeli occupation. In all, Dahlan says, he spent five
years in Israeli jails.

From the time of its inception as the Palestinian branch of
the international Muslim Brotherhood, in late 1987, Hamas
had represented a threatening challenge to Arafat’s
secular Fatah party. At Oslo, Fatah made a public
commitment to the search for peace, but Hamas continued
to practice armed resistance. At the same time, it built an
impressive base of support through schooling
and social programs.

The rising tensions between the two groups first turned
violent in the early 1990s—with Muhammad Dahlan
playing a central role. As director of the Palestinian
Authority’s most feared paramilitary force, the
Preventive Security Service, Dahlan arrested some 2,000
Hamas members in 1996 in the Gaza Strip after the group
launched a wave of suicide bombings. “Arafat had decided
to arrest Hamas military leaders, because they were
working against his interests, against the peace process,
against the Israeli withdrawal, against everything,”
Dahlan says. “He asked the security services to do their job,
and I have done that job.”

It was not, he admits, “popular work.” For many years
Hamas has said that Dahlan’s forces routinely tortured
detainees. One alleged method was to sodomize prisoners
with soda bottles. Dahlan says these stories are exaggerated:
“Definitely there were some mistakes here and there. But no
one person died in Preventive Security. Prisoners got their
rights. Bear in mind that I am an ex-detainee of the Israelis’.
No one was personally humiliated, and I never killed anyone
the way [Hamas is] killing people on a daily basis now.”
Dahlan points out that Arafat maintained a labyrinth of
security services—14 in all—and says the Preventive
Security Service was blamed for abuses perpetrated
by other units.

Dahlan worked closely with the F.B.I. and the C.I.A., and
he developed a warm relationship with Director of Central
Intelligence George Tenet, a Clinton appointee who stayed
on under Bush until July 2004. “He’s simply a great and fair man,”
Dahlan says. “I’m still in touch with him from time to time.”

“Everyone Was Against the Elections”

In a speech in the White House Rose Garden on June 24, 2002,
President Bush announced that American policy in the Middle
East was turning in a fundamentally new direction.

Arafat was still in power at the time, and many in the U.S. and
Israel blamed him for wrecking Clinton’s micro-managed peace
efforts by launching the second intifada—a renewed revolt, begun
in 2000, in which more than 1,000 Israelis and 4,500 Palestinians
had died. Bush said he wanted to give Palestinians the chance to
choose new leaders, ones who were not “compromised by terror.”
In place of Arafat’s all-powerful presidency, Bush said, “
the Palestinian parliament should have the full authority
of a legislative body.”

Arafat died in November 2004, and Abbas, his replacement as
Fatah leader, was elected president in January 2005. Elections
for the Palestinian parliament, known officially as the Legislative
Council, were originally set for July 2005, but later
postponed by Abbas until January 2006.

Dahlan says he warned his friends in the Bush
administration that Fatah still wasn’t ready for
elections in January. Decades of self-preservationist rule
by Arafat had turned the party into a symbol of corruption
and inefficiency—a perception Hamas found it easy to
exploit. Splits within Fatah weakened its position further:
in many places, a single Hamas candidate ran against
several from Fatah.

“Everyone was against the elections,” Dahlan says.
Everyone except Bush. “Bush decided, ‘I need an election.
I want elections in the Palestinian Authority.’ Everyone is
following him in the American administration, and everyone
is nagging Abbas, telling him, ‘The president wants elections.’
Fine. For what purpose?”

The elections went forward as scheduled. On January 25,
Hamas won 56 percent of the seats in the Legislative Council.

Few inside the U.S. administration had predicted the
result, and there was no contingency plan to deal with it.
“I’ve asked why nobody saw it coming,” Condoleezza Rice
told reporters. “I don’t know anyone who wasn’t caught
off guard by Hamas’s strong showing.”

“Everyone blamed everyone else,” says an official with
the Department of Defense. “We sat there in the Pentagon
and said, ‘Who the fuck recommended this?’ ”

In public, Rice tried to look on the bright side of the
Hamas victory. “Unpredictability,” she said, is “the
nature of big historic change.” Even as she spoke,
however, the Bush administration was rapidly
revising its attitude toward Palestinian democracy.

Some analysts argued that Hamas had a substantial
moderate wing that could be strengthened if America
coaxed it into the peace process. Notable Israelis
—such as Ephraim Halevy, the former head of the
Mossad intelligence agency—shared this view. But
if America paused to consider giving Hamas the
benefit of the doubt, the moment was “milliseconds
long,” says a senior State Department official.
“The administration spoke with one voice:
‘We have to squeeze these guys.’ With Hamas’s
election victory, the freedom agenda was dead.”

The first step, taken by the Middle East diplomatic
“Quartet”—the U.S., the European Union, Russia,
and the United Nations—was to demand that the
new Hamas government renounce violence, recognize
Israel’s right to exist, and accept the terms of all
previous agreements. When Hamas refused, the
Quartet shut off the faucet of aid to the Palestinian
Authority, depriving it of the means to pay salaries
and meet its annual budget of roughly $2 billion.

Israel clamped down on Palestinians’ freedom of
movement, especially into and out of the
Hamas-dominated Gaza Strip. Israel also
detained 64 Hamas officials, including Legislative
Council members and ministers, and even launched
a military campaign into Gaza after one of its soldiers
was kidnapped. Through it all, Hamas and its new
government, led by Prime Minister Ismail Haniyeh,
proved surprisingly resilient.

Washington reacted with dismay when Abbas
began holding talks with Hamas in the hope of
establishing a “unity government.” On October
4, 2006, Rice traveled to Ramallah to see Abbas.
They met at the Muqata, the new presidential
headquarters that rose from the ruins of
Arafat’s compound, which Israel had
destroyed in 2002.

America’s leverage in Palestinian affairs was
much stronger than it had been in Arafat’s time.
Abbas had never had a strong, independent base,
and he desperately needed to restore the flow of
foreign aid—and, with it, his power of patronage.
He also knew that he could not stand up to Hamas
without Washington’s help.

At their joint press conference, Rice smiled as she
expressed her nation’s “great admiration” for Abbas’s
leadership. Behind closed doors, however, Rice’s tone
was sharper, say officials who witnessed their meeting.
Isolating Hamas just wasn’t working, she reportedly
told Abbas, and America expected him to dissolve the
Haniyeh government as soon as possible
and hold fresh elections.

Abbas, one official says, agreed to take action within
two weeks. It happened to be Ramadan, the month
when Muslims fast during daylight hours. With dusk
approaching, Abbas asked Rice to join him for iftar—
a snack to break the fast.

Afterward, according to the official, Rice underlined
her position: “So we’re agreed? You’ll dissolve the
government within two weeks?”

“Maybe not two weeks. Give me a month. Let’s wait
until after the Eid,” he said, referring to the three-day
celebration that marks the end of Ramadan.
(Abbas’s spokesman said via e-mail: “According to
our records, this is incorrect.”)

Rice got into her armored S.U.V., where, the official claims,
she told an American colleague, “That damned iftar has
cost us another two weeks of Hamas government.”

“We Will Be There to Support You”

Weeks passed with no sign that Abbas was ready to do
America’s bidding. Finally, another official was sent to
Ramallah. Jake Walles, the consul general in Jerusalem,
is a career foreign-service officer with many years’
experience in the Middle East. His purpose was to
deliver a barely varnished ultimatum to the
Palestinian president.

We know what Walles said because a copy was left behind,
apparently by accident, of the “talking points” memo
prepared for him by the State Department. The
document has been authenticated by U.S. and
Palestinian officials.

“We need to understand your plans regarding a new
[Palestinian Authority] government,” Walles’s script
said. “You told Secretary Rice you would be prepared
to move ahead within two to four weeks of your meeting.
We believe that the time has come for you to move
forward quickly and decisively.”

The memo left no doubt as to what kind of action the U.S.
was seeking: “Hamas should be given a clear choice, with
a clear deadline: … they either accept a new government
that meets the Quartet principles, or they reject it The
consequences of Hamas’ decision should also be clear:
If Hamas does not agree within the prescribed time,
you should make clear your intention to declare a state
of emergency and form an emergency government
explicitly committed to that platform.”

Walles and Abbas both knew what to expect from Hamas
if these instructions were followed: rebellion and bloodshed.
For that reason, the memo states, the U.S. was already
working to strengthen Fatah’s security forces. “If you act
along these lines, we will support you both materially and
politically,” the script said. “We will be there to support you.”

Abbas was also encouraged to “strengthen [his]
team” to include “credible figures of strong standing
in the international community.” Among those the
U.S. wanted brought in, says an official who knew of
the policy, was Muhammad Dahlan.

On paper, the forces at Fatah’s disposal looked stronger
than those of Hamas. There were some 70,000 men in the
tangle of 14 Palestinian security services that Arafat had
built up, at least half of those in Gaza. After the legislative
elections, Hamas had expected to assume command of
these forces, but Fatah maneuvered to keep them under
its control. Hamas, which already had 6,000 or so
irregulars in its militant al-Qassam Brigade, responded
by forming the 6,000-troop Executive Force in Gaza,
but that still left it with far fewer fighters than Fatah.

In reality, however, Hamas had several advantages.
To begin with, Fatah’s security forces had never really
recovered from Operation Defensive Shield, Israel’s
massive 2002 re-invasion of the West Bank in
response to the second intifada. “Most of the security
apparatus had been destroyed,” says Youssef Issa,
who led the Preventive Security Service under Abbas.

The irony of the blockade on foreign aid after Hamas’s
legislative victory, meanwhile, was that it prevented
only Fatah from paying its soldiers. “We are the ones
who were not getting paid,” Issa says, “whereas they
were not affected by the siege.” Ayman Daraghmeh, a
Hamas Legislative Council member in the West Bank,
agrees. He puts the amount of Iranian aid to Hamas in
2007 alone at $120 million. “This is only a fraction of
what it should give,” he insists. In Gaza, another
Hamas member tells me the number was closer
to $200 million.

The result was becoming apparent: Fatah could
not control Gaza’s streets—or even protect its
own personnel.

At about 1:30 p.m. on September 15, 2006, Samira
Tayeh sent a text message to her husband, Jad Tayeh,
the director of foreign relations for the Palestinian
intelligence service and a member of Fatah.
“He didn’t reply,” she says. “I tried to call his
mobile [phone], but it was switched off. So I
called his deputy, Mahmoun, and he didn’t know
where he was. That’s when I decided to go to the
hospital.”

Samira, a slim, elegant 40-year-old dressed from
head to toe in black, tells me the story in a Ramallah
café in December 2007. Arriving at the Al Shifa
hospital, “I went through the morgue door. Not for
any reason—I just didn’t know the place. I saw
there were all these intelligence guards there. There
was one I knew. He saw me and he said, ‘Put her in
the car.’ That’s when I knew something had
happened to Jad.”

Tayeh had left his office in a car with four aides.
Moments later, they found themselves being
pursued by an S.U.V. full of armed, masked men.
About 200 yards from the home of Prime Minister
Haniyeh, the S.U.V. cornered the car. The masked
men opened fire, killing Tayeh and all four of his
colleagues.

Hamas said it had nothing to do with the murders,
but Samira had reason to believe otherwise. At three
a.m. on June 16, 2007, during the Gaza takeover,
six Hamas gunmen forced their way into her home
and fired bullets into every photo of Jad they could
find. The next day, they returned and demanded the
keys to the car in which he had died, claiming that it
belonged to the Palestinian Authority.

Fearing for her life, she fled across the border and
then into the West Bank, with only the clothes she
was wearing and her passport, driver’s license,
and credit card.

“Very Clever Warfare”

Fatah’s vulnerability was a source of grave concern to
Dahlan. “I made a lot of activities to give Hamas the
impression that we were still strong and we had
the capacity to face them,” he says. “But I knew in
my heart it wasn’t true.” He had no official security
position at the time, but he belonged to parliament
and retained the loyalty of Fatah members in Gaza.
“I used my image, my power.” Dahlan says he told
Abbas that “Gaza needs only a decision for Hamas
to take over.” To prevent that from happening, Dahlan
waged “very clever warfare” for many months.

According to several alleged victims, one of the tactics
this “warfare” entailed was to kidnap and torture
members of Hamas’s Executive Force. (Dahlan
denies Fatah used such tactics, but admits “mistakes”
were made.) Abdul Karim al-Jasser, a strapping man
of 25, says he was the first such victim. “It was on
October 16, still Ramadan,” he says. “I was on my
way to my sister’s house for iftar. Four guys stopped
me, two of them with guns. They forced me to
accompany them to the home of Aman abu Jidyan,”
a Fatah leader close to Dahlan. (Abu Jidyan would be
killed in the June uprising.)

The first phase of torture was straightforward enough,
al-Jasser says: he was stripped naked, bound, blindfolded,
and beaten with wooden poles and plastic pipes. “They
put a piece of cloth in my mouth to stop me screaming.”
His interrogators forced him to answer contradictory
accusations: one minute they said that he had collaborated
with Israel, the next that he had fired Qassam
rockets against it.

But the worst was yet to come.
“They brought an iron bar,” al-Jasser says, his voice
suddenly hesitant. We are speaking inside his home in
Gaza, which is experiencing one of its frequent power
outages. He points to the propane-gas lamp that lights
the room. “They put the bar in the flame of a lamp like
this. When it was red, they took the covering off my eyes.
Then they pressed it against my skin. That was the last
thing I remember.”

When he came to, he was still in the room where he had
been tortured. A few hours later, the Fatah men handed
him over to Hamas, and he was taken to the hospital.
“I could see the shock in the eyes of the doctors who
entered the room,” he says. He shows me photos of
purple third-degree burns wrapped like towels around
his thighs and much of his lower torso. “The doctors told
me that if I had been thin, not chubby, I would have died.
But I wasn’t alone. That same night that I was released,
abu Jidyan’s men fired five bullets into the legs of one of
my relatives. We were in the same ward in the hospital.”

Dahlan says he did not order al-Jasser’s torture:
“The only order I gave was to defend ourselves. That
doesn’t mean there wasn’t torture, some things that went
wrong, but I did not know about this.”

The dirty war between Fatah and Hamas continued to
gather momentum throughout the autumn, with both
sides committing atrocities. By the end of 2006, dozens
were dying each month. Some of the victims were
noncombatants. In December, gunmen opened fire on
the car of a Fatah intelligence official, killing his three
young children and their driver.

There was still no sign that Abbas was ready to bring
matters to a head by dissolving the Hamas government.
Against this darkening background, the U.S. began direct
security talks with Dahlan.

“He’s Our Guy”

In 2001, President Bush famously said that he had
looked Russian president Vladimir Putin in the eye,
gotten “a sense of his soul,” and found him to be
“trustworthy.” According to three U.S. officials, Bush
made a similar judgment about Dahlan when they first
met, in 2003. All three officials recall hearing Bush say,
“He’s our guy.”

They say this assessment was echoed by other key figures
in the administration, including Rice and Assistant
Secretary David Welch, the man in charge of Middle
East policy at the State Department. “David Welch didn’t
fundamentally care about Fatah,” one of his colleagues
says. “He cared about results, and [he supported]
whatever son of a bitch you had to support. Dahlan
was the son of a bitch we happened to know best. He
was a can-do kind of person. Dahlan was our guy.”

Avi Dichter, Israel’s internal-security minister and
the former head of its Shin Bet security service, was
taken aback when he heard senior American officials
refer to Dahlan as “our guy.” “I thought to myself,
The president of the United States is making a strange
judgment here,” says Dichter.

Lieutenant General Keith Dayton, who had been
appointed the U.S. security coordinator for the
Palestinians in November 2005, was in no position
to question the president’s judgment of Dahlan. His
only prior experience with the Middle East was as
director of the Iraq Survey Group, the body that looked
for Saddam Hussein’s elusive weapons of mass destruction.

In November 2006, Dayton met Dahlan for the first
of a long series of talks in Jerusalem and Ramallah.
Both men were accompanied by aides. From the outset,
says an official who took notes at the meeting, Dayton
was pushing two overlapping agendas.

“We need to reform the Palestinian security
apparatus,” Dayton said, according to the notes.
“But we also need to build up your forces in order
to take on Hamas.”

Dahlan replied that, in the long run, Hamas could be
defeated only by political means. “But if I am going to
confront them,” he added, “I need substantial resources.
As things stand, we do not have the capability.”

The two men agreed that they would work toward a new
Palestinian security plan. The idea was to simplify the
confusing web of Palestinian security forces and have
Dahlan assume responsibility for all of them in the
newly created role of Palestinian national-security
adviser. The Americans would help supply weapons
and training.

As part of the reform program, according to the official
who was present at the meetings, Dayton said he wanted
to disband the Preventive Security Service, which was
widely known to be engaged in kidnapping and torture.
At a meeting in Dayton’s Jerusalem office in early
December, Dahlan ridiculed the idea. “The only
institution now protecting Fatah and the Palestinian
Authority in Gaza is the one you want removed,”
he said.

Dayton softened a little. “We want to help you,”
he said. “What do you need?”

“Iran-Contra 2.0”

Under Bill Clinton, Dahlan says, commitments of
security assistance “were always delivered, absolutely.”
Under Bush, he was about to discover, things were
different. At the end of 2006, Dayton promised an
immediate package worth $86.4 million—money that,
according to a U.S. document published by Reuters on
January 5, 2007, would be used to “dismantle the
infrastructure of terrorism and establish law and order
in the West Bank and Gaza.” U.S. officials even told
reporters the money would be transferred “in the
coming days.”

The cash never arrived. “Nothing was disbursed,”
Dahlan says. “It was approved and it was in the news.
But we received not a single penny.”

Any notion that the money could be transferred quickly
and easily had died on Capitol Hill, where the payment
was blocked by the House Subcommittee on the Middle
East and South Asia. Its members feared that military
aid to the Palestinians might end up being turned
against Israel.

Dahlan did not hesitate to voice his exasperation.
“I spoke to Condoleezza Rice on several occasions,”
he says. “I spoke to Dayton, to the consul general, to
everyone in the administration I knew. They said,
‘You have a convincing argument.’ We were sitting in
Abbas’s office in Ramallah, and I explained the whole
thing to Condi. And she said, ‘Yes, we have to make an
effort to do this. There’s no other way.’ ” At some of
these meetings, Dahlan says, Assistant Secretary Welch
and Deputy National-Security Adviser Abrams were
also present.

The administration went back to Congress, and a reduced,
$59 million package for nonlethal aid was approved in April
2007. But as Dahlan knew, the Bush team had already
spent the past months exploring alternative, covert means
of getting him the funds and weapons he wanted. The
reluctance of Congress meant that “you had to look for
different pots, different sources of money,” says a
Pentagon official.

A State Department official adds, “Those in charge of
implementing the policy were saying, ‘Do whatever it takes.
We have to be in a position for Fatah to defeat Hamas
militarily, and only Muhammad Dahlan has the guile and
the muscle to do this.’ The expectation was that this was
where it would end up—with a military showdown.”
There were, this official says, two “parallel programs”
—the overt one, which the administration took to Congress,
“and a covert one, not only to buy arms but to pay the
salaries of security personnel.”

In essence, the program was simple. According to State
Department officials, beginning in the latter part of
2006, Rice initiated several rounds of phone calls
and personal meetings with leaders of four Arab nations
—Egypt, Jordan, Saudi Arabia, and the United Arab
Emirates. She asked them to bolster Fatah by providing
military training and by pledging funds to buy its forces
lethal weapons. The money was to be paid directly into
accounts controlled by President Abbas.

The scheme bore some resemblance to the Iran-contra
scandal, in which members of Ronald Reagan’s
administration sold arms to Iran, an enemy of the
U.S. The money was used to fund the contra rebels
in Nicaragua, in violation of a congressional ban. Some
of the money for the contras, like that for Fatah, was
furnished by Arab allies as a result of U.S. lobbying.

But there are also important differences—starting with
the fact that Congress never passed a measure expressly
prohibiting the supply of aid to Fatah and Dahlan.
“It was close to the margins,” says a former intelligence
official with experience in covert programs. “
But it probably wasn’t illegal.”

Legal or not, arms shipments soon began to take place.
In late December 2006, four Egyptian trucks passed
through an Israeli-controlled crossing into Gaza, where
their contents were handed over to Fatah. These
included 2,000 Egyptian-made automatic rifles,
20,000 ammunition clips, and two million bullets.
News of the shipment leaked, and Benjamin Ben-Eliezer,
an Israeli Cabinet member, said on Israeli radio that the
guns and ammunition would give Abbas “the ability to
cope with those organizations which are trying to ruin
everything”—namely, Hamas.

Avi Dichter points out that all weapons shipments had to
be approved by Israel, which was understandably hesitant
to allow state-of-the-art arms into Gaza. “One thing’s
for sure, we weren’t talking about heavy weapons,”
says a State Department official. “It was small arms,
light machine guns, ammunition.”

Perhaps the Israelis held the Americans back.
Perhaps Elliott Abrams himself held back, unwilling
to run afoul of U.S. law for a second time. One of his
associates says Abrams, who declined to comment for
this article, felt conflicted over the policy—torn between
the disdain he felt for Dahlan and his overriding loyalty
to the administration. He wasn’t the only one: “There
were severe fissures among neoconservatives over this,”
says Cheney’s former adviser David Wurmser. “We
were ripping each other to pieces.”

During a trip to the Middle East in January 2007, Rice
found it difficult to get her partners to honor their pledges.
“The Arabs felt the U.S. was not serious,” one official
says. “They knew that if the Americans were serious
they would put their own money where their mouth was.
They didn’t have faith in America’s ability to raise a real
force. There was no follow-through. Paying was different
than pledging, and there was no plan.”

This official estimates that the program raised “a few
payments of $30 million”—most of it, as other sources
agree, from the United Arab Emirates. Dahlan himself
says the total was only $20 million, and confirms that
“the Arabs made many more pledges than they ever paid.”
Whatever the exact amount, it was not enough.

Plan B

On February 1, 2007, Dahlan took his “very clever
warfare” to a new level when Fatah forces under his
control stormed the Islamic University of Gaza, a
Hamas stronghold, and set several buildings on fire.
Hamas retaliated the next day with a wave of attacks
on police stations.

Unwilling to preside over a Palestinian civil war, Abbas
blinked. For weeks, King Abdullah of Saudi Arabia had
been trying to persuade him to meet with Hamas in
Mecca and formally establish a national unity government.
On February 6, Abbas went, taking Dahlan with him.
Two days later, with Hamas no closer to recognizing
Israel, a deal was struck.

Under its terms, Ismail Haniyeh of Hamas would remain
prime minister while allowing Fatah members to occupy
several important posts. When the news hit the streets
that the Saudis had promised to pay the Palestinian
Authority’s salary bills, Fatah and Hamas members in
Gaza celebrated together by firing their Kalashnikovs
into the air.

Once again, the Bush administration had been taken by
surprise. According to a State Department official, “
Condi was apoplectic.” A remarkable documentary
record, revealed here for the first time, shows that the
U.S. responded by redoubling the pressure on its
Palestinian allies.

The State Department quickly drew up an alternative
to the new unity government. Known as “Plan B,” its
objective, according to a State Department memo that
has been authenticated by an official who knew of it at
the time, was to “enable [Abbas] and his supporters to
reach a defined endgame by the end of 2007 The
endgame should produce a [Palestinian Authority]
government through democratic means that accepts
Quartet principles.”

Like the Walles ultimatum of late 2006, Plan B called
for Abbas to “collapse the government” if Hamas refused
to alter its attitude toward Israel. From there, Abbas
could call early elections or impose an emergency
government. It is unclear whether, as president, Abbas
had the constitutional authority to dissolve an elected
government led by a rival party, but the Americans swept
that concern aside.

Security considerations were paramount, and Plan B had
explicit prescriptions for dealing with them. For as long
as the unity government remained in office, it was
essential for Abbas to maintain “independent control of
key security forces.” He must “avoid Hamas integration
with these services, while eliminating the Executive Force
or mitigating the challenges posed by its continued existence.”

In a clear reference to the covert aid expected from the
Arabs, the memo made this recommendation for the
next six to nine months: “Dahlan oversees effort in
coordination with General Dayton and Arab [nations]
to train and equip 15,000-man force under President
Abbas’s control to establish internal law and order, stop
terrorism and deter extralegal forces.”

The Bush administration’s goals for Plan B were elaborated
in a document titled “An Action Plan for the Palestinian
Presidency.” This action plan went through several
drafts and was developed by the U.S., the Palestinians,
and the government of Jordan. Sources agree, however,
that it originated in the State Department.

The early drafts stressed the need for bolstering Fatah’s
forces in order to “deter” Hamas. The “desired outcome”
was to give Abbas “the capability to take the required
strategic political decisions … such as dismissing the
cabinet, establishing an emergency cabinet.”

The drafts called for increasing the “level and capacity”
of 15,000 of Fatah’s existing security personnel while
adding 4,700 troops in seven new “highly trained
battalions on strong policing.” The plan also promised to
arrange “specialized training abroad,” in Jordan and
Egypt, and pledged to “provide the security personnel
with the necessary equipment and arms to carry out
their missions.”

A detailed budget put the total cost for salaries, training,
and “the needed security equipment, lethal and
non-lethal,” at $1.27 billion over five years. The
plan states: “The costs and overall budget were developed
jointly with General Dayton’s team and the Palestinian
technical team for reform”—a unit established by
Dahlan and led by his friend and policy aide Bassil Jaber.
Jaber confirms that the document is an accurate summary
of the work he and his colleagues did with Dayton.
“The plan was to create a security establishment that could
protect and strengthen a peaceful Palestinian state living
side by side with Israel,” he says.

The final draft of the Action Plan was drawn up in Ramallah
by officials of the Palestinian Authority. This version
was identical to the earlier drafts in all meaningful ways
but one: it presented the plan as if it had been the
Palestinians’ idea. It also said the security proposals had
been “approved by President Mahmoud Abbas after being
discussed and agreed [to] by General Dayton’s team.”

On April 30, 2007, a portion of one early draft was leaked
to a Jordanian newspaper, Al-Majd. The secret was out.
From Hamas’s perspective, the Action Plan could amount
to only one thing: a blueprint for a U.S.-backed Fatah coup.

“We Are Late in the Ball Game Here”

The formation of the unity government had brought
a measure of calm to the Palestinian territories, but
violence erupted anew after Al-Majd published its
story on the Action Plan. The timing was unkind to
Fatah, which, to add to its usual disadvantages, was
without its security chief. Ten days earlier, Dahlan
had left Gaza for Berlin, where he’d had surgery on
both knees. He was due to spend the next eight weeks
convalescing.

In mid-May, with Dahlan still absent, a new element
was added to Gaza’s toxic mix when 500 Fatah National
Security Forces recruits arrived, fresh from training in
Egypt and equipped with new weapons and vehicles.
“They had been on a crash course for 45 days,” Dahlan
says. “The idea was that we needed them to go in dressed
well, equipped well, and that might create the impression
of new authority.” Their presence was immediately
noticed, not only by Hamas but by staff from Western
aid agencies. “They had new rifles with telescopic sights,
and they were wearing black flak jackets,” says a
frequent visitor from Northern Europe. “They were
quite a contrast to the usual scruffy lot.”

On May 23, none other than Lieutenant General
Dayton discussed the new unit in testimony before
the House Middle East subcommittee. Hamas had
attacked the troops as they crossed into Gaza from
Egypt, Dayton said, but “these 500 young people, fresh
out of basic training, were organized. They knew how to
work in a coordinated fashion. Training does pay off. And
the Hamas attack in the area was, likewise, repulsed.”

The troops’ arrival, Dayton said, was one of several
“hopeful signs” in Gaza. Another was Dahlan’s
appointment as national-security adviser. Meanwhile,
emely unpopular I would say that we are kind of late in
the ball game here, and we are behind, there’s two out,
but we have our best clutch hitter at the plate, and the
pitcher is beginning to tire on the opposing team.”

The opposing team was stronger than Dayton realized.
By the end of May 2007, Hamas was mounting regular
attacks of unprecedented boldness and savagery.

At an apartment in Ramallah that Abbas has set aside for
wounded refugees from Gaza, I meet a former Fatah
communications officer named Tariq Rafiyeh. He lies
paralyzed from a bullet he took to the spine during the
June coup, but his suffering began two weeks earlier.
On May 31, he was on his way home with a colleague
when they were stopped at a roadblock, robbed of their
money and cell phones, and taken to a mosque. There,
despite the building’s holy status, Hamas Executive
Force members were violently interrogating Fatah
detainees. “Late that night one of them said we were
going to be released,” Rafiyeh recalls. “He told the guards,
‘Be hospitable, keep them warm.’ I thought that meant
kill us. Instead, before letting us go they beat us badly.”

On June 7, there was another damaging leak, when the
Israeli newspaper Haaretz reported that Abbas and
Dayton had asked Israel to authorize the biggest
Egyptian arms shipment yet—to include dozens of
armored cars, hundreds of armor-piercing rockets,
thousands of hand grenades, and millions of rounds of
ammunition. A few days later, just before the next batch
of Fatah recruits was due to leave for training in Egypt,
the coup began in earnest.

Fatah’s Last Stand

The Hamas leadership in Gaza is adamant that the coup
would not have happened if Fatah had not provoked it.
Fawzi Barhoum, Hamas’s chief spokesman, says the
leak in Al-Majd convinced the party that “there was a
plan, approved by America, to destroy the political choice.”
The arrival of the first Egyptian-trained fighters, he adds,
was the “reason for the timing.” About 250 Hamas
members had been killed in the first six months of 2007,
Barhoum tells me. “Finally we decided to put an end to it.
If we had let them stay loose in Gaza, there would have
been more violence.”

“Everyone here recognizes that Dahlan was trying with
American help to undermine the results of the elections,”
says Mahmoud Zahar, the former foreign minister
for the Haniyeh government, who now leads Hamas’s
militant wing in Gaza. “He was the one planning a coup.”

Zahar and I speak inside his home in Gaza, which
was rebuilt after a 2003 Israeli air strike destroyed it,
killing one of his sons. He tells me that Hamas launched
its operations in June with a limited objective:
“The decision was only to get rid of the Preventive Security
Service. They were the ones out on every crossroads,
putting anyone suspected of Hamas involvement at
risk of being tortured or killed.” But when Fatah
fighters inside a surrounded Preventive Security
office in Jabaliya began retreating from building to
building, they set off a “domino effect” that emboldened
Hamas to seek broader gains.

Many armed units that were nominally loyal to
Fatah did not fight at all. Some stayed neutral
because they feared that, with Dahlan absent, his
forces were bound to lose. “I wanted to stop the cycle
of killing,” says Ibrahim abu al-Nazar, a veteran party
chief. “What did Dahlan expect? Did he think the U.S.
Navy was going to come to Fatah’s rescue? They
promised him everything, but what did they do? But
he also deceived them. He told them he was the strongman
of the region. Even the Americans may now feel sad and
frustrated. Their friend lost the battle.”

Others who stayed out of the fight were extremists.
“Fatah is a large movement, with many schools inside it,”
says Khalid Jaberi, a commander with Fatah’s al-Aqsa
Martyrs’ Brigades, which continue to fire rockets into
Israel from Gaza. “Dahlan’s school is funded by the
Americans and believes in negotiations with Israel as a
strategic choice. Dahlan tried to control everything in
Fatah, but there are cadres who could do a much better
job. Dahlan treated us dictatorially. There was no overall
Fatah decision to confront Hamas, and that’s why our
guns in al-Aqsa are the cleanest. They are not corrupted
by the blood of our people.”

Jaberi pauses. He spent the night before our interview
awake and in hiding, fearful of Israeli air strikes. “You
know,” he says, “since the takeover, we’ve been trying
to enter the brains of Bush and Rice, to figure out their
mentality. We can only conclude that having Hamas in
control serves their overall strategy, because their policy
was so crazy otherwise.”

The fighting was over in less than five days. It began with
attacks on Fatah security buildings, in and around Gaza
City and in the southern town of Rafah. Fatah attempted
to shell Prime Minister Haniyeh’s house, but by dusk on
June 13 its forces were being routed.

Years of oppression by Dahlan and his forces were avenged
as Hamas chased down stray Fatah fighters and subjected
them to summary execution. At least one victim was
reportedly thrown from the roof of a high-rise building.
By June 16, Hamas had captured every Fatah building,
as well as Abbas’s official Gaza residence. Much of Dahlan’s
house, which doubled as his office, was reduced to rubble.

Fatah’s last stand, predictably enough, was made by the
Preventive Security Service. The unit sustained heavy
casualties, but a rump of about 100 surviving fighters
eventually made it to the beach and escaped in the night
by fishing boat.

At the apartment in Ramallah, the wounded struggle on.
Unlike Fatah, Hamas fired exploding bullets, which are
banned under the Geneva Conventions. Some of the men
in the apartment were shot with these rounds 20 or 30
times, producing unimaginable injuries that required
amputation. Several have lost both legs.

The coup has had other costs. Amjad Shawer, a local
economist, tells me that Gaza had 400 functioning
factories and workshops at the start of 2007. By
December, the intensified Israeli blockade had
caused 90 percent of them to close. Seventy percent of
Gaza’s population is now living on less than $2 a day.

Israel, meanwhile, is no safer. The emergency pro-peace
government called for in the secret Action Plan is now in
office—but only in the West Bank. In Gaza, the exact thing
both Israel and the U.S. Congress warned against came
to pass when Hamas captured most of Fatah’s arms and
ammunition—including the new Egyptian guns supplied
under the covert U.S.-Arab aid program.

Now that it controls Gaza, Hamas has given free rein to
militants intent on firing rockets into neighboring Israeli
towns. “We are still developing our rockets; soon we
shall hit the heart of Ashkelon at will,” says Jaberi,
the al-Aqsa commander, referring to the Israeli city
of 110,000 people 12 miles from Gaza’s border. “I
assure you, the time is near when we will mount a big
operation inside Israel, in Haifa or Tel Aviv.”

On January 23, Hamas blew up parts of the wall dividing
Gaza from Egypt, and tens of thousands of Palestinians
crossed the border. Militants had already been
smuggling weapons through a network of underground
tunnels, but the breach of the wall made their job much
easier—and may have brought Jaberi’s threat closer to reality.

George W. Bush and Condoleezza Rice continue to push
the peace process, but Avi Dichter says Israel will
never conclude a deal on Palestinian statehood until
the Palestinians reform their entire law-enforcement
system—what he calls “the chain of security.” With
Hamas in control of Gaza, there appears to be no
chance of that happening. “Just look at the situation,”
says Dahlan. “They say there will be a final-status
agreement in eight months? No way.”

“An Institutional Failure”

How could the U.S. have played Gaza so wrong?
Neocon critics of the administration—who until last
year were inside it—blame an old State Department
vice: the rush to anoint a strongman instead of solving
problems directly. This ploy has failed in places as
diverse as Vietnam, the Philippines, Central America,
and Saddam Hussein’s Iraq, during its war against
Iran. To rely on proxies such as Muhammad Dahlan,
says former U.N. ambassador John Bolton, is “an
institutional failure, a failure of strategy.” Its author,
he says, was Rice, “who, like others in the dying days of
this administration, is looking for legacy. Having failed to
heed the warning not to hold the elections, they tried
to avoid the result through Dayton.”

With few good options left, the administration now appears
to be rethinking its blanket refusal to engage with Hamas.
Staffers at the National Security Council and the Pentagon
recently put out discreet feelers to academic experts,
asking them for papers describing Hamas and its
principal protagonists. “They say they won’t talk to
Hamas,” says one such expert, “but in the end they’re
going to have to. It’s inevitable.”

It is impossible to say for sure whether the outcome in Gaza
would have been any better—for the Palestinian people,
for the Israelis, and for America’s allies in Fatah—
if the Bush administration had pursued a different policy.
One thing, however, seems certain: it could not be any worse.