The Reality After Wye

...The next week Islamic Holy War prematurely exploded a suicide car at the entrance to a Jerusalem market filled with Friday shoppers...

...Then, in the wake of the Asian and Russian financial crises, many foreign depositors needed funds to cover their losses...

...Foreign currency reserves thus grew at a pace most economists here considered unhealthy...

...To begin with, it contradicts the longstanding Israeli position that real peace is a bilateral matter and should not directly involve third parties...

...The Left would be composed of the majority of the Labor Party headed by Ehud Barak, the Meretz and Mapam parties, and the Arab ethnic parties...

...One was the extradition of 30 Palestinians charged with murdering Israelis after the Oslo agreement went into effect...

...NO MAGIC ANSWERS The Reality After Wye By Eliahu Salpeter Tel Aviv Three WEEKS and two Arab terrorist suicide bombings after Israel's Prime Minister Benjamin Netanyahu and Palestinian Authority (PA) Chairman Yasir Arafat signed the Wye Plantation Memorandum at the White House, it had not yet been put into effect by the Palestinians and was first being ratified by a fractious Israeli Cabinet...

...the hard-line settlers' movement, consisting mostly of the National Religious Party's nationalist majority...

...As matters stand, 40 per cent of it will be under PA political control after the second-stage transfer...

...Four days after the Prime Minister came home, Hamas attempted to blow up a full school bus...

...Netanyahu, alas, has no more magic answers to this predicament than did Yitzchak Shamir, Yitzchak Rabin or Shimon Peres...

...One was the nationwide strike of university and college students protesting high tuition fees...

...Indeed, Netanyahu had to retreat on the two demands he publicly insisted were not negotiable...

...This was seen as an attempt to cover up the fact that, despite Cabinet Secretary Danny Naveh's claim of "tremendous achievements" at the summit, practically nothing new was achieved...

...The unusual ferocity of the police was interpreted by some social scientists as yet another indication of mutual alienation, and of how the culture of violence was spreading from the West Bank to Israeli society...

...Newly appointed Foreign Minister Ariel Sharon, who has suddenly become the most dovish hawk in Israel's political aviary, found an original justification for Likud's fundamental ideological shift...

...In the first case, Netanyahu was forced to accept that those on the wanted list would be tried in Palestinian courts under the watchful eye of the Central Intelligence Agency (CIA...

...Similarly, the de facto approval of the agreement by its huge (and misnamed) Central Committee showed that Likud has parted with its parent Herut Party and the old Revisionists, for whom partitioning the Land of Israel is unthinkable...

...they curtailed services and increased patient copayments...

...Members of the Cabinet and the Knesset Foreign Affairs Committee were also greatly disturbed when they discovered that the Hebrew translation of the document did not correspond to the original English text...

...The odds are that both sides will ultimately do what they promised and complete the second stage of the Oslo Accords, but the key word is "ultimately...

...But when the Bank of Israel raised the prime by 2 per cent early this month to counter inflationary pressures, industrialists and exporters—the only beneficiaries of the shekel devaluation—were not happy either...

...In fact, it may turn out that his government's future will be decided by the exchange, interest and inflation rates, rather than the percentage of territory handed to the Palestinians...

...The other, less sturdy, pillar has been the high domestic interest rate...

...One soldier was killed and two were wounded...

...A move from the Right to the middle of the political spectrum by the Prime Minister would alter Israel's political complexion...

...Somewhat ironically, Netanyahu would still be vulnerable to a no-confidence vote on economic and social issues...

...Most Israelis want the Charter changed...

...Nevertheless, the Wye talks did indicate that Arafat at least realizes he has to crack down on Hamas, Islamic Holy War, and the other anti-Oslo Arab terrorist factions...

...The Israelis have been openly playing for time while trying to plug the holes that riddle the U.S.imposed agreement...

...officials serve as dayto-day arbiters of Israeli and Palestinian behavior is bound to weaken traditional American support for Israel in international disputes...

...Twenty-four people were wounded...

...Foreign funds, partly from Eastern Europe, flowed into the banks and were converted into shekels earning high interest, because they could be reconverted into dollars at a favorably low rate...

...The movement toward peace is inevitable, he declared, and without the Wye agreement there was a danger that the entire West Bank would eventually be a Palestinian state...

...Now there is a danger of further shekel devaluation and of rapid inflation, which until October had been kept at a tolerable 6 per cent annual level...

...Many Israelis argued angrily that while it was unclear who would actually do the reaffirming, let alone how, Clinton's participation in the event would virtually amount to de facto recognition of the State of Palestine by the U.S...

...Moreover, the PA only has to detail its antiterrorism measures to the U.S., not to Israel...

...This had dismal effects: Many Israelis sold their shekel savings to buy either dollars or durable goods as hedges before prices went up...

...Almost simultaneously, the health services' financial crunch came to the fore again...

...What infuriates all Israelis, though, is Arafat's "revolving door" justice system, and there is no guarantee that anyone convicted will not soon disappear from jail...

...The supervisory role assigned to the CIA has also spurred widespread questioning here...

...Pharmaceutical and medical supply companies threatened to cut off deliveries to hospitals because of unpaid bills...

...and the Messianic segments of the Ashkenazi ultra-Orthodox...

...They sold their shekels and pushed up the dollar rate some 20 per cent...

...Since most rents, mortgages and imports are dollar linked, the consequence of the latest price rises has already been an almost immediate rise in the COL Index and the Housing Index, triggering new wage demands...

...Mass tragedy was prevented when the escorting Army jeep rammed an explosive-laden suicide car...

...The relative stability even allowed a gradual reduction of the prime rate, to balance the negative impact of the unrealistically pegged shekel on exports...

...Today they account for roughly 80 per cent of the country's industrial exports...

...The picture, though, is changing...

...It would leave the far Right with several small Ultranationalist parties...

...For a fairly long time Israel maintained a stable shekel/dollar rate, or—to be exact—a very slow devaluation of its currency...

...They believe the Prime Minister was deeply impressed by recent polls showing that the country overwhelmingly favors a territorial compromise with the Palestinians and has become less and less frightened of having a Palestinian state next door...

...A substantial number argue the former...

...They boycotted classes, went on hunger strikes and clashed with police trying to keep them from blocking traffic...

...the Palestinians have been stalling more furtively, but no less self-righteously...

...Looking inward, Israelis have been debating whether Netanyahu was coming to terms with domestic political realities at Wye, or was merely trying again to delay the final-status negotiations...

...Furthermore, having U.S...

...The middle classes, who make up the major battle ground between Likud and Labor, are of course worried about their declining purchasing power...

...a few staunch not-an-inch Revisionists led by Benjamin Begin, son of the late Prime Minister...

...It should be noted, too, that even on their most dramatic days the Maryland negotiations had strong competition here for the top front-page headlines from subjects the Israeli public considers almost equally important...

...Eliahu Salpeter, a regular NL contributor, is a correspondent for Ha'aretz...

...It is against the background of such troubles that the public's reaction to Wye politics on the one hand, and to continued terrorism on the other, must be seen...

...This kept the Cost-of-Living Index (COL) below the figure that would justify demands for wage increases...

...The second was a vote by the full Palestine National Council eliminating the 26 clauses in the Palestine National Charter calling for Israel's destruction...

...Hospitals threatened to send patients home because the health insurance funds owed them hundreds of millions of shekels...

...The insurance funds, overburdened by the demands of the new National Health Insurance Law, complained that government debts were choking them...

...The emerging new Center would be comprised of the majority of both Likud and the Sephardic Orthodox, plus elements of the Labor Party devoted to Shimon Peres...

...One is the dramatic expansion of its innovative high-tech computer and electronics industries...

...Israel's "economic miracle" rests on two separate pillars...

...Tough Israeli reaction to terrorism is mandatory, but it increases the Palestinians' support of the terrorists, effectively giving them a quasiveto power over the peace process...

...Both attacks demonstrated that Netanyahu, although moving toward a peace settlement, faces the same dilemma that bedeviled his predecessors...

...But the memorandum, critics have observed, does not include maps demarcating the areas to be given up...

...Meanwhile, two other socio-economic problems erupted...

...Primary among these, as we shall see, are the deteriorating economic situation and the new divisions in the Likud-led coalition as well as in the Labor-led opposition...

...As for the Palestine Charter, it does not bode well for future relations that Arafat is obviously incapable of securing the two-thirds majority of the National Council required to eliminate the offending clauses, because over one-third of its members represent organizations opposed to Oslo altogether...

...Labor and the Left backed the students...

...But by making it a sine qua non, Netanyahu painted himself into a corner from which President Clinton had to extract him—at a high price: The President undertook to go to Gaza for a meeting of the National Council, to witness the "reaffirmation" of the purging of those clauses...