Palestinians Aid Cash-Strapped Government

Palestinian Prime Minister Ismail Haniyeh of the Islamic group Hamas attends a rally in Gaza City Thursday, May 11, 2006. Israel has agreed to release tens of millions of dollars it withheld from the Palestinians after Hamas ascended to power and is considering easing restrictions on the movement of goods between Israel and the Gaza Strip, officials said Thursday. (AP Photo/Khalil Hamra) (Khalil Hamra - AP)

NABLUS, West Bank -- Thousands of Hamas followers gathered Friday to donate money and jewelry to their cash-strapped government, while a Western boycott stirred debate inside the militant group over whether to accept a state alongside Israel.

The Hamas-led government has been under increasing economic pressure since taking office in March, with Israel halting $55 million in monthly tax transfers to the Palestinians, and the United States and European Union freezing hundreds of millions of dollars in aid.

Without the money, the Palestinian Authority has been unable to pay its 165,000 workers for the past two months and is having trouble buying medicines and other vital supplies.

In a show of solidarity with Hamas, about 5,000 Palestinians gathered in the northern West Bank city of Nablus to make personal contributions to the government.

Several women put jewelry in a collection plate. A group of gunmen from the Al Aqsa Martyrs' Brigades, affiliated with the Fatah Party, fired rifles in the air before donating $22. The contributions were touted over megaphones, and some people said they were donating their entire paychecks.

"These donations are our way of telling the world that we can live without them, and our children are paying what the Europeans should be paying," said Bassam al-Shaqaa, a former mayor of Nablus.

A telethon, broadcast on television with Hamas officials fielding calls, received pledges from as far as Qatar and Saudi Arabia.

Officials did not say how much money they raised, but it was at most a tiny fraction of the tens of millions of dollars the government needs.

Israel and the West have said they would only deal with Hamas and restore the flow of money if the group recognizes Israel, renounces violence and abides by prior peace agreements.

Hamas leaders have publicly rejected those conditions. But in private, they have debated whether to recognize Israel in an effort to extricate themselves from their economic crisis, according to a moderate Hamas official who spoke on condition of anonymity because of the secret nature of the discussions.

Many Hamas leaders favor recognizing Israel, but Foreign Minister Mahmoud Zahar and the group's top leader, Syria-based Khaled Mashaal, have refused, the official said.

The debate became public with the release of a proposal worked out by top militants, including those from Hamas, imprisoned in Israeli jails. The document calls for the establishment of a Palestinian state on the lands Israel captured in the 1967 Mideast War: the West Bank, Gaza and east Jerusalem.