By Scott Wilson
Washington Post Foreign Service
Wednesday, September 13, 2006; A12

RAMALLAH, West Bank -- As the young editor of Hamas's weekly newspaper, Sari Orabi is a careful monitor of what he describes as the "surprisingly frank" debate underway within the party that took control of the Palestinian Authority just over five months ago.

Orabi, sporting blue jeans and bristling hair, said he was among those who argued that the radical Islamic movement should not compete in last January's parliamentary elections, fearing victory would bring sanctions from Israel and international donors that classify Hamas as a terrorist organization.

That prediction has proved true, bankrupting the authority and raising questions within party ranks over whether the government Hamas won the right to run is worth maintaining at all.

"The situation we face is proof that the Palestinian Authority under the occupation is an illusion," Orabi, 26, said recently over tea in an office smashed earlier this year by rampaging members of the security services controlled by the rival Fatah movement. "What is the reason behind this authority? A majority now says it is all a big lie."

Created a dozen years ago to administer the occupied Palestinian territories, the frail political system called the Palestinian Authority is now broke, paralyzed by months of partisan infighting and depleted by Israeli arrests. A growing number of Palestinians -- a group that has expanded in recent months from a core of secular intellectuals to include officials from the leading political movements -- have begun advocating openly for the authority's dissolution.

Prime Minister Ismail Haniyeh of Hamas, facing a strike by civil servants over unpaid wages, agreed this week to form a power-sharing government with Fatah and other factions in hopes of restoring international aid. Whether a new government will revive foreign financial support, which accounts for nearly half the authority's budget, could help determine whether the authority itself remains viable in the face of mounting unrest and disillusion in the territories.

The unity government platform would commit Hamas to accept past agreements signed by the Palestine Liberation Organization that recognize Israel. It would mark the first time that Hamas, which does not belong to the PLO and has long opposed the 1993 Oslo peace accords that created the Palestinian Authority, would tacitly accept a two-state solution to the conflict.

But Hamas has so far refused to renounce violence or explicitly recognize the Jewish state -- two of the three conditions set by the United States, the United Nations, Russia and the European Union for a renewal of aid. Israeli officials indicated Tuesday that Israel would not release hundreds of millions of dollars in frozen tax revenue it collects on behalf of the Palestinian Authority or support an easing of international sanctions against it unless those terms were met.

The result could doom the new coalition government, slated to be headed by Haniyeh, before it takes shape. And failing to win international support after compromising is likely to inflame Hamas activists, some of whom have argued for months that collapsing the authority is preferable to giving up power won in fair elections.

"When you have an authority that is utterly powerless, what do you expect the reaction from the public will be?" said Ali Jarbawi, a professor at Bir Zeit University near Ramallah, who broached the idea of dissolving the Palestinian Authority three years ago in a series of influential journal articles. "More and more people are saying, 'If you can't deliver, you shouldn't exist.' "

Dissolving the Palestinian Authority, once envisioned as the embryo of a future Palestinian state's government, has until now been largely a topic of intellectual debate among professors, U.S.-educated lawyers for the Palestine Liberation Organization and disaffected members of the leading parties.

But the idea has reached further into the political mainstream over a difficult summer during which the authority has lost support among its two chief constituencies: Fatah, which dominated the government for years until its election loss to Hamas, and public employees who have gone months without paychecks. An estimated 1 million Palestinians in the West Bank and the Gaza Strip depend on authority salaries for their livelihoods.

Jarbawi and others argue that the authority has taken the brunt of the blame for Palestinian political, economic and security failures, even though Israel, through its military presence, border controls and financial ties, remains the decisive power in the territories.

Without the authority, Jarbawi and others contend, Israel would be forced to assume a far greater political and financial role in the territories, taking responsibility for health, education and other services under international law that govern occupation. The Israeli investment could total billions of dollars annually and bring new pressure on the Jewish state to sign a comprehensive peace agreement with the Palestinians.

The authority "was supposed to be a vehicle for the establishment of a Palestinian state, but today the situation is not logical and we alone are paying the price of the occupation," said Hassan Khreisheh, a deputy speaker of the Hamas-controlled parliament who proposed dissolving the Palestinian Authority in a legislative session last month following a 26-day stint in an Israeli jail for belonging to an illegal organization. "The Israeli occupation should be paying for education, health and the administration, while the Palestinian cause should be brought back into the hands of the international community."

Following Hamas's election victory in January, the movement and its allies had remained publicly committed to the authority. But Orabi said elements within Hamas are growing more radical as their government continues to falter under economic sanctions and Israeli pressure. More than 30 Hamas members of parliament, including the speaker and five cabinet ministers, were detained and remain in Israeli custody since the June 25 capture of Israeli army Cpl. Gilad Shalit by gunmen from the movement's military wing. Israel has made Shalit's release a condition for unfreezing the tax revenue.

Ghazi Hamad, a Hamas official and adviser to Haniyeh, warned of radicalization in a scathing critique of Palestinian disunity and his own party's mistakes published last month by the Palestinian newspaper al-Ayyam.

"We have lost the connection between the resistance and other aspects of life," Hamad wrote, referring to armed confrontation with Israel. "There is an abyss between the resistance, politics and the people. That is why the people are scattered, not unified, not organized."

The authority is also losing legitimacy inside the ranks of Fatah, whose members fill out much of the civil service.

Some of Fatah's young guard, disillusioned by the older generation's corrupt and incompetent leadership, quietly advocated the authority's abolishment when the party was in charge. Hamas officials contend that their rivals began advocating the approach more boldly after losing their hold on the Palestinian ministries, long a source of patronage and power.

"The only justification for this authority was to pay employees, and now that it cannot even do that, there is no reason for it at all," said Tayseer Nasrallah, 45, a Fatah leader from Nablus who is working on a project to reform his party. "The voices for the authority's dissolution are rising inside the party. We need to make a dramatic gesture to force the world to really look for a just solution to this crisis, or we will go back to the occupation run entirely by Israel."

Qaddura Faris, 44, a former minister and a powerful figure within Fatah's young guard, favored dissolving the authority when Palestinian leader Yasser Arafat was still alive. But Faris does not believe that authority President Mahmoud Abbas, who succeeded Arafat after his death in November 2004, has the power to govern without the government's institutions. Faris and others say the possible alternatives to the authority, which could include returning to the Israeli occupation that existed before Oslo or perhaps a civil administration by Jordan, are worse.

"If it happened now, we would be left without an umbrella," said Faris, who acknowledged that young Fatah activists are behind the civil servants' strike to pressure Hamas to cede control of the cabinet. "But there is also this impression that if we can form a national unity government, everything will be okay. I don't believe that either."