Wars and Military Conflicts

Possible Gaza sticking point: Hamas' payroll


Israeli troops and Hamas gunmen are battling in Gaza for a sixth straight day, but before that fighting can come to an end, Hamas may need to address a problem that doesn't involve religion or ideology but something much more mundane: its payroll.

Israeli soldiers ride on an armored personnel carrier outside the Gaza Strip.
Nir Elias | Reuters

Ground troops from Israel are trying to destroy rocket launchers and tunnel networks that Hamas uses to infiltrate Israel and carry out attacks. The fighting has left Gaza civilians caught in the combat and Israeli citizens under perpetual threat. At the same time, a new round of ceasefire talks is on in Egypt after previous attempts failed.

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A main sticking point—and perhaps one reason this month's fighting started at all—is financial. Hamas, the Islamic foundation that runs the Gaza Strip, ran out of money three months ago, leaving 40,000 civil servants without a paycheck. Most of those workers are in Hamas' police force. The organization, which the U.S. State Department classifies as a terrorist group, has lost a great deal of its funding, particularly since the Egyptian military took control of the government in that country.

"Hamas lost the support of Syria, they lost the attention of Iran...and they lost their ideological twin in Egypt, the Islamic Brotherhood," Israeli New York Consul General Ido Aharoni told CNBC.

If payments to those 40,000 Hamas employees are not resolved, the fighting could easily start again in a matter of weeks.
Matt Levitt
The Washington Institute for Near East Peace

Hamas reached a deal with the Palestinian Authority to form a unity government June 2, but because they were negotiating from a position of financial and political weakness, none of their conditions were met, including demands that the Palestinian Authority should pay the salaries of those 40,000 civil servants.

One former deputy assistant secretary for intelligence at the U.S. Treasury Department told CNBC that the money issue is one of the main reasons the fighting began in the first place.

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Hamas wants three main things in order to bring about a resumption of the 2012 ceasefire, and only one is related to Israel, said Matt Levitt, now at The Washington Institute for Near East Peace. They want members released from Israeli jails, they want Egypt to open its border crossing with Gaza, and they want Egypt to facilitate payments to the civil servants.

Levitt said "Egypt is enjoying not fulfilling Hamas' demands," especially after the group rejected an Egyptian plan for a ceasefire last week.

Israel's objectives & dilemma

But the payroll problem is one that probably needs to be remedied in order for any sort of lasting ceasefire to come about.

"If payments to those 40,000 Hamas employees are not resolved," Levitt said, "the fighting could easily start again in a matter of weeks."

An Israeli official in that country's Foreign Ministry, who requested anonymity, told CNBC that "in Hamas' logic, they had no choice but to attack and start a war. In their eyes, how else could they get attention for their concerns? This restored their relevancy and put the issue of payments back on the table."

Doha, Qatar.
Getty Images

Qatar has said that it would fund those 40,000 employees, but facilitating the transfer of money is complicated due to international sanctions targeting Hamas.

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