This record is a partial extract of the original cable. The full text of the original cable is not available.

C O N F I D E N T I A L SECTION 01 OF 03 TEL AVIV 001754 
 
SIPDIS 
 
E.O. 12958: DECL: 05/04/2016 
TAGS: PREL PGOV EAID KWBG IS ISRAELI PALESTINIAN AFFAIRS GOI EXTERNAL
SUBJECT: DAGAN AND CODEL LIEBERMAN DISCUSS HAMAS-LED PA AND 
IRAN 
 
Classified By: Ambassador Richard H. Jones for reasons 1.4 (b) and (d) 
 
¶1.  (C) Summary:  Meir Dagan, director of the Mossad, told 
Codel Lieberman on April 20 that Hamas won the Palestinian 
elections because it was more united and organized than 
Fatah.  He said that Palestinians mainly voted for Hamas to 
protest Fatah corruption, but added that 60 percent "still 
back guns."  Dagan described the Hamas's four main sources of 
funding, as well as its connection to the Muslim Brotherhood. 
 He claimed that Hamas would never change its basic 
philosophy against Israel, even if it can be practical and 
change its rhetoric.  Dagan advised against channeling U.S. 
assistance to Palestinian Authority (PA) President Mahmud 
Abbas's Presidential Guard, however, because he claimed that 
Abbas would use it to buy influence in other security 
services under the Hamas-led government, rather than on his 
own Presidential Guard.  He suggested that U.S. assistance go 
to humanitarian needs instead because "the security services 
can get their salary anywhere," explaining that the PA has 
enough money in the Palestinian Investment Fund, and 
donations from Iran and Qatar, to last approximately six 
months.  Dagan said that when the PA is bankrupt by the end 
of the year, "maybe Jordan or Saudi Arabia could help the 
Palestinian community through Fayyad," but he did not 
elaborate on this concept.  Moving on to Iran, Dagan said 
that the international community must plan a coordinated 
effort, which includes inflicting effective sanctions on Iran 
through the UNSC, preventing proliferation, "damaging the 
(nuclear) project," and undermining the regime.  He claimed 
that Iran will have the military capability to deliver a 
nuclear weapon in 2-3 years.  End summary. 
 
--------------------- 
Palestinian Elections 
--------------------- 
 
¶2.  (C) Meir Dagan, director of the Mossad, told Codel 
Lieberman on April 20 that the Israeli intelligence community 
thought that the Palestinian elections would result in a 
"close tie," but later realized that Fatah would not win when 
it analyzed the results of the municipal elections.  He said 
that Hamas' victory was not clear-cut, however, because Fatah 
candidates received more votes, but lost because Hamas was 
more organized and united.  He assessed that those who voted 
for Hamas want to bring an end to corruption.  Senator 
Lieberman agreed, informing Dagan he had met with Palestinian 
Authority (PA) President Mahmud Abbas and Chief Negotiator 
Saeb Erekat, and both said that corruption and social 
services were the most important factors in determining for 
whom Palestinians voted.  Dagan responded that even if 
Palestinians voted for Hamas to tackle the corruption issue 
in the PA, they knew it would also result in a change in 
Palestinians' foreign policy.  He claimed that Palestinians 
continue to support armed struggle, and said that Khalil 
Shikaki's polls show that despite showing support for 
negotiations with Israel, 60 percent of those polled "still 
back guns." 
 
-------------------------- 
Sources of Funds for Hamas 
-------------------------- 
 
¶3.  (C) In response to the Senator's question, Dagan replied 
that Israeli intelligence identifies four funding sources for 
Hamas.  The most significant is internal "zakat," or 
donations by Palestinians in the West Bank and Gaza Strip. 
He continued that "a great deal" comes from the Gulf states 
through private donations by individuals.  The third largest 
source of funds originates from Iran, which is now Hamas's 
only state supporter, according to Dagan.  The fourth most 
significant source is non-governmental organizations in 
Europe and the U.S., "even though the Al-Aqsa Fund is 
closed."  Dagan acknowledged that most people who donate do 
not do so "for terrorism, even in the Gulf," but he said that 
their charity is diverted to the military wing once it 
reaches Hamas's hands. 
 
-------------------------------- 
Hamas and the Muslim Brotherhood 
-------------------------------- 
 
¶4.  (C) Dagan added that Hamas's links to the Muslim 
Brotherhood (MB) are clear.  He claimed that the people who 
collect funds are the same for both organizations, 
particularly in NGOs.  He cited the example of an individual 
who was part of the MB in Egypt, was expelled to Qatar, and 
now chairs the Allah Fund to collect money for Hamas.  "They 
are more connected than people realize," Dagan said.  Senator 
Lieberman asked whether Hamas would change its policies 
toward Israel, given that it is part of the greater MB 
movement, and Dagan replied that there is no chance Hamas 
will change its basic philosophy.  He said the group's 
leaders may pay lip service to agreements and change their 
rhetoric, but ultimately they will not change their 
philosophy.  He commented that Hamas may say it backs the 
Saudi initiative, but without clearly recognizing it.  He 
concluded that Hamas will be practical, but will not give up 
its ideology. 
 
¶5.  (C) According to Dagan, members of the MB in Egypt and 
Jordan are extremely pleased with the Palestinian election 
results, and hope they can copy Hamas' success in the 
governments of their own countries.  Senator Lieberman asked 
whether the Egyptian and Jordanian governments want Hamas to 
fail, and Dagan replied that while Egypt privately 
acknowledges Hamas is a problem, it encourages and supports 
the group in public despite the fact that Hamas does not 
accept Israel.  He added, however, that Egyptian Intelligence 
Chief Omar Soliman "knows the real picture, and it's not 
flattering."  Dagan remarked that there is no difference in 
Jordan's public and private comments regarding Hamas because 
it knows "Hamas is a major threat for them," and it is 
willing to undertake stronger measures against the group. 
 
-------------------- 
Assistance to the PA 
-------------------- 
 
¶6.  (C) Senator Lieberman told Dagan that Abbas had asked him 
for U.S. support for the President's Office and the 
Presidential Guard, whether financial support or training 
assistance.  He asked Dagan if this seemed reasonable, and 
Dagan responded that Abbas is not strong, and will quickly 
surrender if pressured by Hamas.  He said that most of the 
security is under the Hamas-led government.  Abbas's 
Presidential Guard is not effective because it is comprised 
of people who were loyal to Yasir Arafat, and Abbas has not 
been able to put in his own people to take control.  Dagan 
assessed that for this reason, any assistance Abbas receives 
will go to buying influence in other security services under 
the Hamas-led government, rather than to his own Presidential 
Guard. 
 
¶7.  (C) Dagan advised channeling U.S. assistance to 
humanitarian needs and added that "the security services can 
get their salary anywhere."  He explained that the 
Palestinian Investment Fund (PIF) is worth $500 million, 
claimed that the PA will get $100 million from Iran and $50 
million from Qatar, and declared that these funds would carry 
the PA through for 6-7 months.  (Note:  Dagan did not give a 
timeframe for when the PA would receive the funds from Iran 
and Qatar.  End note.)  He related that Abbas has a special 
relationship with Qatar because his son frequently visits, 
implying that this is the reason why Qatar is willing to 
donate to the PA, and added that Muhammad Rashid set up the 
PIF to control profits from the tobacco and cement 
monopolies.  When Salam Fayyad took over as finance minister, 
he took control of the PIF, so it is now under the Finance 
Ministry, which Hamas runs, according to Dagan.  The 
Ambassador pointed out that half of the PIF's assets are 
collateralized for loans, and Dagan said, "but they still 
have it."  He said that Hamas has its "own agenda" regarding 
security services salaries.  He noted that the PA spends 
approximately $90 million per month on salaries, but if Hamas 
does not have the funds, it can say that it is unable to pay, 
and that it must cut the ranks by 20,000 soldiers.  The group 
can then hire its own members into the security services for 
less. 
 
¶8.  (C) Senator Lieberman asked what would happen in six 
months when the PA runs out of money.  Dagan replied that the 
PIF would be spent by then, and that it is unlikely that Iran 
would continue to provide $100 million per month 
indefinitely, so the PA will be bankrupt by the end of the 
year.  He continued that whoever can bring in the funds at 
that point would be the person controlling the government. 
Dagan predicted that the Palestinians would turn to the EU, 
and would ask Israel for the frozen revenues, but Dagan said 
that he was not sure Israel would transfer the funds.  He 
claimed that Israel is "not trying to create a crisis," and 
added that the GOI would look for ways to help the 
Palestinian community.  Dagan continued that Abbas could call 
new elections if Hamas is unable to pay any government 
salaries, but asked rhetorically whether he is brave enough 
to do so.  Dagan offered that he would not channel any funds 
through Abbas, and remarked that "maybe Jordan or Saudi 
Arabia could help the Palestinian community through Fayyad." 
He did not elaborate on this concept, but reiterated that no 
funds should be channeled through Abbas because he will use 
it to pay the salaries of Fatah members, and "Hamas will 
eventually profit." 
 
---- 
Iran 
---- 
 
¶9.  (C) Moving on to Iran, Senator Lieberman told Dagan that 
the U.S. is very concerned about Iran's nuclear program and 
the country's current leadership.  Dagan said that Iranian 
President Ahmadinejad is openly presenting the opinions of 
Iran's religious leaders, and that what he is saying is 
"nothing new."  He said Khatami and Rafsanjani held the same 
beliefs, but "both had a better face."  Dagan said he 
believes that Ahmadinejad means what he says, and added that 
this makes Iran a threat not just for Israel, but for 
everything the U.S. is trying to accomplish in Iraq.  He 
claimed that the Shia community in Iraq is following 
guidelines from Iran. 
 
---------------------------- 
International Community Must 
Impose Sanctions 
---------------------------- 
 
¶10.  (C) Dagan advised taking Iran to the U.N. Security 
Council, and "hitting it hard with sanctions."  He explained 
that the Iranian political system is dependent on public 
opinion, and that the public can turn against the government 
if it suffers sanctions.  Dagan commented that the 
international community should try to "use all of its 
diplomatic weapons now" before resorting to military attacks. 
 He said that China is unlikely to veto sanctions against 
Iran because it cannot go against world opinion, even if it 
is dependent on Iran for oil.  He added that Russia will be 
cornered because Iran will not accept its proposal not to 
enrich uranium. 
 
¶11.  (C) Senator Lieberman asked whether the U.S. should 
encourage a change of government.  Dagan replied that until 
now, no government has undertaken a serious effort to change 
the ruling regime, and added that this cannot happen 
overnight and requires significant cooperation from many 
different groups, such as the Azeri, Kurdish, and Mujahideen 
opposition in Iran.  Dagan commented that "we need to sit and 
form a plan so we can achieve mid-term goals to mold the 
regime."  He explained that the Iranian government needs to 
understand that it will pay a price for supporting terrorism, 
and said that "sanctions now don't hurt a lot."  He noted 
that there is a "long list of things that could be done to 
create serious problems," but remarked that the intelligence 
communities in Israel and the U.S. need political directives. 
 Dagan characterized his policy in four pillars: 
 
-- inflicting effective sanctions through the UNSC. 
 
-- preventing proliferation. 
 
-- "damaging the (nuclear) project." 
 
-- undermining the regime. 
 
He added that "talking about a military strike" creates a lot 
of debate in Iran, and that this is good for the 
psychological impact.  Senator Lieberman said that the media 
will always focus on this even if it is the last thing the 
U.S. wants to do. 
 
¶12.  (C) Dagan continued that Iran could take 1.5 years to 
work on centrifuges, and on a separate track focus on the 
launching systems for a nuclear missile.  He said that with 
these two tracks put together, Iran could have a military 
capability to deliver a weapon in 2-3 years, and is working 
hard in this direction.  He said the Shihab-3 missile has a 
range of 1,500 kilometers and can currently carry nuclear 
material, and reported that Iran is also trying to adapt the 
BM-25 missile, which already has a longer range, for this 
purpose.  He commented that Iran bought a few cruise missiles 
from Ukraine, and is reverse-engineering them now.  Senator 
Lieberman said that the U.S. and Israel will not be the only 
targets because Iran will be able to reach Sunni oil states, 
at least for blackmail.  Dagan agreed that having a nuclear 
weapon improves Iran's bargaining position, and gives it a 
unique capability. 
 
¶13.  (U) CODEL Lieberman has cleared this cable. 
 
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