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Unfurling flags, loosing balloons and letting off some steam, medium-size Palestinian crowds greeted their leader Yassir Arafat and the onset of the third year of the Palestinian-Israeli war of attrition that he launched after not getting everything he wanted at the bargaining table.

However, it was a bittersweet moment for Arafat and the crowds who celebrated the lifting of the two-week Israeli siege of Arafat–a small diplomatic victory–amid a scene of growing poverty and dwindling hopes for most Palestinians.

Flashing his customary “V for victory” sign, a triumphant Arafat emerged from his headquarters in Ramallah that had recently been re-designed by Israeli army decorators from a 20-building compound to a five-room hovel. The shaky septuagenarian declared his victory over Israel, which removed the siege at the request of the United States.

“We are not concerned about the siege, and our revolution will be victorious,” declared Arafat, his lips and hands trembling visibly.

“They are trying to deceive the world,” he added, referring to the fact that Israel was keeping its troops not far from his office.

But it would be fair to say that Arafat had won a small victory at least, by forcing the Israeli Government not only to remove the siege, but also by forcing the government of Prime Minister Ariel Sharon to give up, once again, on its demand for extradition for trial in Israel of Palestinian terrorists.

Security officials said that more than 40 of the 250 people around Arafat were “wanted men” with active involvement in terror attacks.

Many Israeli journalists and opposition politicians said it was a big failure for the Sharon Government, but it is likely to be remembered in three other ways:
*–a minor setback for Israeli diplomacy in service to American goals of preparing a coalition against Iraq;
*–another example of Arafat escaping immediate expulsion or death as he spirals downward as a lessening influence in Palestinian life;
*–a further example of an on-again-off-again-on-again-off-again Israeli policy of shooting from the lip and the hip in a manner that even top Israeli army officers called a mixture of helter-skelter and seat-of-the-pants.

“It’s not a great moment,” acknowledged Brig. Gen. (Res.) Efraim Eitam, the right-wing Infrastructure Minister, “but,” he added, “there will be plenty more opportunities to deal with Arafat. Right now the important thing is not to interfere with America’s and the world’s battle against Iraq.”

The siege of Arafat’s headquarters–the third of its kind in six months–had come after an Arab terror strike in Tel Aviv murdered six Israelis, along with four other terror attacks that Arafat’s Palestinian Authority (PA) made no effort to thwart.

Indeed, the PA has issued no direct condemnation of HAMAS or Islamic Jihad for their attacks, and it has likewise actually continued aiding the FATAH movement of Arafat which itself has committed most of the 200 attacks and attempted attacks by suicide bombers in the last two years.

Some of Arafat’s closest aides reiterated that the Palestinians would continue their armed struggle, despite signed agreements with Israel.

“We have no choice but to be steadfast to win back all the occupied land,” asserted PA Cabinet Secretary Ahmad Abdul-Rahman.

Arafat’s own newspaper, Al-Hayat Al-Jadida, showed a huge picture of Arafat wearing the checkered kaffiya head-dress, taking over Israel–as well as the West Bank and Gaza.

Other Palestinian newspapers featured front-page pictures of demonstrators supporting Arafat (including the Palestinian daily Al-Quds which chose to show a crowd in London, perhaps because it was a better crowd).

Elsewhere, the Palestinian press continued to heap scorn on the U.S., even though it was U.S. pressure that had gotten Arafat’s release.

A cartoon in Al-Quds showed a perplexing problem facing an American trying to take aim against Saddam without hitting an oil barrel atop his head (marked Arab oil in the cartoon).