As the director-general of Strategic Affairs Ministry, Brig.-Gen. (res.) Yossi Kuperwasser has spent a lot of time researching Palestinian incitement against Israel and Jews.

Under his tutelage, the ministry earlier this year published an Incitement Index, which listed numerous examples of statements made by senior Palestinian Authority officials who ostensibly demonized Israel, insulted Jews, marginalized the Holocaust and radiated a general unwillingness for peace and reconciliation.

“The incitement done by the Palestinian Authority is in my mind the main obstacle to peace,” Kuperwasser said when the index was published in August. The document also showed that the PA spends huge sums of its tight budget paying monthly salaries to the families of terrorists and security prisoners.

Earlier this month, Prime Minister Benjamin Netanyahu, after consulting with Finance Minister Yuval Steinitz, ordered the transfer of a NIS 250 million advance from tax revenues collected by Israel to help the PA deal with its mounting economic worries. Angry and at times violent protests had swept through the Palestinian territories as the PA announced it had trouble paying employees’ salaries.

“We are working on several fronts in order to help the Palestinian Authority cope with its economic problems,” Netanyahu said in announcing the tax advance. “Of course, there is a global reality and it is also related to the internal management of every economy, but for our part we are making efforts to help the Palestinian Authority survive this crisis. I hope that it will succeed in doing so; this is our in our common interest.”

Last week, The Times of Israel sat down with Kuperwasser on the sidelines of the annual International Conference of the Institute for Counter-Terrorism at the IDC Herzliya. He answered questions about the apparent stick-and-carrot strategy of the Israeli government — which on one hand chastises the PA for inciting against Israel and on the other hand helps the PA overcome its difficulties — the prospects of a new intifada and his views on allowing Egyptian troops in the Sinai.

The following is an edited version of the conversation.

The last time we spoke, you told me about Palestinian incitement, saying that the PA does nothing but spread hatred against Israel and gives “millions of dollars” to terrorists in monthly salaries. So why is the government so generous now with tax advances?

Because life is complicated, you know. You cannot follow just one line. Anyhow, the money that was transferred was their money. It’s not money that we give them; we just delivered it earlier than was expected. It’s not the first time we do that. We did it before the [Ramadan] holiday as well. We do it because the Authority suffers from a shortage of funds. We want the Authority to change its ways, we want it to stop incitement, to stop demonization of Jews. Two weeks ago, [senior Palestinian official] Jibril Rajoub, for example, called Netanyahu a dog…

It’s not easy to understand, but that’s the complexity we’re living in. On the one hand, we want them to change their behavior, to change their attitudes toward Israel and the Jews and peace and violence. They have a big change to go through. On the other hand, they’re our neighbors. We want them to have stability, we want them to have prosperity. We believe that their prosperity will also, in the long run, help us…

We don’t do the [Incitement] Index on Hamas. If we did it on Hamas, it would be ten times worse. The Fatah-led PA is, relatively speaking, not as terrible as Hamas. We even cooperate with them on security measures and things like that. The picture is complicated and because of that we want them to change their behavior but we don’t want to bring them to the point where they may fall.

Why not? It seems the government is not too fond of the PA leadership right now. Foreign Minister Avigdor Liberman, for example, keeps on saying that Abbas needs to go.

But here we’re dealing with the salaries of the people. We didn’t give 250 million to Abu Mazen [Abbas]‘s pockets. We’re giving it to the people. So bearing in mind the complexity of the situation, it’s reasonable to do something like that, with all the reservations one has about it. And we do have reservations. We feel a little bit frustrated that we’re giving the money to somebody who is at the same time insulting us, calling us names and doing all kinds of things that are totally unacceptable. They’re even still considering going for a unilateral move to the UN [to ask the General Assembly for the status of a nonmember state next week].

It’s a very complicated situation. But at the end of the day, the guy who gives permits for cars in Nablus and gets paid by the Authority, if he reaches a point where he just doesn’t have money because the Authority doesn’t have money, we would help. At the same time, I think that the international community and the people of the PA should expect their leadership to be much more efficient, much less corrupt and to do whatever is necessary to make sure they’re not going to repeat this episde every second day.

Is Israel advancing the tax revenue because we don’t want the economic protests in the Palestinian territories to turn against us?

No. It’s not going against us…

Palestinians chant slogans against Prime Minister Salam Fayyad while protesting the high cost of living in the West Bank city of Hebron, September 10, 2012. (photo credit: Nasser Shiyoukhi/AP)

Palestinians chant slogans against Prime Minister Salam Fayyad while protesting the high cost of living in the West Bank city of Hebron, September 10, 2012. (photo credit: Nasser Shiyoukhi/AP)

We saw violent demonstrations in the Palestinian territories. Isn’t the government afraid that this anger is going to turn against “the occupation”?

That wasn’t the case in the last round [of demonstrations]. Here and there, on a very low level. It was an internal issue.

What are the chances that this might turn against Israel, that the PA will blame Israeli government for its inability to pay salaries on time?

They always say that but nobody believes them. The fact is that the public didn’t buy it.

So there’s no new intifada in sight?

There was no intifada toward us, the intifada was toward them.

But can that situation change?

It can change, but it’s not that easy.

So how do you evaluate the risk of the Palestinian anger turning against Israel?

I cannot say exactly what is the level of the risk. There is such a risk, I am not saying there is no risk… We’re all worried… It’s dangerous but it’s not against us. This time, the population is upset with their leadership. It’s not directed toward us. When they try to divert the attention toward us, they fail. Nobody comes to Bil’in, to Na’alin, nobody comes to all of these orchestrated [demonstrations against Israel and the separation fence].

These demonstrations are mainly for Europeans, usually very few Palestinians attend. But now you have enraged Palestinians taking to the streets. Isn’t it easy for the leaders of the PA to divert all the hatred you say they are feeding the population with against Israel?

It’s not that easy. Because it’s not the only thing that happens inside the PA. There are other things. There’s a lot of agitation against the leadership of the PA. Look at what Muhammad Rashid [a close confidante of late Palestinian leader Yasser Arafat who is now accused of embezzlement], says in a variety [of news outlets]. People understand. People are not that stupid. They listened to the incitement; it has an impact. But at the same time they also look around and see that the money comes in and disappears. And it comes in, and it disappears again. It comes in for a third time and still disappears. And nobody knows where the money goes. So people are asking themselves: where is the money?

You’re talking about corruption.

Corruption, yes, and nepotism, all these things are concerning them. Don’t take me as somebody who is complacent about the possibility of the direction changing. I’m not; we’re worried about it. [But] I’m more worried that more pressure is going to be put on them [the PA leadership] and that there is going to be an implosion — a collapse inside.

What’s your contingency plan for that scenario?

I’m saying that even though I am worried about that, this is also something I don’t think is going to happen right now. But, in order to avoid this from happening, this money is being transferred. To help them confront this challenge.

Would you say Iran is a bigger threat than a new Palestinian uprising?

It’s a different kind of threat. There’s no competition. The problem that we have is that we have a plate full of threats and problems and challenges, and even though some of them are interdependent, each one by itself is a big headache. We cannot say that because we’re busy with Iran, we should neglect the Palestinians, or something like that. No — we have to cope on all fronts simultaneously.

What about the Paris Protocols [which regulate Israeli-Palestinian economic relations and were signed as an addendum to the Oslo Accords]? The Palestinian government and the people on the street are demanding that Israel reopen them.

They don’t even know the meaning of it. In my mind, none of them has ever read the Paris Protocols, which are pretty long. They have some idea: the Paris Protocols are putting us and the Palestinians under the same tax rates. It’s true, but this is the reality of this economy. This is one economy.

‘The Paris Protocols are good for the Palestinians. If they weren’t good for the Palestinians, they wouldn’t have signed them in the first place’

Does Israel refuse to discuss this because the government believes that changing the protocols would not help solve the Palestinians’ financial crisis?

We never refuse to discuss anything. We’re always ready to discuss everything. And we’ve just conducted long discussions with the Palestinians about changes in the Paris Protocol, and just concluded an agreement with them that changes the Paris Protocols a little bit on the question of tariffs and taxes.

[Kuperwasser is referring to a agreement on taxation and the transfer of goods between Israel and the PA, which Steinitz and PA Prime Minister Salaam Fayyad signed on July 31.]

So why do the Palestinians want to change it again?

They want to shout. These guys who shouted about the Paris Protocols don’t even know what they’re saying. They never read the protocols… I don’t think they really want to change them. It’s a slogan.

You think that even Fayyad is not really interested in changing the Paris Protocols?

They asked [PA Civil Affairs Minister] Hussein al-Sheikh to tell us that they want to discuss the Paris Protocols. First of all, let’s see what exactly he wants. If he does really want it. Basically, the Paris Protocols are good for the Palestinians. It’s not something that is bad for them. If they weren’t good for the Palestinians, they wouldn’t have signed them in the first place.

But that was a long time ago [in 1994].

The Palestinians weren’t forced to sign them. The Protocols were an outcome of discussions, which they accepted. The problem is that the concept that you can always open an agreement is wrong. Agreements are being signed to [constitute] a pillar to which you can refer when there are problems, and change them constantly.

That’s a good transition into my next question. Let’s talk about Egypt. President Mohammed Morsi recently sent troops to the Sinai to rid the peninsula of terrorism. Some Israelis weren’t so happy about allowing Egypt to violate the terms of the Camp David Accords. Others disagreed, saying that it’s for a good cause. What’s your take on Egyptian troops in the Sinai?

We don’t speak about this issue. We don’t turn a blind eye but we don’t speak about this issue.

Army trucks carry Egyptian military tanks in Egypt's northern Sinai Peninsula, Thursday, Aug. 9, 2012. (photo credit:AP)

Army trucks carry Egyptian military tanks in Egypt’s northern Sinai Peninsula, Thursday, Aug. 9, 2012. (photo credit:AP)

If Morsi were allowed to do in the Sinai what he needs to do in order to deal with the terrorists there, do you think he would get the job done?

I don’t know. Which is not necessarily yes.

Is it dangerous for Israel to have Egyptian tanks in places where they shouldn’t be?

Basically yes. That’s what an agreement is for. Because once you put one tank — what do you care about one tank? So you put two tanks. Two tanks? And so on and so forth, there’s no end to it. If there’s an agreement it should be kept.