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The CIA believes Israel's Prime Minister Ariel Sharon has decided to launch a retaliatory full-scale attack on Palestinian-controlled territory if there is another suicide bombing attack, according to Richard Sale of the UPI on 20 July. "There's no question that he's going in," said a former CIA official, referring to Sharon. The question for these sources was 'when.' According to these sources, Palestinian Authority President Yasser Arafat was already engaged in talks with Syria about relocating Palestinian leaders to that country.
One former CIA official, still active in the region, said he believed that Sharon would wait for the next in the recent wave of car-bomb attacks before launching "a full-scale assault" designed to drive Arafat into exile and destroy the PA. "You'll have public outrage, you'll have high morale among the Israeli military -- it's the perfect time," the official said.
Reports of an impending all-out Israeli attack have come as relations have worsened between the Israeli government and the CIA. CIA Director George Tenet negotiated the cease-fire aimed at halting the seemingly endless violence in the West Bank and Gaza. The CIA has been at the center of the Bush administration's efforts to stop the fighting between Palestinians and the Israeli Defense Forces that has claimed more than 600 lives, most of them Palestinians. But the cease-fire has all but collapsed, and observers point out that its collapse could be seen as a CIA failure.
A State Department official said, "The situation does not look good," and "We are all watching it," but he would not go so far as to confirm the impending attack. He also added that the Hadassah chain of hospitals in Israel "has been ratcheting up" its medical preparations.
UPI reported on 12 June that Israel's military was poised to carry out a huge, full-force invasion that would involve two infantry and paratroop divisions, an armored force, plus large numbers of U.S.-supplied F-16 and F-15 jet fighters and Apache helicopter gunships that would attack the West Bank and Gaza including the major Palestinian cities of Ramallah, Qualqilya, Jericho, Tul karm, Nablus, Jenin, and Bethlehem. Portions of the West Bank and the Gaza Strip would be captured and held for an indeterminate length of time.
Under that plan, the Israeli forces would also capture and kill any members of Hamas, Hezbollah, the Islamic Jihad or other organizations defined by Israel as "terrorist." A "wanted list" has already been drawn up by Israeli intelligence services and approved by Sharon, according to a U.S. administration official.
At the time the plan was halted, thanks to strong warnings from senior Bush administration officials, U.S. government sources said. There was no official confirmation of this incident.
What worries some U.S. intelligence analysts is that, as one put it, "all the logistic and other preparations" for such an assault have been completed, including beefing up Israeli medical treatment facilities. Others argue that the Israeli contingency plan has been in place for some time as an option if the situation worsened. "The plan is in place," a U.S. intelligence official said.
There has been a build-up of Israeli armor at strategic points, and the Sharon government has ploughed up road links to the West Bank, splitting the territory into eight blockaded zones, isolating Palestinian towns, and fuel supplies in the Gaza Strip have been cut off to reduce Palestinian mobility.
The huge numbers of Palestinians expected to be arrested would be kept in large detention centers, U.S. intelligence officials said.

An administration official pointed out that Sharon has been "churning out a lot of diversionary smoke," including false reports of Iranian soldiers moving into the Bekaa Valley in Lebanon, fear of Iranian missiles, questionable reports of increasing Iraqi activity. "Sharon is a fine strategist. He knows how to mislead and distract," said an administration official.

A former Defense Intelligence Agency official, on the ground in the Gaza Strip, told UPI on June 27 that Israeli Merkava tanks and M113 armored personnel carriers were active around Netsarim and Khan Yunis, and that "roads around settlements have been completely cut off from Palestinian use while buildings, trees, and people have been moved (bulldozed) as the Israelis clear fields of fire."

He added, "Israeli assassinations/abductions in Area A (the West Bank and Gaza) have taken the rug out from under PA efforts, limited as they may be in real capability, to keep the violence down or limited to 1967 borders."

This source added in the same report that Hebron, which contains 500,000 people, is ringed by Israeli settlements and IDF outposts and spoke of OH58 Scout helicopters overhead.

Meanwhile both Israeli and US officials rejected on 20 July the deployment of international peace monitors. The Palestinian Authority has for months asked that monitors be placed in the West Bank, arguing they are needed to protect Palestinian civilians from Israeli troops.

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