While Talks Drag On, Israel Builds

Gerry Farkas is going through the numbers. With them, the real-estate agent and resident in this Jewish settlement near Bethlehem can explain why an Israeli looking for a new home in the Jerusalem area won't find a better deal than here.

"It's $136,000 for a two-bedroom apartment. That's almost half the cost of the same apartment in the center of Jerusalem. And the interest on the mortgage is lower," Mr. Farkas says. Roadside billboards and flyers aimed at attracting new buyers say mortgages start at $48,000, including a government grant of $14,000.

With its large houses, flowery landscapes, and majestic views of the West Bank mountains, Efrat and Jewish settlements like it are a tempting option for Israeli homebuyers. At just a 15-minute drive from jobs in Jerusalem, demand is high: Farkas has seen 50 families in the last five days.

But he says people aren't coming because of government grants - a controversial feature of Israeli settlements that Palestinians say violates the Oslo peace accords.

"What brings people here is quality of life," he says from his sales trailer perched on a hill in one of the newest sections of Efrat. In addition to the empty homes waiting to be moved into and others under construction, the settlement plans to build 800 units in the next five to seven years.

But the Israelis - who resumed negotiations with the Palestinians this week in Washington amid dimming prospects for a peace breakthrough - have said they may yield to American urgings to call a "time out" on settlement building. Israeli officials suggest that would mean a temporary pause in the construction of new settlement housing in exchange for a Palestinian agreement to postpone Israel's overdue troop withdrawals in the West Bank.

Settlers oppose a building freeze

Such a compromise plan, even if reached, could be a recipe for another crisis. Israeli settlers, who hold great sway in Prime Minister Benjamin Netanyahu's government, are vehemently opposed to any pause in building and seem determined to continue expanding. So much new building has been authorized in the year and a half since Mr. Netanyahu came to power that almost every settlement has some kind of expansion under way.

Israeli officials have declined to define what will be called settlement activity in progress - whether it will include only buildings under construction or also plans that have been approved on paper. Palestinian leaders say the sight of bulldozers at work and new neighborhoods continuing to go up is sure to persuade skeptical Palestinians that any freeze is a farce.

As hopes for a US-brokered compromise plan dwindle, and stagnation makes locals scoff at the term peace "process," Israelis and Palestinians are waging a plot-by-plot land battle to enlarge and fortify what they have before diplomacy forces them to give it up. Israeli settlements are expanding, but there is also an Arab building boom, especially near East Jerusalem, which Palestinians hope will be the capital of the separate state they want to establish.

The latest talk of freezing new housing in Israeli settlements infuriates real estate agent Farkas, a California native.

"It's not going to happen. The point is that Jews have a right to live in the land of Israel," he says. "Not one inch of this is Arab land. See that?" he says, pointing to a few empty hilltops north of Efrat. "My children and my grandchildren are going to be living on those hills."

But he's not the only one who wants to have his sons and daughters make their homes here.

From his sales trailer, he can hear the sounds of a Muslim preacher's Friday sermon piped over a loudspeaker, like a neighbor's stereo turned up too high. It comes from the Palestinian village of Abdel Ibrahim, just around the hill's bend, close enough for a toddler to wander over.

Near the end of the Palestinian village's one paved road is the house of Ismail Fawaghra, who wants to build new homes for his kin here. As he and his neighbors see it, each new hilltop attached to Efrat is one more piece of land taken away from Abdel Ibrahim.

'This is Arab land, not Israeli'

Like many Palestinians, he pinned his hopes for holding onto his land on building a new home for one of his four sons on acreage he owns just outside the village. After his application to the Israelis to build was denied, Mr. Fawaghra says, he decided to build anyway. After completing just one roofless room, the Israeli army warned him the house would be bulldozed if he didn't stop the construction.

"I want to put my son here to prevent the Israelis from coming to take it over," he says, looking out over the plot. "This is Arab land, not Israeli land. How are we going to have relations between us and them if they keep taking our land?"

The Israeli Civil Administration, which is in charge of handing out building permits to Palestinians in Area C - about 70 percent of the West Bank - says that it generally will not allow new houses in areas designated as agricultural decades ago. Fawaghra's permit was probably turned down, they say, because he was trying to build on farmland. Palestinians, however, think that is a ruse to keep their villages from growing and taking up more land.

Efrat was not always within earshot of Abdel Ibrahim. When it was founded 15 years ago, it was farther south. Since then, it has grown from 200 to 1,200 families, clinging to the top of the mountain range and inching closer to the village.

Need for 'natural growth' disputed

Now, there is more barbed wire here than ever before as Fawaghra and other Palestinians try to demarcate the land they claim. The piercing, gray vines stretch across the countryside like the lines of an undeclared war, rising about a foot over the low-lying stone walls that signal someone has staked his claim on property.

People here say they don't believe Netanyahu will limit settlement expansion, or that he is allowing for only moderate growth.

"It's not true; they're not stopping settlements. Netanyahu says this, but he's still building," Fawaghra says. "If I say I'm standing still, but you see I'm walking, I'm a liar."

Palestinians and Israeli left-wingers also dispute the concept. forwarded by Netanyahu, that settlements at the very least must be allowed to experience "natural growth."

The concept developed because Israeli settlers complained that their communities were discriminated against when the late Prime Minister Yitzhak Rabin put a freeze on most new building. "Natural growth" would permit the construction of new homes for those who were raised in the settlements and want to live there as adults. But with buildings sprouting much more quickly than families can bring their grown children into the community, Palestinians complain that the natural-growth argument is phony.

Moreover, it appears that the incentive program, reinstated by Netanyahu in March, does encourage people to move to West Bank settlements who otherwise might not. One couple leaving the real-estate office in Efrat said they were weighing specially priced places here and those inside Israel's borders. But they explained that towns with similar government subsidies on new houses inside Israel are often in outlying areas far from desirable cities, services, and jobs.

Garry Seidenfeld, a lawyer who recently moved here from Canada with his wife and six children, says affordability helped, but it was only one of many factors.

"I was looking for a community that was predominantly religious, safe, with good schools - and prices [that] weren't completely out of reach," he says. His home was a resale, but made less expensive by incentives that bring down the price of housing in all the settlements.

Peace Now, a left-wing Israeli group, says the program also comes with other benefits. This includes better mortgages, which finance anywhere from 50 to 95 percent of the price of the house, depending on the location; a 7 percent reduction on income tax; salary incentives for teachers willing to go to the settlements; and grants for businesses.

The group also says that Netanyahu's budget for 1998, released last week, showed a 20 percent increase in spending on settlements.

Mr. Seidenfeld, finishing up a few errands before the weekend in Efrat's quiet town square, says that the incentives weren't the biggest pull. Rather, it was the security and lifestyle Efrat offers. New by-pass roads that allow Israeli drivers to avoid Palestinian villages made him reconsider his reluctance to move to a settlement.

Moreover, he sees Efrat as a safer environment to raise a family than Jerusalem, where Palestinian militants have launched four deadly suicide bombings in the past 19 months. Efrat is also a popular place for immigrants from America and other English-speaking countries.

"The new growth is generally people moving here from the outside, not people from here," Seidenfeld says.

Freeze terrorism first, say settlers

Peace Now says Efrat and other settlements are undergoing much more than "natural growth."

Mosi Raz, the group's director, says that natural growth in Israel is around 3 percent a year, but the settlements have been growing at a rate of 9 to 10 percent this year and last. Of the 13,000 new settlers last year, 8,500 were newcomers.

"I'm afraid that with the incentives," Mr. Raz says, the government "will raise the [growth] rate again to 12 to 15 percent per year," the rate during the settlement drive of the right-wing Israeli government in 1991 and 1992.

Seidenfeld says that Israeli negotiators shouldn't offer any kind of freeze on settlements because the Palestinian Authority hasn't done enough to fight Islamic militant groups.

"Until they stop terrorism, I don't think there should be any emphasis on stopping settlement building," Seidenfeld says. "If they do that, then maybe we'll have something to talk about."