JERUSALEM - Hamas derided the United States and Israel on Tuesday following reports they were exploring ways to topple the militants' incoming government.
Israeli security officials said they were looking at ways to force Hamas from power, and were focusing on an economic squeeze that would prompt Palestinians to clamor for the return of Palestinian leader Mahmoud Abbas' ousted Fatah Party. The officials spoke on condition of anonymity because they were not authorized to discuss the matter with the media.
But Foreign Ministry spokesman Mark Regev said, "There is no such plan."
The New York Times, citing anonymous U.S. and Israeli officials, reported Tuesday that the United States and Israel were considering a campaign to starve the Palestinian Authority of cash so Palestinians would grow disillusioned with Hamas and bring down a Hamas government.
U.S. Embassy spokesman Stewart Tuttle had no immediate comment.
The reports came a day after the outgoing Fatah parliament gave sweeping new powers to Abbas, allowing him to set up a sympathetic court that would be able to veto Hamas legislation unchallenged.
Mushir al Masri, a Hamas spokesman and incoming legislator, said attempts to bring down a future Hamas government were hypocritical.
"This is ... a rejection of the democratic process, which the Americans are calling for day and night," al Masri said. "It's an interference and a collective punishment of our people because they practiced the democratic process in a transparent and honest way."
"We need a firm Islamic and Arabic position to confront this challenge," al Masri added.
The idea of withholding aid is not new. Since Hamas' electoral victory, the West has been threatening to cut nearly $1 billion in annual aid to the Palestinians, though Russia's recent invitation to Hamas to visit Moscow, and France's support for the Russian approach, have cracked what was a united front.
Israel has also threatened to cut off monthly transfers to the Palestinians of about $50 million from taxes and customs it collects for them, once Hamas takes power. The new Palestinian parliament is to convene for its first session on Saturday, and a new Cabinet is expected to be appointed within weeks.
What is new is the twist of forcing regime change by impoverishing the Palestinians even further.
Even with the Israeli tax transfers and Western aid, the Palestinian Authority is expected to run a $660 million budget deficit in 2006. Without the tax and aid, the Hamas government could be forced to enact widespread layoffs that would scotch the livelihoods of hundreds of thousands of Palestinian families.
Besides the cash squeeze, Israel has other leverage on the Palestinian Authority, including its control of the movement of people and goods between the noncontiguous West Bank and Gaza Strip, and the entry of Palestinian workers into Israel.
The strategy of bringing Palestinians to their knees by cutting off cash could easily backfire, however, with Palestinians blaming the U.S. and Israel - not Hamas - for their growing misery. Moreover, Hamas would certainly turn to the Muslim world and private donors to try to make up at least some of the Western shortfall.
Israeli security officials said they weren't optimistic about prospects for ousting Hamas.
Israel, which was caught unaware by Hamas' sweeping victory in Jan. 25 Palestinian elections, is putting the finishing touches on its policy toward Hamas, which is to be sent to Defense Minister Shaul Mofaz and acting Prime Minister Ehud Olmert later this week for his review, Israel Radio reported on Tuesday.
Asked how Israel would handle Hamas, Mofaz told the radio station, without elaborating, that "Israel is strong enough to deal with any eventuality that would come down the pike. ... If Hamas creates a situation in which it continues to act as a terror group and takes over the Palestinian Authority, Israel has the tools to deal with an authority ruled by Hamas."
Mofaz was headed to Cairo on Tuesday to discuss Hamas' ascent to power and security arrangements on Israel's border with Egypt.
The Times said the idea of forcing regime change by further impoverishing the Palestinians was being discussed at the highest levels of the U.S. State Department and the Israeli government. The ultimatum to Hamas would be either to recognize Israel's right to exist, abandon violence and accept previous Palestinian-Israeli agreements, or risk isolation and eventual collapse, the newspaper said.
Hamas, which swept to power on the strength of public dissatisfaction with Fatah's failure to eradicate lawlessness and corruption, has repeatedly rejected Western demands to change its violent ways. On Monday, a Hamas leader said the group would annul landmark interim peace accords with Israel from the mid-1990s.