updated 2/14/2006 4:52:56 PM ET 2006-02-14T21:52:56

Hamas protested “interference” by the United States and Israel following reports Tuesday the nations were exploring ways to topple the militants’ incoming government unless they renounced their violent ideology and recognized Israel’s right to exist.

In Washington, the White House and the Israeli ambassador to the United States denied such a plot. The State Department said it was reviewing U.S. aid to the Palestinians and would make a decision within two weeks.

Exiled Hamas leader Khaled Mashaal said in Sudan his group had no plans to recognize Israel.

“There will be no recognition of Israel and there will be no security for the occupation and colonization forces,” Mashaal told a rally in Khartoum. “Resistance will remain our strategic option.”

The New York Times, citing U.S. and Israeli officials it did not identify, reported Tuesday that the United States and Israel were considering a campaign to starve the Palestinian Authority of cash so Palestinians would grow disillusioned and bring down a Hamas government.

Economic squeeze
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 President Mahmoud Abbas’ ousted Fatah Party. The officials spoke on condition of anonymity because they were not authorized to discuss the matter with the media.

A Foreign Ministry official said Israel was threatening to dry up funding and isolate the Palestinians internationally in an effort to keep Hamas, which is committed to Israel’s destruction, from taking power.

However, Israeli Ambassador Daniel Ayalon told The Associated Press: “There are no ongoing discussions with the U.S. designed to bring down the Palestinian government.”

“There is no conspiracy between Israel and the United States to hurt the Palestinian people and there is no plan whatsoever to compromise the well-being of the Palestinian people,” he said.

A Hamas official protested the reports, saying 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,” incoming legislator Mushir 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.”

McClellan: 'There's no plot'
In Washington, White House spokesman Scott McClellan said, “There’s no plot.” State Department spokesman Sean McCormack said he was “puzzled” by the report.

“We are not having conversations with the Israelis that we are not having with others, including the Quartet. There is no plan, there is no plot,” he said.

He also reiterated the demands of the so-called Quartet of Mideast peace negotiators: that Hamas recognize Israel, renounce terror and accept past agreements reached by the Palestinians. The Quartet — which includes the United States, United Nations, European Union and Russia — backs the “road map” peace plan envisioning a Palestinian state side-by-side with Israel.

Hamas trounced Abbas’ Fatah Party in legislative elections last month and is poised to form a new government in the coming weeks. Hamas swept to power on the strength of public dissatisfaction with Fatah’s failure to eradicate lawlessness and corruption.

Abbas, elected separately last year, will remain in office and has been taking steps in recent days to curb the power of the incoming Hamas legislature.

Mashaal, on a regional tour to generate support for Hamas, said the group still hopes to form a national coalition government with other Palestinian factions, including Fatah.

“By God, Israel will not feel safe and will have no legitimacy,” Mashaal said to shouts of “Allahu Akbar!” or “God is great!” while standing before a huge portrait of slain Hamas founder Sheik Ahmed Yassin.

“The world should commit Israel to withdraw from our territories and stop occupation and aggression and allow the Palestinian people to establish their independent state, with Jerusalem its capital.”

No talks between Israel, Hamas
Acting Prime Minister Ehud Olmert on Tuesday ruled out talks with the militant group.

“We will not negotiate and we will not deal with a Palestinian Authority that will be dominated wholly or partly by a terrorist organization,” he said in comments to visiting Jewish American leaders.

Israel has said it will not deal with Hamas until it renounces violence, recognizes Israel’s right to exist and accepts current agreements between Israel and the Palestinians.

He also called on Abbas to disarm Hamas.

The reports about U.S. and Israeli interest in undoing the results of Jan. 25 Palestinian elections came a day after the outgoing Fatah parliament empowered Abbas to set up a sympathetic court that would be able to veto Hamas legislation unchallenged.

Abbas also took back control of state-run Palestine TV and radio, denying Hamas yet another tool of power.

Threats to international funds
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 also has 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 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 impose widespread layoffs affecting hundreds of thousands of Palestinians.

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.

Palestinian negotiator Saeb Erekat warned that “speaking of ousting Hamas could backfire.”

For one thing, Palestinians could blame the United States and Israel — not Hamas — for their growing misery if funding is cut. Moreover, Hamas certainly would turn to the Muslim world and private donors to try to make up at least some of the Western shortfall.

© 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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