A Palestinian public sector strike, such as the one that began yesterday and is expected to continue today, is the type of news that here is considered a purely "internal Palestinian matter," lacking any media importance. But beyond the basic fact that the modest wage demands are a direct result of the policy of closure and economic attrition on the part of the true sovereign - Israel - the strike presents a genuine challenge to the stability and strength of Salam Fayyad's government, and demonstrates the erosion of its public credibility.

The public sector has been the traditional pillar of the Palestinian Authority. Many of its West Bank employees are Fatah supporters, as are their representatives in the trade unions. While the rift between the Ramallah government and the Gaza government has improved the PA's prestige among western countries, the dispute between the public sector and the Ramallah government reduces the PA's ability to meet its commitments to the donor countries, and to the World Bank in particular.

These commitments include inter alia: reducing the wage component in its budget (by means of dismissals or salary reductions) and forcing residents to pay their debts to the municipalities for electricity and water. In other words, the challenge presented by the workers' struggle - employees on whom Salam Fayyad's government depends in order to be considered legitimate - is liable to reduce the appraisals his government receives from representatives of the global economy.

The workers have three main demands: adjusting wages to match the steep increase in the cost of living; a realistic addition to the "travel expenses" component of salaries (which has not risen since 1999, in spite of the doubling and tripling of the cost of travel because of roadblocks and the increase in fuel prices), and overturning a new regulation that demands every resident procure a certificate of honesty based on "confirmation of debt payment."

The government decided to condition the provision of civil services, beginning this month, on presentation of this certificate from the municipalities or the electricity and water companies. It affects all basic services, such as the issuing of ID cards, passports, driver's licenses and permits for buying and selling, but does not include the receipt of travel permits from the Israeli civil administration.

The government also planned to subtract debts directly from the salaries of public sector employees. Not surprisingly, this reminded trade union representatives of the methods of the Israeli occupation, which conditioned the issuing of traffic and construction permits or the installation of telephone lines on the payment of various debts. But their opposition is not only for symbolic reasons. The unions claim that the very setting of such conditions is illegal, and that it turns every citizen into a person presumed guilty who must prove his or her innocence.

According to World Bank figures, the residents and local councils only began to accumulate debts from 2002 onward due to the non-payment of water and electricity bills. By 2007, these debts had reached an estimated $512 million. Israel, the main supplier of electricity and water, subtracts these debts from the Palestinian taxes and customs it collects within its borders and ports, before their transfer to the PA treasury. This fact is sufficient, in Fayyad's opinion, for the government to intervene in the debts to the local authorities.

Government spokesmen, headed by Fayyad, have often spoken against a "culture of non-payment of bills," thus portraying the general Palestinian public as prone to being debt offenders. By doing so, they only angered this public even more: After all, the PA itself has not paid all its debts to its employees, various institutions and private firms, and asks for consideration because of the "economic situation." The sweeping statements ignore the years of economic crisis that caused a large percentage of Palestinian families to lose sources of income and savings.

Most of the political forces in the Palestinian Liberation Organization, including Fatah, have expressed their support for the workers' demands and their opposition to the "debt-payment certificate." Over the past two days the collective action against the government has begun to bear fruit: Somewhat vague official statements indicate that changes will be introduced into the regulation, so that it will be aimed at those prone to debt, and not the general public.

The strike, and all the public and internal discussions accompanying it, is a fascinating lesson of how Palestinians still acknowledge the power of the collective; how they oppose a liberal economic policy under occupation and colonization, and nurture a democratic suspicion as to the motives of the leading class.