ISRAEL'S HORRIFIC attack on a residential neighborhood in Gaza City sparked outrage around the world. Israeli Prime Minister Ariel Sharon personally approved the July 22 assault by a U.S.-made F-16 fighter jet that killed 15 people, nine of them children, injured 145 and leveled several buildings.

"All that remained were chunks of cinder block, several stumps of what had been pillars, pulverized lumps of concrete with twisted snarls of what had been iron reinforcement bars poking out of them, remnants of plumbing pipes and scraps of clothing," the New York Times reported.

Witnesses reported seeing severed limbs and chunks of flesh scattered in every direction. "I ran here and just saw pieces of flesh everywhere, one man running away holding a lump of flesh on a metal tray and another pulling out a baby boy with half his face blown away, obviously dead," said Knel Deeb, one of the first people to arrive at the scene.

And Sharon's response? Displaying the callous disregard for Palestinians that has characterized his long career as a war criminal, he called the raid "one of our biggest successes."

As international outrage grew, a huge funeral procession of some 300,000 took to the streets of Gaza to demand justice. Even Israel's biggest cheerleader--the U.S. government--had to object, with White House spokesperson Ari Fleischer calling the massacre "heavy-handed."

Eventually, Israeli officials had to stop hailing the bombing as a triumph and go to Plan B. Taking their cue from the Pentagon's excuse for "collateral damage" in Afghanistan, Israeli Air Force officials blamed "bad intelligence," claiming that they had no idea anyone other than the target of the attack--Hamas leader Salah Shehada, who was killed along with his wife, one of his daughters and his bodyguard--was in the building.

What an obvious lie! You only need common sense, not "intelligence," to know that firing a one-ton bomb into an apartment building in Gaza--one of the most densely populated places on earth--will inevitably kill civilians.

In reality, this savage new escalation in Israel's state-sponsored terror against Palestinians was designed to achieve two goals. First, Israel wanted a high-profile example of its vow to punish family members of anyone accused of terrorist activities. Second, the attack came just hours after Hamas spiritual leader Sheik Ahmed Yassin--after days of discussions with European diplomats--announced that his group and other militants would call off suicide attacks if Israeli forces withdrew from West Bank towns reoccupied last month.

Rather than face international pressure to withdraw, Sharon calculated that assassinating a Hamas leader would lead to demands for revenge--and provide the needed pretext to continuing the occupation of seven major Palestinian cities on the West Bank.

Israeli forces have kept 700,000 Palestinians in the West Bank under virtual house arrest since late June. Since the new uprising against Israel's occupation began 22 months ago, the Palestinian economy has been wrecked, and living standards are in sharp decline, according to a new study by U.S. Agency for International Development.

Fully 30 percent of children under 5 suffers from chronic malnutrition and 21 percent from acute malnutrition--a horrific rise since 2000, when only 7.5 percent and 2.5 percent of children suffered from chronic and acute malnutrition respectively.

Seventy percent of people in the West Bank and Gaza live below the poverty line of less than $2 a day--up from 50 percent only three months ago, according to the World Bank.

Incredibly, as people around the world grappled with the horror of Israel's Gaza attack, George W. Bush chose the following Friday to signal that he was dropping U.S. demands that Israel curb the growth of settlements in the Occupied Territories.

Even U.S. diplomatic proposals, such as the Mitchell plan drawn up by former Senate Majority Leader George Mitchell, call for a ban on settlement construction--and this isn't even to mention United Nations resolutions and the Geneva Convention, which outlaws settlements on occupied land.

For 20 years, the U.S. has been officially opposed to settlements--even if the opposition was largely rhetorical. Now, Bush is sending a further signal that his administration backs Israel's war against Palestinians--even as Israel deliberately targets civilians.

We need to stand up against Israel's terror--and demand that the U.S. government stop supplying the weapons and planes used to carry out the horror in Gaza.

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