Jerusalem shopping area an economic no-mans land: For Israelis, Ben Yehuda mall our ground zero

JERUSALEM — Jerusalemites have begun to call it "our ground zero."

For Ben Yehuda to be referred to that way is as illuminating as it is ironic: Jaffa Road, a primary artery of the Jerusalem pedestrian mall, was temporarily renamed "New York Street" following the decimation of the World Trade Center on Sept. 11.

That street sign now symbolically hangs outside Sbarro pizzeria, where 15 Israelis were killed in what seemed an isolated suicide bombing last August. But seven terror attacks in the heart of downtown since then have reduced the once-bustling economic zone of Israel's capital to an economic no-man's land.

While the more courageous Israelis may refuse to fall prey to Palestinian terror by locking themselves up at home, Ben Yehuda — once thriving with shops, cafés, galleries and produce stands — conspicuously is absent of foreign tourists.

In an effort to revive downtown Jerusalem's economy, Mayor Ehud Olmert recently held emergency discussions with Prime Minister Ariel Sharon and Finance Minister Silvan Shalom on possible rescue plans for the city's main thoroughfare.

Olmert demanded that businesses in the city center receive discounts on property tax or sales tax exemptions. He also asked Sharon to provide Jerusalem residents with "income tax points" similar to those given to Negev and Galilee residents.

But for many with businesses in the heart of the city, the effort comes too late.

"For many of us, business is no longer profitable," said Zion Barsheshe, leaning heavily on the counter of the Coffee Time café.

Barsheshe used to employ more than 60 people in his three stores near Zion Square, at the bottom of Ben Yehuda mall. "Now I have five people working here. I've paid $350,000 out of my own pocket to keep these places afloat since the intifada" started in September 2000, he said. "But now the banks are breathing down my neck, and I've had to close one of the places.

"Hell, I don't even let my own children come down here, so how can I expect tourists to come?"

Jerusalem's deputy police commander, Ilan Franco, tried to soothe shopkeepers' frayed nerves on the Monday following the latest bombing. Undercover and regular police are "maximally deployed in order to prevent another attack in this hard-hit area," he said on his downtown beat.

With continued warnings of attacks, there now seems to be more border police patrolling the streets than customers. Soldiers armed with M-16s and wearing neon yellow winter gear prowl the rooftops of buildings, looking down upon what has become known as "the terrorists' intersection."

In Jerusalem last year, there were 66 attacks that left 33 people dead and 513 wounded, according to Police Commissioner Shlomo Aharonishky.

Like many of his competitors, Barsheshe invested huge sums in his stores in the midst of the peace process euphoria and in preparation for the year 2000, expecting hordes of tourists to descend upon Jerusalem.

But that gamble failed when the Palestinians turned to violence and streets once packed year-round with tourists became deserted.

Consequently, many storeowners whose rents and property taxes have risen in the past year and a half are now mired in debt. The blank storefronts dotting Jaffa Road show how many have closed up shop.

The municipality hopes cultural events can draw tourists and locals to the downtown area.

"We are also helping them finance their debt payments, which is about all we can do considering the current recession," Deputy Mayor Yigal Ademi said.

Barsheshe scoffed at the plan. He condemned both the government's inability to thwart the frequent terror attacks and, concurrently, the municipality's decision in recent months to raise property taxes by 8 percent.

"Now you tell me," Barsheshe asked, "how is that supposed to help me recover my losses?"

In a conspiratorial whisper, Barsheshe confided that not a day goes by that he does not think of leaving Jerusalem for America.

To Zion Hasid, however, property taxes don't matter. His sole attention is focused on rebuilding Babah, his women's clothing store, which last week was cluttered with shards of glass and a coating of ash.

"This is hell, but where else will I go?" asked Hasid, who emigrated from Iran 30 years ago.

Standing beside Hasid, Mashiach Yazdi, who heads the Finance Ministry's Department of Hate Crimes, was directing contractors and insurance appraisers in and out of stores. Yazdi and his team are responsible for cleaning up, rebuilding and reimbursing storeowners for damages incurred in terror attacks.

"In days like this my job is mostly to act as a psychologist…More than anything it is our duty to assure those who have lost everything that there is hope and that the government will ensure that they will be on their feet in no time."

After taking stock of the store, Yazdi turned to Hasid, held him by both shoulders and asked him if he wanted the government to restore his damaged goods or order new ones. Then, as the contractor and appraiser marched out of Hasid's store, Yazdi uttered words seldom heard by insurance appraisers.

"What you want, you can keep," he said. "We'll do it anyway you want; just tell me."

In the latest incident Jan. 27, five days after two Jerusalem women were murdered by Palestinian gunmen, a man was killed and more than 125 people injured when a suicide bomber blew herself up at the intersection of Jaffa Road near King George Street. Although the explosion shattered the glass storefronts of 60 shops and sent merchandise ranging from diapers to diamond rings flying across shop floors, by the next day, the besieged city center once again returned to a tense "normality" — normal, that is, for Israelis.

The damage to the 60 stores in that attack amounted to some $2.5 million, Yazdi said, one of the largest sums in recent months. Cleaning and construction crews, paid for by the government and insurance companies, require at least a week to "get this street back to normal," a task that normally takes just one day.

It's not only businesses whose storefronts are blown apart that are affected by terror here.

Yediot Achronot reported fully half the tourism employees in Jerusalem have been fired, hotels are at less than 30 percent occupancy, and store owners have seen income plummet by more than 80 percent since the intifada began.

So great is the damage done to Jerusalem's tourism industry that a group of 55 Israeli hotels decided to sue the Palestinian Authority for hundreds of millions of dollars for intifada losses. In addition, Israel's Association of Hotels negotiated a deal with the Finance Ministry in December under which the government and municipality will each pay a third of every hotel's property tax.

And, from here, who knows how things will develop.

"The worst part is that no one thinks it will end soon," Barsheshe said. "We are not talking weeks or months, but years — generations."