Bethlehem is a Palestinian town under Israeli occupation, and its travails have only been compounded by the Persian Gulf War. For 19 years, Mayor Elias Freij has tried to ensure a pleasant stay for pilgrims and TOURISTS IN THE TOWN WHERE CHRIST WAS BORN. He has hope that the Gulf crisis may eventually bring a resolution to the plight of the Palestinians. But for now, he says, Palestinians are worse off than ever, thanks to the war and the cessation of tourism. "Factories are closed, businesses are paralyzed, people have no money," the mayor said. "Money transfers from the Gulf region are stopped. We are living today under total economic siege."