Since Hamas' victory in January's Palestinian parliamentary elections, Israel and the West have isolated the Islamist government. But that strategy, most analysts contend, has intensified violence in the region.
Many analysts say the Israeli-Palestinian relations are at their lowest point in years. They cite escalating violence between the two sides; the deteriorating economic and political situation on the West Bank and Gaza Strip that has even led to street violence between Hamas and opposition Fatah loyalists. Israeli officials talk about a weapons build up in Gaza, while carrying out preemptive assaults on what they call "Islamic militants".
Palestinian Economy
The situation on the Palestinian side is particularly bleak. Many analysts point to the impoverishing effects of the Western-led economic sanctions imposed on the Hamas government since its January victory. The Palestinian economy is barely functioning. Unemployment and poverty affects more than half of the population. In the Gaza Strip, 80 percent of the population lives below the poverty line. Central government functions and most social services have broken down. One-hundred-sixty-thousand civil servants are on strike after six months without being paid.
Recently, Palestinian leaders were talking about forming a unity government, which would have signaled a way out of the political deadlock between Hamas and Fatah, and the crippling economic boycott. But the talks have faltered and President Mahmoud Abbas, the leader of Fatah, has hinted he could take strong steps, including dissolving the government, declaring a state of emergency and calling a referendum on new elections if talks don't progress.
Many Middle East watchers warn that the deteriorating situation has created almost insurmountable obstacles to the resumption of peace negotiations between Israelis and Palestinians.
Aaron Miller has been an advisor on the Middle East peace process to six former U.S. Secretaries of State and is now a Senior Fellow at the Woodrow Wilson International Center in Washington.
"Rarely have I seen a period grimmer than the one that exists right now. There's no trust between the Israelis and the Palestinians. There is no governing framework that both sides have accepted," says Miller. "The Roadmap [for Peace in the Middle East] is in some respects a fiction. People say they accept it but they really don't. There is no third party mediator who is seriously committed right now to even helping the parties to create an environment for negotiations."
Miller argues that a major impediment to progress is Hamas' refusal to fulfill three key conditions: recognizing Israel, renouncing violence and accepting past peace accords. He says the Palestinians must first put their house in order before talks on the creation of a Palestinian state can begin.
"They have to make a decision as to whether or not they want to continue on the path of armed struggle, terror and violence, or whether or not they will commit themselves to a political strategy, which in essence over time gives up the gun in favor of negotiation. They also have to acquire a monopoly over the forces of violence within their own society," says Miller.
The Threat of New Extremism?
But other analysts caution that the postponement of peace talks and isolating the Palestinian Authority under Hamas threatens to radicalize the Palestinians and that could lead to conditions for a failed state even before a Palestinian state is ever established.
Rob Malley, Director of the Middle East and North Africa Program at the International Crisis Group based in Brussels notes that the collapse of the Palestinian Authority could give rise to rampant extremism.
"Disbanding or questioning the results of elections and trying to thwart the ability of the newly elected Hamas government to govern, we saw what it led to although in a different way, in Algeria. [Algeria's Muslim movement was poised to win elections in 1992 when the military intervened and canceled the vote.] Destroying the institutions by depriving them of funds or dismantling them as in Iraq, well we saw what happened when the army was dismantled and militias took their place. [Saddam Hussein's security forces were disbanded soon after the U.S.-led military action in Iraq] And Hamas, which is being increasingly isolated, is turning increasingly to its allies in the region -- to Syria and Iran. Think Hezbollah and Lebanon. So if you want to create Algeria, Lebanon and Iraq in Palestine, this is the way to go," says Malley.
The ICG's Malley says his organization, which is dedicated to preventing and resolving conflicts, supports an end to the international boycott of the Hamas government, but under certain conditions.
"We advocate a much more realistic approach of trying to put Hamas to the test, not in terms of these abstract statements -- where it renounces violence, respects past peace agreements, recognizes Israel -- but will it enforce a ceasefire, in fact, better than Fatah had in the past? And are they prepared to allow President Abbas to negotiate with Israel? That's the test we would put them to," says Malley.
Political scientist Ian Lustick of the University of Pennsylvania and author of the book Trapped in the War on Terror contends Israel also has a part to play in moving the peace process forward. He says Israel's choices are twofold.
"It can open opportunities for ambiguity as to the long run position of Hamas and thereby allow a unity government to emerge, which Israel can negotiate with. Or it can decide that it will only deal with secular nationalists," says Lustick. "In that case it has to create conditions under which the secular nationalists will win a new elections. It can do that by shifting its position to one that reassures Palestinians that the state that is on offer is real and satisfying. It has to release from prison secularist nationalists who have the popularity and the talent to win an election over Hamas."
Meanwhile, most Mideast analysts agree that a key factor for resuming the peace talks is greater engagement by the international community -- including the United States, Europe and Arab states.
This story was first broadcast on the English news program,VOA News Now. For other Focus reports click here.