Two distinct approaches have emerged on the question of how to handle the Hamas-led Palestinian government. There are some in Washington who make no secret of their desire for “regime change” and who may indeed see this as a more achievable goal in the Palestinian territories than in either Syria or Iran. But the European view is on the whole that, however unattractive the Hamas government might be, it is better to try changing its behaviour than seek to drive it from office.
There is a real danger that events on the ground may spin out of control. The deteriorating economic situation in Gaza and the West Bank, the rivalry and friction between the government and the president, and clashes between Hamas and Fatah （the party it trounced in January’s elections） – all of these things suggest a highly volatile arena where no one party is in charge of either politics or security. In this context, the most obvious lever in the hands of outsiders is economic aid. But should that instrument be used as a bludgeon or a surgeon’s knife?
Proponents of “regime change” may hope that maintaining the tightest possible economic squeeze will force Hamas from power in a matter of a few months – and lead to a Fatah comeback, with or without fresh elections. But many experts see this as wishful thinking. It underestimates the capacity of the Palestinians to blame the West （rather than Hamas） for their mounting economic hardship; and it underestimates the extent to which Fatah has been weakened and discredited. It is possible that the Hamas-led government may indeed fall, but if so it will be replaced, not by Fatah, but by chaos, bloodshed and lawlessness.
It is to avoid this scenario that the Europeans favour a more subtle use of economic leverage. Hence the idea of a trust fund, under World Bank auspices, which would bypass Hamas in channelling international aid to the Palestinian territories; an idea adopted in principle by the international Quartet （the US, the UN, the EU and Russia） on 9 May. The Americans took some convincing, and in the end Condoleezza Rice, the US Secretary of State, accepted the proposal only with conditions. The EU mechanism, once finalised, must be acceptable to all Quartet members and will be temporary; it will operate for three months and then be subject to review. But if the money starts to flow, this may give Hamas a breathing space in which to take urgently needed steps.
Unifying Palestinian ranks has long been a Palestinian slogan, but seldom has it been so sorely needed. Hamas knows that, if it is to survive, it must reach some sort of accommodation with Mahmoud Abbas, the Palestinian president; with Fatah, its bitter rival; and, even if indirectly, with the powers which currently shun it: Israel and the international community. Needless to say, the current level of mistrust will make this difficult. But a key to progress might be to create something Hamas has wanted all along: a government of national unity. This would potentially solve the problem of who should talk to the Israelis: that task would be left to Fatah and Mr Abbas. It would ease difficulties over the payment of international aid. And, no less important, it would begin to end the rivalry over who’s in charge of security （which lies at the heart of the Fatah-Hamas clashes）. So far, Fatah, still bruised and vindictive after its election defeat, is setting tough conditions for entering such a government.
Meanwhile the early signs are that Ehud Olmert, the new Israeli prime minister, is a pragmatist. One of his first priorities is to visit President Bush in the White House to discuss his planned unilateral withdrawal from the West Bank. Mr Bush’s blessing seems a foregone conclusion. But can the Israeli leader blithely proceed with his ambitious plan if the West Bank and Gaza descend ever deeper into poverty and anarchy? Unilateralism has its limits. Mr Olmert may prefer to secure the maximum peace and quiet on the Palestinian front while he prepares the ground for a plan which, as he is well aware, will provoke even fiercer domestic opposition than Ariel Sharon faced when he withdrew from Gaza last year. Peace and quiet are relative terms. But Hamas has largely maintained a ceasefire for over a year – which Mr Olmert would prefer that it continues. （Whether Hamas can prevent suicide bombings by other groups, such as Islamic Jihad, is a different – and troubling -- matter.）
In short, while Hamas’s fortunes hang by a slender thread, there is one factor working in its favour: the fear that the only thing worse than Hamas in power might be Hamas forced from power.
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