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The biggest obstacle to peace between the Israelis and the Palestinians is not the Palestinians' demand that Jewish settlements in the West Bank be dismantled, the barrier separating much of the West Bank from Israel, or the recent rightward shift of the Israeli body politic. It is the emergence of Hamas as the de facto government of the Gaza Strip, where 1.5 million Palestinians reside.

Hamas has regularly attacked Israel with rockets from Gaza or allowed others to do so. It poses a strong and growing political threat to the more moderate Palestinian Authority, which is led by President Mahmoud Abbas and his technocratic prime minister, Salam Fayyad, and which governs the West Bank and used to run Gaza, too. Whereas PA leaders see negotiations with Israel and institution building as the best way to ultimately gain statehood, Hamas seeks to undermine the peace process. Many Hamas members have not reconciled themselves to the Jewish state's existence. Hamas' leaders also fear that Hamas would reap none of the benefits of a peace deal and that in the event of one, the PA would score political points at their expense. Hamas has shown repeatedly that it can bring talks to a painful end by castigating moderate Palestinians and turning to violence.

Despite Hamas' centrality to Israeli security and Palestinian politics, Washington still clings to the policy that the Bush administration established after Hamas beat more moderate Fatah candidates in elections in Gaza in 2006. The United States and other members of the international community withdrew development aid from Gaza, tacitly supporting Israel's shutdown of the Gaza Strip, and refused to work directly with Hamas. Their hope was to force Hamas' collapse and bring Fatah back to power. But isolation has failed, and today Hamas is far stronger than when it first took power. The Obama administration, more by default than by design, has continued these efforts to isolate and weaken Hamas, opposing talks with the group and condoning Israeli military raids.

Israeli policy also remains stuck in the past. Regular rocket barrages from Gaza mean that Israel cannot simply forget about the area or Hamas. Israel has kept Gaza under siege and has sometimes used considerable force. Although the Gaza war of December 2008 and January 2009 (which Israelis call Operation Cast Lead) did damage Hamas' credibility, and even though Hamas has since reduced its rocket attacks, the long-term sustainability of such an aggressive approach is questionable. Still, Israel and the international community have not developed a new strategy in response to Hamas' consolidation of power.

Some prominent Israelis, such as Efraim Halevy, the former director of Mossad, the Israeli secret service, and Giora Eiland, a former head of Israel's National Security Council, have called for negotiating with Hamas. Other Israelis, who fear that the group will never abandon its goal of destroying Israel, think the Israeli military should retake Gaza before Hamas gets any stronger; they argue that postponing the day of reckoning will cost Israel dearly in the future. But with neither option being palatable at this time, Israel continues to rely on economic pressure and military operations to preempt terrorist attacks from Gaza, kill the people there who launch rockets into Israel, and retaliate for Hamas' provocations.

Although shunning Hamas may seem morally appropriate and politically safe, that policy will undermine Israel's peace talks with Abbas and other Palestinian moderates. An alternative approach is necessary. Hamas could, perhaps, be convinced not to undermine progress on a peace deal. To accomplish this, Israel and the international community would have to exploit Hamas' vulnerabilities, particularly its performance in governing Gaza, with a mix of coercion and concessions, including a further easing of the siege of Gaza. At the same time, they should support the state-building efforts of Fayyad and restart the peace process with Abbas in order to reduce the risk that Hamas will win the struggle for power among the Palestinians. Moreover, because the effort to transform Hamas into a responsible government could fail, the international community must be prepared to support a more aggressive military response by Israel if Hamas does not change.

THE EVE OF DISRUPTION

Peace talks can begin with Hamas on the sidelines, but they cannot finish if Hamas refuses to play ball. Hamas has proved that it has the means to threaten Israel and disrupt peace talks. Rocket and mortar strikes are the most obvious method. According to Israeli government statistics, in 2005, Hamas and other Palestinian groups launched around 850 rockets and mortars at Israel from Gaza. By 2008, the figure had climbed past 2,000. The death toll from these attacks was low, but the psychological effect has been considerable. Hamas uses Qassam rockets, which have unpredictable trajectories and so fall on soldiers and civilians alike. One 2007 study found that 28 percent of the adults and between 72 percent and 94 percent of the children in Sderot, the Israeli town most frequently hit by rockets, suffered from posttraumatic stress disorder.

In addition to the rocket attacks, Hamas and other militant groups shoot at Israeli soldiers and agricultural workers near the Gaza border. From 2000, when the second intifada broke out, through 2009, there were over 5,000 such attacks from Gaza. The vast majority occurred before Israel withdrew from Gaza in 2005, but Israel still suffered more than 70 attacks in each of the three years that followed. A particularly difficult problem has been Hamas' use of improvised explosive devices near the security barrier. These bombs are powerful enough to endanger Israeli soldiers patrolling the Israeli side but can only be dismantled from the Gaza side.

Attacks by Hamas plummeted following Operation Cast Lead, a tough, sometimes brutal three-week campaign against Gaza carried out by Israel in December 2008 and January 2009; it ended with a cease-fire on both sides. After March 2009, no month of that year saw more than 25 rocket and mortar attacks -- a far cry from the violence of 2008. There were only four shootings in 2009. So far, 2010 has seen a comparatively low number of rockets flying from Gaza -- few, if any, of which were launched by Hamas itself.

But few attacks is not the same as no attacks. The Israelis still fear that Hamas, which is building its capabilities, could easily step up the violence if it chose to do so. For the Israelis, engaging in peace talks premised on giving up territory is difficult when their country is under attack; they justifiably feel the need to hit back. The Israelis also worry that Hamas or another Palestinian group would launch rockets from any territory that Israel surrendered in the West Bank, just as they did from Gaza after Israel withdrew its forces in 2005.

For moderate Palestinian officials seeking peace, the challenge goes beyond Israeli fears. Israel and the international community, of course, recognize that Abbas does not control Hamas. But if violence again flared up, the Israelis would question the value of peace talks with moderates if they cannot end the violence. Israel does not respond to every attack, but when it does it often hits back hard, killing Hamas leaders and, inadvertently but regularly, civilians, too. Moderate Palestinian officials would find it impossible to gain popular support for negotiations while Palestinian civilians were dying at the hands of Israelis. So even when its attacks do no damage, Hamas walks away triumphant, whereas both Israeli and Palestinian moderates are discredited.

Hamas is also capable of kidnapping personnel from the Israel Defense Forces or other Israelis: a rare but game-changing event. The most dramatic incident was the June 2006 abduction of the Israeli soldier Gilad Shalit. Israeli society rallied behind Shalit's family, and the IDF invaded Gaza in an operation that killed over 400 Palestinians and failed to secure Shalit's release. The kidnapping also helped convince then Prime Minister Ehud Olmert to attack Hezbollah in Lebanon after Hezbollah kidnapped two Israeli soldiers in July 2006. In circumstances like these, negotiations are almost impossible.

Further complicating the picture is Hamas' ability to undermine peace talks without using violence itself. Gaza is home to various other terrorist groups, from Fatah rejectionists to Salafi jihadist organizations, none remotely as strong as Hamas but all itching to attack Israel. Hamas can allow these groups to operate and then claim impotence or ignorance. It can also stymie negotiations politically. Hamas lambasted Abbas for meeting with Israeli officials and for not demanding that the UN endorse the findings of the Goldstone report, which criticized Israel's conduct of Operation Cast Lead. Hamas uses such attacks to "prove" to Palestinians that Abbas is selling out the Palestinian cause. Such charges make it harder for Abbas to consider making any concessions to Israel, particularly the type that involve no immediate quid pro quos from Israel or, worse, that mean swallowing rebuffs or tolerating continued settlement building.

For now, Hamas does not have to do much to scuttle peace talks: disagreements over settlements and other disputes have left the Israelis and the PA unable to get anything going beyond indirect talks brokered by Washington. Both sides view these talks with considerable skepticism. But should negotiations move forward, as the Obama administration is urging, Hamas is likely to play the spoiler. Progress on negotiations with Israel would make the Palestinian moderates look good and pose a threat to Hamas' standing among Palestinians by reducing the appeal of its ideological hostility toward Israel.

Skeptics might contend that peace talks have often occurred without Hamas' participation. Since the second intifada, Washington has tried to move the ball forward from time to time, but any resulting talks made so little progress that Hamas did not perceive them as a serious threat. When talks were near fruition in the mid-1990s, however, Hamas -- much weaker then -- struck. In 1996, Hamas and Palestinian Islamic Jihad (PIJ) launched a series of suicide bombings against Israel. These not only killed over 60 Israelis but also shattered the prospects of Prime Minister Shimon Peres and his pro-peace bloc in upcoming elections, paving the way for the triumph of Benjamin Netanyahu, who was far more skeptical of negotiations. Terror has worked for Hamas, and it might be tempted to use the tactic again.

THE ISOLATION OF GAZA

Israel, Egypt, and the international community have put Gaza under siege to isolate and weaken Hamas. Israel has sealed off Gaza from the sea, and the crossing points into it from Israel and Egypt have usually been closed to normal traffic. Humanitarian aid goes in, but there is a long list of prohibited goods. Ironically, however, Israel's humanitarian concerns have prevented it from truly pressuring the Gazan people. Israel has tried to coerce Hamas without causing mass starvation, an approach that Israeli officials have described as "no prosperity, no development, no humanitarian crisis." Although Israeli policies are pushing Gaza closer to the brink, the threat of even more misery simply is not credible.

This is small comfort to Gazans, however. Aid agencies now put Gaza's poverty rate at 80 percent, and most Gazans survive on UN handouts and aid from Hamas' patrons, such as Iran. The World Health Organization reported at the beginning of this year that hospitals are unable to deliver quality health care; their doctors, unable to receive training. Disease and malnutrition are spreading, and schools are deteriorating. Gazans, who for decades took menial jobs in Israel, lost access to the Israeli labor market after violence flared during the second intifada. Subsequent border closures and the collapse of aid and investment have further decreased employment.

The world lays the blame for this humanitarian catastrophe at Israel's feet. After UN Secretary-General Ban Ki-moon visited Gaza in March 2010, for example, he declared Israeli policy "wrong," contending that it was causing "unacceptable suffering." Still, except during Operation Cast Lead, the siege received only limited attention until recently.

The spotlight focused again on Gaza on May 31, 2010, when Israeli commandos stormed the Mavi Marmara, a civilian Turkish ship trying to break the blockade, and killed nine activists. Turkish leaders, already at odds with their once close ally over Operation Cast Lead, denounced the raid, demanded an apology, and took reprisals, including the decision to close Turkish airspace to Israeli aircraft. British Prime Minister David Cameron said the raid was "completely unacceptable," and Obama administration officials called for "a new approach to Gaza." Soon, the botched raid became a broader fiasco for Israel. It put global attention back on the siege of Gaza. Israel's restrictions of innocuous items, such as cilantro and jam, came under increased scrutiny. Worse, Hamas started to look like it was the victim of Israeli cruelty and violence.

To appease critics after the Mavi Marmara bungling, Israel declared that it would focus on military-related goods only and promised to make it easier for Gazans to seek medical care outside the Gaza Strip. But it maintained a ban on "dual-use" items, which could include goods ranging from electronics to construction materials, depending on how the term is interpreted. Egypt, for its part, opened the Rafah crossing to allow humanitarian aid into Gaza and to admit into Egypt Gazans seeking medical care. But Cairo remains eager to avoid helping Hamas unless forced to by public opinion and, significantly, is continuing work on a wall along and under its border with Gaza. Easing Egypt's and Israel's siege would lessen Gazans' misery somewhat and help Hamas politically, but the Gaza Strip still has a long way to go before it is not a basket case.

HELP FOR HAMAS

The siege has failed on another level: it has not weakened Hamas, which has by now crushed or outflanked its political rivals. Today, Hamas has an unquestioned -- and, in the eyes of most Gazans, largely legitimate -- monopoly on the use of force in the Gaza Strip, and its political clout among Palestinians has grown at the expense of Fatah. Hamas bases its claim to power on its victory in the 2006 elections, when it ran largely on a platform that stressed Fatah's corruption and failure to deliver either services on the ground or sovereignty at the negotiating table. Younger Palestinians, in particular, are disillusioned with Fatah: they prefer the new brand of political Islam to old-fashioned Arab nationalism. Meanwhile, the plunge in trade and investment in Gaza has hurt the small Gazan middle class and others who might otherwise have had the resources to stand up to Hamas.

The siege has also increased the importance of the social services that Hamas provides. After it took over the Gaza Strip in 2007, Hamas revamped the police and security forces, cutting them from 50,000 members (on paper, at least) under Fatah to smaller, more efficient forces of just over 10,000, which then cracked down on crime and gangs. No longer did groups openly carry weapons or steal with impunity. People paid their taxes and electric bills, and in return the authorities picked up garbage and put criminals in jail. Gaza -- neglected under Egyptian and then Israeli control, and misgoverned by Palestinian leader Yasir Arafat and his successors -- finally has a real government.

Despite the siege, Hamas is growing stronger militarily. Its rockets are getting more powerful and are reaching farther. Until 2008, the rocket attacks hit only the relatively unpopulated areas near Gaza, such as Sderot. Over time, however, Hamas tripled the range of the rockets; today, they can reach large nearby cities, such as Ashqelon and Beersheba -- and possibly even Tel Aviv. And it is developing indigenous rocket systems that have an even longer range and a larger payload. Through illicit tunnels linking the Gaza Strip to Egypt, Hamas smuggles out hundreds of young men for advanced training in Lebanon and Iran. Its fighters are becoming more formidable.

Hamas has also found a way to benefit economically from the blockade by taxing the tunnel trade, even creating a "tunnels authority." Yezid Sayigh of King's College London has estimated that Hamas earned up to $200 million from tunnel taxes in 2009. The tunnels also employ over 40,000 people, creating an important business constituency for Hamas.

And thanks to Israel's blockade and military strikes against Gaza, Hamas has found it easier to raise money from Iran, which gives Hamas tens of millions of dollars a year as part of its struggle against Israel and to score points with ordinary Sunni Arabs who admire Hamas. Hamas is also beginning to look beyond pariahs such as Iran for backing. Khaled Mashaal, the group's so-called external leader, met with Russian President Dmitry Medvedev in Damascus in May. And together with Turkish President Abdullah Gül, they called for including Hamas in peace talks. The Mavi Marmara raid has accelerated Hamas' escape from diplomatic isolation, with more and more countries casting Hamas as the victim.

The siege is also dragging down U.S. policy toward the Muslim world. The suffering of Gazans -- broadcast constantly on al Jazeera -- acts as a radicalizing force from Morocco to Indonesia. Terrorists in the United States itself, such as Major Nidal Hasan, the Fort Hood shooter, and Faisal Shahzad, the Times Square bomber, cite Gaza to justify their actions. And as many Muslims see it, U.S. support for Israel's siege proves that the United States is anti-Palestinian. Although the Obama administration successfully pressed Israel to ease the blockade, the remaining restrictions and the general sense that the United States continues to be Israel's strongest ally have meant that this perception endures.

This perception would become stronger if a new military operation on the scale of Operation Cast Lead occurred -- an ever-present risk. In part, this risk is random: the rockets that land in Sderot usually kill no one, but there is always a chance that one could kill children or harm enough adults that the Israeli government would feel political pressure to escalate the conflict. An even bigger problem for Israel is that the current cease-fire is now based on short-term deterrence rather than a long-term deal. Hamas has stopped attacking Israel not because it has agreed to a broader political arrangement but because the benefits outweigh the costs for now. The deterrence equation could easily be disrupted if, say, more arms went to Hamas or if politics in Israel or Gaza changed. In other words, the siege is failing even on its own terms: Hamas has become stronger politically and militarily.

THE LIMITS OF FORCE

Some Israelis believe that the alternative to the siege is to confront Hamas head-on, removing it from power and forcing it underground. But that strategy would lead Israel into a quagmire. Conquering Gaza would be a relatively easy task for the IDF, but it would almost certainly result in far more Israeli casualties than the 13 who died during Operation Cast Lead. The Palestinians lost over 1,000 Hamas fighters and civilians in Operation Cast Lead, and they, too, would probably lose far more. In Operation Cast Lead, Israel penetrated only partway into the Gaza Strip and did not stay and occupy the territory. If the IDF were to remove Hamas from power, however, it would have to stay for months to dismantle Hamas' infrastructure there: the hospitals, mosques, and social services that Hamas has been putting in place for decades. And it would not be cheap, since Israel would have to bear the financial burden of deploying thousands of troops to Gaza.

Diplomatically, occupying Gaza again would hurt Israel's relations with the United States, the international community, and Palestinians in the West Bank. Israel would inevitably make mistakes and kill innocent Gazans, making negotiations even more difficult. Hamas, meanwhile, would try to make the long-term price of any occupation too high for Israel to sustain. In Gaza itself, the organization could attack Israeli soldiers with snipers, improvised explosive devices, suicide bombs, and ambushes, and in the West Bank it could use its operatives to strike Israel. All this would take a bloody toll on the Israeli military.

Another big political loser would be Abbas. When Israel invaded Gaza in December 2008, the credibility of both Abbas and Fayyad suffered; they called for a cease-fire rather than for the kind of violent opposition that Palestinian leaders had been extolling for years. At the time, many Palestinians believed, and correctly so, that Abbas was rooting for Israel and against his fellow Palestinians because he sought to gain a political advantage over Hamas. Public opinion polls taken before the war showed that the leader of Hamas, Ismail Haniyeh, would lose a presidential race against Abbas; polls taken after the war showed Haniyeh winning. Renewing the peace process with Abbas will be impossible if the IDF and Hamas are shooting at each other in Gaza. Abbas would not want to be seen as supporting the Israeli takeover, and he openly rejected such an option during Operation Cast Lead. But even if Abbas kept a low profile, Hamas would still see him as complicit and try to undermine his position in the West Bank.

Another problem is that Israel would lack staying power. Israel left Gaza in 2005 in the hopes of never returning, and it does not have the stomach for another grinding occupation. On the other hand, seizing Gaza again only to withdraw again would simply allow Hamas to retake power once more, because Hamas' moderate rivals in the Gaza Strip are too weak to take over. A new occupation is not the answer, and despite bluster to the contrary, most Israelis realize this.

CEASE-FIRE CALCULUS

If Hamas cannot be uprooted, can it be calmed enough to not disrupt peace talks? Maybe -- and the chance is worth pursuing. Although often depicted as fanatical, Hamas has shown itself to be pragmatic in practice, although rarely in rhetoric. It cuts deals with rivals, negotiates indirectly with Israel via the Egyptians, and otherwise demonstrates that unlike, say, al Qaeda, it is capable of compromise. Indeed, al Qaeda often blasts Hamas for selling out. Hamas has at times declared and adhered to cease-fires lasting months, and some leaders have speculated that a truce lasting years is possible. And although Hamas has refused to recognize Israel's right to exist, its leaders have also said they would accept the UN-demarcated 1967 borders between Israel and the Palestinian areas as a starting point for a Palestinian state. Perhaps the most important sign of pragmatism has been Hamas' general adherence to its cease-fire after Operation Cast Lead.

To be sure, there are many reasons why Hamas might undermine peace talks. Progress on negotiations would elevate Abbas' standing among Palestinians and threaten Hamas' position. More important, it would weaken Hamas' message that resistance is the path to victory. In the 1990s, support for Hamas rose and fell in inverse proportion to progress on the peace talks, and Abbas hopes that he can outdo Hamas by rebuilding Fatah's political position at the negotiating table. Thus, if serious peace talks begin soon without Israel's dealing with Hamas first, Hamas will have a political incentive to break the cease-fire -- either directly or by granting groups such as the PIJ more leeway to attack Israel.

And even if Abbas and the peace process were taken out of the equation, formalizing a lasting cease-fire would be risky for Hamas. Doing so would damage Hamas' credentials as a resistance organization. That, in turn, would jeopardize Hamas' funding from Iran and weaken it relative to Abbas, since both would then be tarred with the brush of passivity. Pressure from al Qaeda-like jihadists, the PIJ, and Hamas' own military wing make it hard for Hamas' leaders to renounce violence, particularly openly.

Hamas would also risk alienating elements of the group outside Gaza. The organization has a major presence in the West Bank, where it did well in elections in 2005 and 2006, and much of its leadership and fundraising apparatus is based in Syria and other Arab and Western states. These facets of the organization, which are committed to violent resistance and focus on gaining power in all of historic Palestine, not just Gaza, would have to take a back seat while the emphasis is on Gaza.

All these concerns seemed insurmountable in the past. And although they remain serious, today there is hope that Hamas can be convinced to let the peace process move forward. Its biggest vulnerability stems from its biggest victory: its electoral win in 2006 and takeover of Gaza in 2007. Now that Hamas must govern and is responsible for the welfare of the Gazans, it can no longer simply be a resistance group, criticizing and undermining Abbas and other moderate Palestinian leaders, avoiding responsibility for tough decisions, and gleefully watching moderates get blamed when Israel retaliates for its acts of terrorism. Hamas learned this lesson during Operation Cast Lead, when Gazans criticized it for the devastation the IDF inflicted on Gaza. The Gazan public is firmly opposed to renewing the rocket attacks. The siege has not weakened Hamas' power, but it has forced the organization to become more realistic. Gazans are sick of empty slogans of resistance; giving them a better life will require Hamas to make compromises.

Although the siege of Gaza has weakened opposition to Hamas, it has also prevented Hamas from governing well and from proving to Palestinians in the West Bank and Arabs in general that Islamists can run a government. When Gaza came under Palestinian control in 1994, the poverty rate there was 16 percent, barely above that of the United States. In 2009, 70 percent of Gazans were living on less than $1 a day, according to the UN. Mundane concerns about making ends meet dominate the local agenda. As an International Crisis Group report quoted one Palestinian aid worker, "People in Gaza are more concerned with Karni [the crossing point to Israel] than al-Quds [Jerusalem], with access to medical care than the Dome of the Rock."

Iran, tunnel taxes, and Hamas' fundraising apparatus allow the movement to survive, but they are not enough to make Gaza prosper. Hamas cannot pay for all of Gaza's employees and projects. In the past, it spent money on sustaining its mosques, hospitals, personnel, and military. Now, however, it is responsible for all of Gaza -- a much greater financial challenge. It is also difficult for Hamas to get currency into Gaza; it must smuggle it in from Egypt. Hamas is considering dramatic increases in taxes on cigarettes, gasoline, propane, and other basic commodities, which would dent its popularity. Even Hamas' tunneling infrastructure is at risk now that Egypt -- with U.S. help -- has begun to crack down on the tunnels, building a barrier along its border with Gaza that extends over 20 meters underground.

Perhaps most damaging to Hamas was its failure to emerge from the 2008-9 Gaza war with the aura of victory that Hezbollah enjoyed after its 2006 war with Israel. Hamas' military strategy was poor, as was its implementation. The Hamas official Mahmoud al-Zahar had warned soon before the war, "Just let them try to invade Gaza. Gaza will be their new Lebanon," but Hamas found itself completely outmatched by the IDF and Israel's intelligence services. No Hamas terrorist cells attacked Israel from the West Bank or within Israel proper, and Israel did not lose one tank or one helicopter or suffer one kidnapping. Hamas' rocket attacks tapered off as the conflict ended rather than growing in intensity, as Hezbollah's had in 2006, which allowed Hezbollah to claim it was unbowed when the guns went silent.

Hamas' political weakness outside Gaza also became evident during Operation Cast Lead. Hamas received no significant support from Arab states: most worried that the Islamist opposition in their own countries would get a boost from a Hamas victory. Even Hezbollah gave only rhetorical support, for fear of renewed conflict with Israel. In the West Bank, Abbas was successful in stopping pro-Hamas demonstrations, using the rebuilt Palestinian police and security services to suppress dissent.

Politically, Hamas is beset from all sides, and its leaders worry that they are losing ground. Fatah is always waiting in the wings, with Abbas salivating over any weakness on the part of Hamas. At the other end of the spectrum, the PIJ hopes it can gain support from disaffected Hamas members by claiming the mantle of Islamic resistance if Hamas moves toward a lasting cease-fire. The extreme Islamist position evokes considerable sympathy among Hamas' rank and file, particularly in the armed wing. In August 2009, Abdel Latif Moussa, a preacher in Gaza whose ideology resembles Osama bin Laden's, declared Gaza an Islamic emirate -- a direct challenge to Hamas' caution on this score. Hamas fighters swarmed his mosque, resulting in a shootout that left 28 people dead, including Moussa.

For now at least, Hamas can neither govern freely nor fight effectively, and so it risks losing out to moderates on one side and groups more extreme than itself on the other. Improving the economy in Gaza from abysmal to simply poor would be one victory. So would allowing some Gazans to escape the quarantine the international community has imposed. But to accomplish either of those things, Hamas will have to be willing to make the existing cease-fire more permanent. Doing so would remove the immediate risk of another devastating and embarrassing military operation. Talks with Israel and the rest of the international community, particularly Western officials, would also demonstrate that Hamas is the voice of the Palestinian people in Gaza, and greater legitimacy could bring more aid to Gaza from international organizations and Arab states that so far have shied away from Hamas under international pressure. And if Hamas then managed to govern successfully, it could hope to gain more political power down the road.

DEAL OR NO DEAL?

In order for Hamas to want the cease-fire to last, Israel and its allies must change the organization's decision-making calculus -- a process that will require both incentives and threats, political and military, and, above all, time.

One way to go about this would be for Israel to make a short-term concession on border crossings, allowing the regular flow of goods into Gaza with international, rather than Israeli, monitors manning the crossing points. Israeli intelligence would still watch what goes in and out to ensure that the international monitors did their job, but symbolically the switch would be important. In exchange, Hamas would commit to a lasting cease-fire and agree to stop all attacks from the territory under its control; in other words, it would no longer allow the PIJ to fight in its stead. Hamas would also close the tunnels and end its smuggling. To make the deal more politically palatable for both sides and remove another bone of contention between them, it should include a prisoner exchange that swaps Shalit for Palestinian prisoners. The deal would not require Hamas to officially recognize Israel or Israel to recognize Hamas (which Hamas does not want anyway).

Egypt would have to broker such an arrangement. Like Israel and the PA, Cairo does not want Hamas to succeed: Hamas emerged from the Muslim Brotherhood movement, Egypt's main opposition force, and its success could have an impact in Egypt itself. At the same time, Cairo wants to separate itself from Gaza; it does not want crises there to further damage its credibility by making it look like an ally of Israel in oppressing Muslims.

Such a deal would allow Hamas to claim credit for improving the lives of Gazans, and it could use the resulting increase in the flow of goods to reward its supporters. Also, Hamas' dealings with additional outside actors could widen the circle of those who tacitly recognize Hamas. For Israel, the regular rocket attacks would come to a complete halt and the threat of renewed attacks would diminish, allowing Israelis living near Gaza to resume their normal lives. Hamas' rockets could rust. A cease-fire would also free up Israel diplomatically. If the problem of Hamas receded, Israel could take more risks in the West Bank and give Palestinians more control over security with less fear that this would lead to a Hamas takeover. Meanwhile, Abbas could negotiate with less fear that Hamas might undermine him. Internationally, a cease-fire would reduce, although hardly eliminate, some of the anger at Israel or at least take Gaza off the front pages.

The hope for Israel is that a long-term cease-fire would, over time, produce its own momentum. Peace would push Hamas to emphasize governance more, strengthen the group's moderates, and discourage its leaders from attacking Israel. Hamas' military capabilities might grow, but it would be reluctant to risk any economic improvements in Gaza in another round of fighting. Hamas could crack down on or neutralize groups such as the PIJ and the Salafi jihadists without risking its popular support. Hamas' ties to Iran would diminish -- an important fact for Israel if tension between Tehran and Jerusalem grew over Iran's nuclear program -- and indeed Tehran would be bitter that its stalking-horse had turned away from violence. Finally, a cease-fire that allowed goods to flow into Gaza would make it harder for Hamas to blame all of its constituents' problems on Israel.

HEDGING AGAINST FAILURE

Formalizing the cease-fire with Hamas would raise the question of whether Israel and moderate Palestinians were simply postponing an inevitable fight and allowing the enemy to get stronger in the meantime. There is some validity to this concern. Certainly, the growth of Gaza's economy and the increased flow of goods, such as concrete, that can have both civilian and military uses would help Hamas' military. And Hamas has been taking advantage of the current lull in fighting to better arm and train its forces.

With border crossings open, however, Egypt and international monitors could more easily justify completely halting traffic through the tunnels than they can today, since the goods that would be smuggled would exclusively be contraband. Now, stopping the tunnel traffic is too politically sensitive: with both weapons and consumer goods being smuggled in, it would mean exposing Gazans to the risk of starvation. Privately, even some Israelis and Egyptians recognize that some smuggling should be allowed. But if legal trade becomes possible, there will be no more excuse for smuggling. Whatever military advantages Hamas would gain from the freer flow of trade, moreover, would be small: Hamas smuggles so much through the tunnels today that the relative increase in imports that could have military uses would be less than most Israelis fear. In any event, Hamas would still be a pygmy to the Israeli giant.

Another risk of striking a deal with Hamas is that Palestinian moderates would rightly complain that Israel was rewarding violence: once again, their biggest rival would be benefiting from concessions from Israel without having to accept the political price of peace. And if Gaza's economy improved, the contrast between living conditions there and living conditions in the West Bank would become less stark, which would hurt Abbas politically. Thus, in order to offset any political gains Hamas might make, the international community should encourage Fayyad's efforts to provide law and order, reduce corruption, and otherwise start building a state in the West Bank. This would help make the PA a true rival to Hamas when it came to governance.

Fatah would also benefit politically because Hamas could no longer argue against rejecting violence and talking to Israel; however indirectly, it would be doing these things itself. At the same time, Abbas and Fayyad need the political legitimacy that would come with any success in peace negotiations with Israel. If the settlements grow and the talks stagnate, Hamas' argument that what works is resistance, not negotiations, will only gain force. A deal would also place a heavy burden on the PA to outgovern its rival, which is not necessarily a bad thing. An ideal way to move forward would be by reconciling Hamas and Fatah. For Israel, reconciliation would mean that Abbas could cut a deal for all Palestinians and not have it rejected by Hamas. For now, however, that remains unlikely, and neither peace talks with Abbas nor a cease-fire in Gaza should wait for this.

The long-term success of a cease-fire is far from guaranteed. It will depend on the personalities, preferences, and political positions of Hamas' leaders and on the vicissitudes of Israeli politics. The silver lining, however, is that even failure could have its benefits. Right now, Hamas gains from the perception that Israel and the international community seek to crush the Palestinians. Opening the crossings into Gaza would dispel this impression and place Hamas in a difficult spot politically: it would have to give up either on resistance or on governance.

If the rocket attacks from Gaza resumed or if credible evidence emerged that Hamas was dramatically increasing its military capabilities, Israel would have a strong case for resuming the siege or using force. The international community, therefore, must support not only the idea of formalizing the cease-fire but also Israel's right to retaliate militarily in Gaza if, despite Israel's concessions, Hamas resorted to violence. Such backing would both make success in convincing Hamas to adhere to the cease-fire more likely and give Israel a Plan B should the cease-fire collapse. Failure might also foster splits within Hamas. Currently, the group's leaders disagree over how much to emphasize resistance over governance. Making the choice starker may not force Hamas to abandon resistance, but it could steer relative moderates away from the group.

Hamas is here to stay. Refusing to deal with it will only make the situation worse: Palestinian moderates will become weaker, and Hamas will grow stronger. If the Obama administration is to move its plans for peace forward, the challenge of Hamas has to be met first. At stake is not just the failure of the peace process but also the possibility of another war and of Israel occupying Gaza again.