Writing on the wall

Few have the nerve to barge in like Dan Kurtzer. If he wanted something off his chest, he'd march into the highest office in the land. In the mid-1980s, as a US diplomat in Tel Aviv, Kurtzer did not like what he saw in Gaza.

"Have you guys lost your minds?," he yelled at then prime minister Shimon Peres's most senior advisers. "Don't you ever learn from history?"

It was apparent to Kurtzer that Israel, despite denials, was nurturing an emerging Islamist movement in Gaza as a foil to Yasser Arafat's secular Fatah movement. "The Islamists were OK as long as they were not shooting and bombing," an official who was stationed in Gaza in the early days of the Israeli occupation explained in a recent interview. Back in 1985, Kurtzer thought the Israelis were kidding themselves.

The feisty American's previous posting had been Cairo - he was there in 1981 when Islamists assassinated President Anwar Sadat. He was monitoring a new group called Hezbollah which had emerged in Lebanon - also Islamist and tied to Iran. "You really think you can tame these guys," Kurtzer asked in disbelief as he left the prime minister's suite.

The first Islamists in Gaza came from the ranks of the Muslim Brotherhood, an Egyptian organization founded in the 1920s which, despite serial repression by the Cairo authorities, has become a powerful opposition force in Egypt. Hamas emerged from their ranks in the chaotic early days of the First Intifada, the Palestinian uprising that began in December 1987.

In providing space for the early Islamists to take root and grow at the expense of Arafat's Fatah organization, Israel's occupation authorities helped launch an intra-Palestinian conflict, the ferocity of which now puts at risk the Palestinians' most powerful weapon in their struggle with Israel - an enduring sense of national unity which has held solidly since 1948.

In renouncing violence and recognizing Israel, the Arafat-controlled Palestine Liberation Organization won a berth in the so-called Oslo peace process. Working with Israeli forces and egged on by Washington, Arafat went to war against the Hamas fundamentalists - who refused either to end violent resistance or to acknowledge Israel's right to exist.

Along the way, spectacular mistakes were made with all the conviction and certainty that the key players evince in this latest Gaza crisis, a convulsion which is as much about Washington and Tel Aviv's urge to have the faltering remnants of Arafat's Fatah triumph over Hamas, as it is about Israel's urge to keep the Palestinians in their place.

The Israelis were convinced they were on the right track in the early 1990s when they deported hundreds of key Hamas figures to south Lebanon, where they immersed themselves in explosives and other combat training with their Hezbollah comrades.

In 1997, Arafat and the Israelis had Hamas pinned down, to the point that Martin Indyk, then serving as American ambassador in Tel Aviv, concluded that the Islamists were "getting screwed". Hamas's two top leaders were in jail - one in the US and one in Israel - and Arafat was rounding up Islamists by the thousand.

By then Benjamin Netanyahu was Israel's prime minister and he decided with great certainty that he should assassinate a third leadership figure - Khalid Mishal. The attempt was bungled so spectacularly that Hamas was able to revive and survive.

Then Arafat became the problem and Mossad, under its director Efraim Halevy, came up with a grand plan, bought by the Bush White House, to force the autocratic Arafat aside in order to make way for the very feeble Mahmoud Abbas as leader of the Palestinian people.

Amid suspicion that he was a Washington puppet, Abbas desperately needed to show he could deliver for Palestinians where Arafat and Hamas had failed. Israel's "disengagement" from Gaza in 2005 was a perfect opportunity for him to be seen to negotiate a breakthrough - but Israel withdrew unilaterally, leaving Abbas high and dry. This was about the time we started to hear of the Arab Spring. Remember in the aftermath of the first post-Saddam elections in Iraq how Bush wanted Palestinians to prove democracy indeed was on the march in the Middle East?

Israel pleaded with Washington to block Hamas from standing candidates. Instead, Bush listened to Abbas, who argued he would be better placed to deal with Hamas after Fatah triumphed in the January 2006 election. Problem was Hamas triumphed at the poll.

So affronted was the world that the Hamas government was put in a deep freeze until it renounced violence and recognized Israel. In the meantime, many of its MPs were locked up by Israel and essential aid was cut to a trickle.

Quietly, Washington and Israel opted for a coup. If they could not get Abbas as president of the Palestinian Authority to sack the government elected by the Palestinian people, they would - along with the European Union - fund, train and arm Abbas's security forces to drive Hamas from its Gaza stronghold.

Keith Dayton, the American general who readied the Fatah forces for war, spoke prophetically of a battle "like never before". His men were whipped in a matter of days.

For all that, Hamas's absolute rule in Gaza was a poison chalice. Isolated from the world and besieged by Israel, it got the stick while Abbas and the West Bank benefited from the foreign-aid carrot - stopping short of effective pressure on Israel to lift the hundreds of road blocks drastically containing Palestinian movement.

Management of the often high-octane conflict between Israel and Hamas remained the focus of regional attention; in the background the friction between Hamas and Fatah was equally corrosive.

Propped up by Washington, the EU and Israel, Abbas might have been expected to have a good war. But there are signs he is being punished for his early rhetoric which, like that from Cairo, gave comfort to Israel.

Abbas's right even to hold office as President of the Palestinian Authority came under a cloud as of yesterday, with formal expiration of his four-year term which, before the Israeli assault on Gaza, had prompted Hamas to warn that from this weekend it would cease to recognize Abbas as Palestinian leader.

A key field of battle between Fatah and Hamas is for the leftovers of the PLO. Hamas has been accused of attempting a hostile takeover for the organization.

But this week, Hussam Khader - one of the Fatah young turks trying to wrest control of the faction from Abbas's generation - was quoted: "Hamas will be stronger and Fatah weaker … after this war [in Gaza] Hamas will lead the PLO."

In Nablus, on the West Bank, long-time Fatah stalwart Abdel Ghani Marmash vowed to switch sides. "I was arrested 19 times by the Israelis [as a member of Fatah]," he said. "But at a time like this, all Palestinians are Hamas. Today I'm honored to follow the Hamas flag."

The current crisis has prompted calls from the likes of John Bolton, a former US ambassador to the UN, to abandon the two-state solution and hand the West Bank to Jordan and for Gaza to come under the aegis of Egypt, as it was from the time of Israeli independence in 1948 through to the Six-Day War in 1967.

Bolton believes that despite their reluctance, Amman and Cairo could be bought with aid funds. But Cairo treats Gaza like toxic waste because of the Muslim Brotherhood.

Egypt does not want any of the Gaza foment spilling over the border, especially after the chaos in January last year when Hamas blasted away sections of the border wall and fence to allow thousands of Gazans to go shopping in Egypt for a few days.

Conscious it must please a Washington which delivers almost as much aid to Egypt as it does to Israel, Cairo pitched in to keep its border with Gaza closed during the latest Israeli lock-down. This week Egyptian officials intimated they would reopen the Gaza border only if the crossing was manned by Abbas forces, not Hamas.

"We believe Hamas is going to stay [in power in Gaza], but we want it to stay in a way that would not harm [Abbas] legitimacy or harm us," Gihad Auda, a member of Egypt's ruling party, said during the week.

These are fluid days for Hamas. It controls Gaza where, this week, it was accused of executing Fatah members who it alleged collaborated with Israel.

Meanwhile, on the West Bank, Hamas supporters are being rounded up and jailed by Abbas's Fatah forces. Both factions ended up in a slanging match over whose approval was needed for Gazans to make the pilgrimage to Mecca.

Because Iran is a key backer, Hamas finds itself with less support than in the past from regional heavyweights like Saudi Arabia and Egypt, both of which got away with treating the Bush drive for democracy with contempt because ganging up on Iran was a higher calling.

Herald chief correspondent Paul McGeough's new book, Kill Khalid: Mossad's Failed Hit … And The Rise Of Hamas , will be published early in March by Allen & Unwin.