The bad or the worse

The outburst of violence in and around Gaza puts Israel's government in an unbearable dilemma: should it invade Gaza, to halt the Palestinian rocket fire and oust the Hamas government, or try to negotiate a stable ceasefire with Hamas. Both options carry high political and strategic risks, and the outcome will set the course of Israeli-Palestinian relations for the foreseeable future.

In the eyes of most Israelis, the seeds of the fighting were sown by the Israeli pullout of Gaza in August 2005. It was morally and strategically right. But Israel failed to disengage itself from Gaza. Palestinian terrorist groups kept firing rockets into Israel, and Israel remained responsible for Gaza's wellbeing.

The rocket barrage turned life on this side of the Green Line into a nightmare. Then the second Lebanon war of summer 2006 put the north of Israel under rocket fire from Hizbullah. Many Israelis felt that their country was shrinking, and only the area around Tel Aviv remained relatively safe from rockets.

This has far-reaching implications for any peace process. Israel evacuated south Lebanon and Gaza, and both were turned into launching pads for rockets. A West Bank withdrawal could put all of Israel's populated areas within rocket range. It would make life in Israel unbearable. So, as long as there is no credible response to the rockets - either through a reliable security force to prevent their launch, or technology to intercept them in the air - any territorial change appears unreasonable.

As the rockets kept flowing and Hamas kept arming, pressure was mounting on the Israeli government to invade. But Ehud Olmert, the prime minister, and Ehud Barak, his defence minister, have been reluctant. Time for hesitation is running out, however, as more and more Israelis are falling within hitting range. Olmert has to choose.

He can try to negotiate a ceasefire with Hamas. In a recent Ha'aretz poll, 64% of Israelis supported talks with Hamas on a ceasefire and prisoner exchange. The arguments for talking to Hamas are compelling: a quiet period may lead the organisation to moderate and politicise itself; Hamas has proved more disciplined than Fatah in respecting ceasefires; and Hamas doesn't ask Israel for a final peace deal - it suffices with a long-term truce - which is safer politically for Olmert. But the government is reluctant to reverse its course, forgo its efforts to isolate and bring down Hamas, and admit its strategic failure and weakness.

Olmert fears that by recognising Hamas, Israel will be practically dismissing the president, Mahmoud Abbas, and what remains of the Palestinian moderate camp. Instead, Israel will have to deal with a rejectionist regime that refuses to recognise the country's legitimacy.

The other option, invade and occupy Gaza, is even riskier. It would entail many casualties among Israeli soldiers and Palestinian civilians, and Israel lacks an exit strategy. Nobody is eager to take responsibility for Gaza, and the prospect of controlling the lives of 1.5 million Palestinians is a nightmare for Israelis.

So Olmert is trying desperately to buy more time with limited military operations, while pledging to keep peace negotiations going with Abbas. Olmert's pledges to end the rocket fire ring hollow. The Israeli media and the public are challenging him to order "the large ground operation". Cabinet ministers suggest bombing the site of rocket attacks even if they are in civilian neighbourhoods. Olmert has to choose between the bad and the worse.

In the Arab-Israeli context, wars happen when governments and organisations feel they must deliver on unfulfilled pledges. That is why further escalation appears inevitable - with far-reaching implications for the Middle East's future.