After eight days of clashes, Hamas' claim that it is the true leader of the Palestinian resistance has gained strength. Long-range rocket attacks on Tel Aviv and Jerusalem have made Israelis increasingly wary of a two-state solution.
And the deaths of 140 Palestinians, one-third of them combatants, compared to five Israelis, one of them a soldier, will be seen across the Middle East as US-abetted Israeli aggression.
Don't expect those dynamics to improve anytime soon.
In the months ahead, Hamas' popularity among Palestinians is likely to rise. The Fatah faction of Mahmoud Abbas will be seen as increasingly impotent. And Israeli Prime Minister Binyamin Netanyahu's conservative government will likely fare well in January's parliamentary elections.
As so often happens in conflicts, one side's right wing abets the other's.
The last eight days have brought a number of subtle shifts that make peace seem more distant than ever. From where I sit, here are the major changes:The rise of the rocket:
As Jeffrey Goldberg pointed out in Bloomberg View on Monday, this may represent the beginning of the "third Palestinian intifada." In this round, rockets are the weapons of choice, replacing the stones of the first intifada and the suicide bombers of the second.
While much has been made of Israel's vaunted "Iron Dome" defense system, it is not a cure-all. Even if Israeli missiles prevent deaths, hundreds of missiles being fired at Israel from the Gaza Strip or southern Lebanon does not create stability in Israel.Mursi passes his first test:
Outside Hamas and Netanyahu, the most empowered new player in the region may be Egyptian President Mohamed Mursi. Whatever his true loyalties, the Muslim Brotherhood leader threaded a diplomatic needle.
He convinced Hamas to agree to a ceasefire and won praise from American officials. In a phone call today, Obama thanked Mursi "for his personal leadership in negotiating a ceasefire."
And at a Cairo press conference announcing the agreement, Hillary Clinton hailed the Egyptian leader for "assuming the leadership that has long made this country a cornerstone of regional stability and peace."
Lauren Bohn, an American journalist who recently moved from Cairo to Jerusalem, pointed out that the Egyptian public showed little reaction to the conflict. Last Friday, several thousand Egyptians joined anti-Israeli street protests, a relatively small showing.
Twitter traffic in Egypt focused on liberal politicians' decision to walk out of the country's constitutional assembly and a horrific bus accident that killed up to fifty children in the country's south.
While Egyptians remain hugely sympathetic to Palestinian cause, they appear eager to get their economy and country in order as well. That represents a potential opening for the USA failed and false pivot:
Gaza made a mockery of Obama's "pivot to Asia."
As my Reuters colleagues Matt Spetalnick and Jeff Mason pointed out in an excellent piece yesterday, Obama's Asian tour ran aground due to the difficult political realities of Asia, not just the Middle East. The administration made little headway on China and other fronts an that Asia presents intractable diplomatic challenges of its own.
Whether one agrees with the policy or not, the United States is Israel's prime military, financial and diplomatic backer. We can pretend that we are disengaging from the Middle East, but we will still be seen around the world as responsible for Israel's security - and its actions.The odd couple:
Although bitter enemies, Egyptian President Mursi and Israeli Prime Minister Netanyahu have one common interest: containing militancy in Gaza and Sinai.
After Salafist militants in Sinai killed 16 members of Egypt's security forces in August, Mursi launched a sweeping crackdown. While publicly assailing Israel and praising Hamas, Mursi continues to face a political threat from right-wing Salafists in Egypt who call for the imposition of hard-line Islamic law, oppose democracy and support violence against Israel, steps Mursi insists he and the Brotherhood oppose. Mursi also desperately needs aid from the US and Europe to revive Egypt's stalled economy and prevent political unrest at home.
Many Americans and Israelis continue to suspect that Mursi and the Brotherhood are closet Salafists. So far, Mursi's actions have not shown that. As long as Mursi continues to uphold the peace treaty with Israel, embrace democratic norms and renounce violence, American officials should continue to work with him.The centrality of the settlements:
Jeffrey Goldberg made another good point in his piece: Israel's continued construction of West Bank settlements has undermined Fatah and strengthened Hamas.
As Israeli settlements spread, Fatah has nothing to show for its two-state approach. James Dobbins, a former senior American diplomat and Rand Corporation expert, called on the Obama administration to re-adopt the tough stance it took on West Bank settlements early in its first term. That is the only way, he said, the United States can appear like a neutral arbiter in the region.
"The administration made it clear that it opposed the settlements and declared them illegal," Dobbins said in an interview today. "It may have to revert to that harder line and hold it this time."The American role:
The second Obama Administration cannot dictate peace to Israelis and Palestinians. In the short-term, both sides are unlikely to show flexibility. But the eight-day battle showed that neither Israel nor Hamas will achieve victory in the long-term. Hamas cannot militarily defeat Israel. And Israel cannot eliminate the threat Hamas represents. Dobbins argues that after Israel's January elections, Clinton's successor should quietly work to re-start peace talks.
He is right. In many ways, the conflict itself remains intractable.
But the region around Israel and the Palestinian territories is undergoing historic changes. Whatever his true feelings, Mursi proved to be surprisingly pragmatic. Someday, Israelis and Palestinians may also do the same.
The only outcome that will undermine Hamas and secure Israel is a two-state solution. Success is unlikely but it is in the US' interest to pursue it. American passivity and pessimism will only aid hardliners on both sides.The author is an investigative journalist for Thompson Reuters.
For now, the fighting has stopped in Israel and Gaza. But let's be honest, this is the latest round in a long and bitter struggle. In the future, more bloodshed is likely.