updated 9/26/2006 4:05:14 AM ET 2006-09-26T08:05:14

A series of crises, not a burst of goodwill, has made long moribund Israeli-Palestinian peacemaking possible again: economic meltdown in the West Bank and Gaza, plummeting popularity for Israel’s prime minister after the war in Lebanon, President Bush’s troubles in Iraq and Afghanistan.

Yet, as much as progress on Mideast peace could help rescue the political fortunes of the Palestinian, Israeli and U.S. governments, renewed peace talks are far from certain.

The Palestinians’ Hamas rulers, while signaling a willingness to share power and honor a cease-fire, aren’t ready to recognize Israel’s right to exist — a key demand of the U.S. and Israel. And Israeli Prime Minister Ehud Olmert may never regain the legitimacy needed for peace concessions.

However, Olmert spokeswoman Miri Eisin indicated Israel might be able to accept something less than full recognition by Hamas, saying her government’s demands were “not etched in stone.” So Hamas’ formula for progress — a new national unity government that would accept statehood in only part of historic Palestine — could be a starting point for easing an international aid boycott that has crippled Hamas’ 6-month-old government.

Assembling a unity coalition, however, is proving to be a challenge because of Hamas’ refusal to recognize Israel. A meeting Tuesday between Palestinian President Mahmoud Abbas of Fatah and Prime Minister Ismail Haniyeh of Hamas to salvage coalition talks was called off because Abbas was enraged that Hamas officials accused him of withholding money from the Palestinian people, senior Palestinian officials said.

Abbas said Saturday that his efforts to form a unity government were “back to zero” after Hamas backtracked on promises to moderate its stance. A day later, however, Haniyeh said Hamas had “serious intentions” to make a unity government succeed, and would re-engage Abbas on the issue.

Economic crisis
The public jockeying has become something of an embarrassment for Abbas, who announced to the U.N. General Assembly last week that any future Palestinian government would recognize Israel.

For Palestinians, it’s much more than a political tussle. The withholding of hundreds of millions of dollars in aid has sent their economy into a tailspin, leaving Hamas unable to pay 165,000 government employees whose salaries support about a quarter of the population.

People are making ends meet by selling jewelry and giving up meat. A workers’ strike has shut half the schools in the West Bank. Electricity rationing has forced many Gazans to break their Ramadan fast in the dark.

A short conversation with Mahfouz Salah, a 62-year-old street seller in Gaza, shows the depth of the crisis.

“The way we survive is by sending out the women to beg at the charity organizations for coupons and flour. The men feel ashamed to go,” he said.

Mohammed Younis, a 23-year-old policeman, said he often doesn’t show up to work for lack of bus fare. He said his family has taken to buying prepared foods.

“We can’t get the money together for the (cooking) gas, so we pay more for food,” he said.

It’s not the first time Palestinians have been through this kind of crisis, and they haven’t totally lost their sense of humor about it.

Hamas, whose members include many men wanted by Israel, has turned all Palestinians into fugitives, said 48-year-old Ramallah resident Ihsam Turkieh.

“We’re not running from the (Israeli) occupation, but from the landlord, the butcher, the vegetable guy. We’ve all become experts at running away!”

Turkieh added: Hamas “is not resisting, not negotiating and not giving out salaries. I guess their policy is just to make hunger.”

The Palestinians aren’t alone in feeling a sense of crisis. Much of the Middle East is in turmoil, with unending bloodshed in Iraq, growing concerns about Iran becoming a nuclear power, Lebanon devastated by 34 days of war and the Israeli government forced by violence to shelve its main policy platform: a withdrawal from the West Bank.

“Usually when you break that many eggs, there’s a whole lot of people dying to see an omelet made,” former President Clinton said last week when asked whether he thought Mideast peace was attainable.

Among those hoping to see progress is Saudi Foreign Minister Prince Saud al-Faisel, who told The Associated Press that Arab countries have reached a “very significant” consensus that the Mideast peace process — in a deep freeze for six years — needs a fresh start.

And in a speech to the U.N. General Assembly last week, Bush said achieving peace in the Middle East was one of the great objectives of his presidency.

Israel flexible
But if peace depends on Hamas recognizing Israel, the world will likely have to wait a long time — the group’s main reason for being is to replace Israel with an Islamic state. A recent poll showed 62 percent of Palestinians believe Hamas should not recognize Israel now.

At the same time, however, the poll showed support for Hamas has now dropped below that of Fatah, and most Palestinians favor a unity government that would respect past accords between the PLO and Israel.

So the question is whether Fatah, Israel and the international community will be able to live with what Hamas can offer: a long-term truce and acceptance of past peace agreements the group deems to be in line with Palestinian interests.

Dennis Ross, a former U.S. Mideast envoy, said that “if Hamas wants the world to deal with it, it has to meet the terms of the world.” But Samir Abu Eisha, planning minister in the Hamas-led Cabinet, said his government has proven through deeds that it respects the rules of the game.

Eisha noted that in six months, the Hamas-led government has not sought to void any agreements, and “we will not do that even for whatever few days or weeks still are left in this government.”

Eisen, Olmert’s spokeswoman, seemed to leave the door open to working with a new Palestinian government even if it doesn’t meet all three international conditions: renouncing violence, accepting past peace treaties and recognizing Israel.

“What we’re saying now is, let’s see what this national unity government is. If it has a different policy, two out of three then we’ll understand, we’ll face it, we’ll decide,” she said.

Olmert's sinking popularity
Progress toward peace could help reverse the slide in Olmert’s approval ratings since the war with Hezbollah, which ended with Israel failing to secure the release of two of its soldiers whose capture precipitated the fighting.

Two polls published last week showed Israelis would vote Olmert out of office if elections were held now, with hawkish archrival Benjamin Netanyahu of Likud poised for a strong comeback.

Movement on the peace front could also help the Bush administration — confronted by rising casualties in Iraq and a resurgent Taliban in Afghanistan — maintain an international coalition for fighting terrorism and containing Iran’s nuclear ambitions.

Whether that would be enough to quell Muslim anger and suspicion about U.S. intentions is an open question.

© 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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