In May and June of 2011 I wrote about the reconciliation between Fatah and Hamas. The two sides have been jockeying for political positions for the last few months and have not been able to agree on a structure for the new unity government. But just last week the two sides broke the political impasse and agreed to make Abbas that the head of the proposed unity government, a government that tries to join the secular Fatah party with the Islamist Hamas party. Abbas will be both president and prime minister and the current Palestinian Prime Minister Salam Fayyad will move on because he is so disliked by Hamas who consider him to be far too pro-Western. There is much work to be done yet before these two groups actually reconcile or form what might be legitimately called a unity government, because these two groups have a history of disliking each other pretty intensely.

But a more intriguing question is “what should the role of Israel be or the attitude of Israel be about the proposed unity government?” Publicly, Israel holds its nose at the whole thing. They consider Hamas a terrorist organization and will have nothing to do with them. Netanyahu is on record as opposing the formation of a government reconciling Fatah and Hamas. In June of 2011 I wrote the opposite, that such a reconciliation might be a good thing because Hamas will be forced to moderate itself. Some certainly considered my position naïve but I will hold my ground by maintaining that no progress cannot be made without unity between Fatah and Hamas and without Hamas doing its share of moderating.

The received Israeli position is that Hamas is a radical movement guided by an ideology directed toward the elimination of Israel. Moreover, inclusion of Hamas in any negotiations would simply make it easier for them to reject a proposed resolution to the Israeli-Palestinian conflict. There is also fear that rather than Hamas moderate itself, Hamas will bore itself into the Palestinian authority and contaminate its ideology. If this happens there has been lots of saber rattling about what damage this will cause to the Palestinian Authority. But such damage will be minimal because there is no peace process anyway, and the maintenance of the Palestinian Authority is in the interest of both Israel and the United States.

There are some very good hard-core reasons to deal with Hamas: Hamas controls the Gaza Strip and if you want to do business in the Gaza Strip, if you want to sign agreements regulating political behavior, then you must do business with Hamas. Too, there is a good chance that the “Arab spring” will help usher in Muslim political parties and consequently enhance Hamas’s power. As more countries integrate Muslim political parties into the governing body, the more groups like Hamas take on legitimacy. Egypt has already taken a softer attitude toward Hamas and this is assumed to be the result of successful elections for the Muslim Brotherhood. Any movement towards solving the Israeli-Palestinian conflict is going to be gradual and include partial and limited agreements. A reconciliation between Hamas and Fatah will more than likely facilitate a gradual process, where small and limited agreements can flourish, rather than hinder conflict resolution. A unity government encourages progress – small as it may be – that does not require Hamas at this point to recognize Israel, nor Israel Hamas.

Increasingly analysts and pundits have argued that engaging Hamas will have the desired moderating effect. It will encourage moderates on each side and stimulate more debate. But Israel remains a problem, as does Hamas, because it still refuses to deal with Hamas. And this might be a particularly difficult problem because of Netanyahu who seems bent on preventing a two state solution and can use the recognition of Hamas to his advantage. This plays directly into the hands of the Palestinians who believe that Israel’s rejection of unity between Hamas and Fatah is part of a grander plan to prevent the two state solution.

Unity is still far off. And the loss of Mr. Fayyed is considerable because he was more oriented toward Western values. But a shift in the center of gravity for the Palestinians is coming. Let’s hope the shift is in the right direction.