In recent weeks, fighting between the two main Palestinian parties, Fatah and Hamas, has resulted in more than 100 deaths, raising once more the spectre of civil war.
Israel and the US are backing Fatah, led by president Mahmoud Abbas, against the democratically elected Hamas government.
Israel and the West’s economic embargo on the Hamas government has resulted in a slow strangulation of the economy and an intensification of Palestinian suffering.
The justification for this was threefold – Hamas’s refusal to recognise Israel’s “right to exist”, to formally renounce violence and to accept previous agreements with Israel.
In the light of Israel’s contempt for a Palestinian state, why should Hamas recognise Israel, thus giving up its major bargaining counter?
The demand that Hamas renounce violence seems out of touch with reality in the light of Israel’s extreme violence towards the Palestinian people. In 2006, Israeli forces killed 660 Palestinians, more than three times the figure for 2005, compared to the deaths of 17 Israelis.
The outbreak of the second intifada, or uprising, in September 2000 was the first nail in the coffin of Israel’s strategy of using the Fatah leadership under the late Yasser Arafat to keep the Palestinians in check.
The second nail was Hamas’s electoral victory in January of last year.
Israel worked hard to provoke attacks by Hamas, which had held to a 17-month self-imposed truce. Last June, Israel finally succeeded.
Its forces killed 30 Palestinian civilians and assassinated a Hamas leader in the Gaza Strip. Palestinian fighters fought back and captured an Israeli soldier.
This served Israel with pretext for a massive retaliation – destroying the main power station, roads and bridges.
It also closed crossing points into Gaza, blocking off food supplies and threatening mass starvation.
Israel hoped to turn the Palestinian people against Hamas. It believed that by wrecking Hamas it could claim it had “no partner for peace”.
Israeli prime minister Ehud Olmert could then implement his plan for a unilateral imposition of “final” borders, annexing vast swathes of Palestinian land.
There are clear signs that Fatah is complicit in Israeli and Western attempts to destabilise the Hamas government.
Given Hamas’s refusal to capitulate, the old strategy is being revived. After succeeding Arafat as Fatah leader, Mahmoud Abbas was, like his predecessor, sidelined.
In recent weeks, however, Israel and the US have been building him up and encouraging him to stage a coup.
Last December, with the failure of successive attempts to form a national unity government, Abbas called for fresh elections.
This was a day after US secretary of state Condoleezza Rice promised to try to persuade the US Congress to back Abbas with additional funding.
Fatah members attempted to assassinate Hamas prime minister Ismail Haniya as he tried to return to Gaza carrying donations from Middle East governments.
Muslim countries, in particular Iran, have pledged £500 million in aid, testifying to Hamas’s success in breaking the Western embargo without political capitulation.
It is clear to most Palestinians that Abbas does not have the authority to call fresh elections.
Even if he did, they are unlikely to produce a different result, given the failure of his policy of conciliation to win any serious concessions from Israel.
Olmert has also been persuaded to release a fraction of the £300 million tax revenues owed to the Palestinian Authority. The idea is to undermine Hamas by allowing Abbas to get the credit for this.
Israel and the US are trying to fan the flames of conflict between Hamas and Fatah, in the belief that civil war would result in a Fatah victory. The US has pledged $86 million to strengthen Fatah’s security forces.
Meanwhile, ordinary Palestinians have engaged in new methods of non-violent resistance to Israeli attacks.
In November, hundreds of Palestinians gathered around houses in the Jabaliya refugee camp in Gaza which was threatened with destruction by Israeli air strikes, forcing the Israelis to call off the attacks.