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This all plays into the exceedingly dysfunctional state of Palestinian politics. The Palestinian Authority, dominated by Fatah, rules in the West Bank. Hamas, which is the Palestinian branch of the Muslim Brotherhood, rules Gaza. Naturally Hamas is fantastically empowered by the way the Arab Spring is unfolding. Islamism has shown itself to be the most powerful ideological and political force in the Middle East.

Hamas is a terrorist organization which rejects Israel's right to exist and is pledged to its destruction. It is inevitable Hamas will find the new Egyptian government more sympathetic and helpful in every practical way than was the old Egyptian government.

In some ways, as one analyst put it to me, Gaza has invaded the Egyptian part of the Sinai Desert, which borders Israel.

The whole Western strategy towards the Palestinian over the past few years has been to try to improve life in the West Bank, because the leaders there seem willing to compromise, in contrast to life under the extremist Hamas in Gaza.

But Hamas has had its share of victories. It kidnapped an Israeli soldier, Gilad Schalit, and kept him cruelly isolated for five years. Eventually, Hamas won the release of 1000 Palestinians, many of them murderous terrorists, in exchange for Schalit. This gave Hamas great kudos and seemed to demonstrate that violence and terrorism work.

Meanwhile, with all the aid the PA gets, it delivers very little and can barely meet its payroll.

Hamas is in the midst of a fierce internal debate over whether it should temporarily abandon armed struggle. Its Damascus-based leadership reportedly favors this while its Gaza-based leadership wants to continue the tactics that have brought it success so far. It certainly wants to maintain its monopoly of power in Gaza. For all that, Hamas is not carrying out serious violence at the moment. This is partly because of the prospect of Palestinian elections this year.

There have been talks this week between the Israelis and the Palestinians in Jordan. But it is impossible to believe these talks will lead to a peace agreement. Almost more fraught than these talks are the internal Palestinian negotiations between Hamas and Fatah. Having some years ago fought a deadly civil war, the two groups recently announced a reconciliation. Yet this week Hamas would not allow Fatah's representatives to travel to Gaza. In truth, the two groups hate each other.

So how can there be a Palestinian state when the two parts of it have recently been killing each other and cannot even travel in each others' territories? Palestinian friends tell me that Hamas would be likely to win a Palestinian election held now. Neither Fatah nor Hamas is remotely democratic. Fatah is also increasingly sclerotic. All its leaders are aged, all figures from the past in office for decades. There is no youth or vitality about it.

Further, Israel quite reasonably says it won't negotiate with an organization formally pledged to its destruction. So if Hamas and Fatah do reconcile, and Hamas enters a Palestinian government, that too rules out a peace agreement for a long time.

Ultimately, Israel won't make a peace deal unless it believes a Palestinian government can govern its territory effectively, provide law and order there and prevent attacks on Israel from Palestinian territory. That is inconceivable today and all the trends of the Arab Spring make it ever more unlikely.

That is not to say it is worthless to have a peace process. The two sides need to be talking. Not only that, I have become convinced it is vital for the Palestinians to have a political horizon, a political road, an acknowledgment that everyone accepts that they should have a state eventually.

So having peace talks is a good development. But don't expect a deal any time soon. To pretend otherwise raises unreal expectations and that alone can have dangerous consequences.