PALESTINE — Even in the face of possible economic collapse, Hamas leaders want to figure out a better way to collect garbage in Gaza. The Islamist movement, which now controls the coastal strip, is working out ways to create new jobs and reduce petty crime.
A new enthusiasm has swept through this territory in the aftermath of the violent split in June between the two Palestinian factions. Among many young Gazans there is excitement for a Palestinian enclave that fully embraces the principles of their Islamic Resistance Movement without the interference of Fatah rivals.

“We’ve taken control, we’ve gotten rid of people who were collaborating with Israel, and we’ve restored order,” says Khalil al-Haja, a mid-ranking member of Hamas Qassem Brigade militia. “Abu Mazen [Palestinian President Mahmoud Abbas] will eventually have to realize that we’re here to stay. In six months, we’ll be reunited.”

While that vision may indeed be only a Hamas dream, the good spirits among Hamas officials in Gaza are in stark contrast to the low morale of their Fatah counterparts.

In talking to Fatah members in the West Bank, a picture of despair, disorganization, and exhaustion emerges, not only due to what they feel was a humiliating defeat at the hands of their rivals but because Fatah as a movement appears to be losing touch with its own ideological moorings.

The differences call into question the current U.S. strategy for dealing with the Palestinians: give Mr. Abbas legitimacy, prod the Israelis to improve daily life in the West Bank, and isolate Hamas in an economically desperate Gaza.

Though Gaza’s economy is weakening, there is every sign that Hamas is inexorably bolstering its position.

“Audiences in the US have a strong feeling of black and white and they’re betting on which side will win based on whether it agrees with them,” says Mouin Rabbani, an analyst at the International Crisis Group. “But there’s an issue that is overlooked: The virtual disintegration of Fatah.”

Neither side has shown themselves to be paragons of democracy. In the West Bank, hundreds of Hamas activists have been jailed for their political beliefs since June, gunmen out of uniform are frequently seen on city streets, and the local security forces are seen by many average citizens as unruly thugs.

In Gaza, while unarmed volunteers untangle crippling traffic, there have been recent indications that the Hamas-controlled security forces are growing more thuggish. In the past week, they have arrested at least 11 Fatah activists and, on Monday, forcibly tried to disperse a pro-Fatah protest.

Hamas’s Executive Force, an offshoot of its Qassem Brigade militia that now acts as the strip’s de facto police, has stepped up its own brand of political repression. On Monday, the group said all political demonstrations in Gaza would require licenses before being allowed to go ahead, and the group also recently closed a Fatah-controlled radio station.

Over the weekend, a fight broke out between Executive Force members and guests at a Fatah wedding party. Hamas said it took action because gunshots were fired at the wedding (Hamas has tried to ban this tradition since falling bullets frequently kill bystanders); Fatah supporters said they had merely been singing pro-Fatah songs.

Ahmed Yousef, a senior adviser to Hamas leader and former Palestinian Prime Minister Ismail Haniyeh who lived for decades in the U.S., argues that the “coup” in Gaza, as Fatah calls it, was in fact a preemptive strike against a take-over plan by Fatah members loyal to Mohammed Dahlan, the former Palestinian security chief and notorious Gaza strongman.

“Our No. 1 priority was, and is, strengthening law and order, and the [Mohammed] Dahlan group knows that when that happens their corruption, conspiracies, and abuse of power would be revealed.”

Mr. Yousef says Hamas uncovered documents that prove rampant theft by Mr. Dahlan and other Fatah leaders from the movement’s sacked offices in Gaza, though he declined to provide them. “We have all the facts for now, and the people expect us to reveal something, but sometimes the wiser course is to make the argument in private.”

Indeed, corruption is the accusation you hear leveled at Fatah again and again from talking with Palestinians in the West Bank.

Despite anger among many Palestinians at Hamas for the Gaza takeover, in which some Fatah activists were executed, the Islamist movement is still seen overwhelmingly as the more “clean” faction, the reason that so many Palestinians voted for Hamas in the January 2006 elections.

“We lost our way years ago,” says Azzam al-Ahmad, a former deputy prime minister and Fatah member in the Palestinian parliament. “Too much corruption was tolerated in our ranks, and now we have to find a way to rebuild.”

Qadura Fares, a member of Fatah’s young guard, is more blunt. “Fatah needs radical surgery, but the patient is very frail. If you meet with 200 Fatah representatives, they’ll all tell you the same thing. Corruption is our big problem. But, of course, some of those 200 are among the corrupt. Are they going to give up their positions? It doesn’t look like it.”

And while one adviser to the Bush administration says that when Fatah leaders come to Washington they invariably talk about what the U.S. should do to weaken Hamas, rather than present new initiatives to further the interests of the Palestinian people, Hamas’s leaders say they are mostly focused on their responsibilities at home.

Yousef says Hamas has started providing $100 a month to 20,000 of Gaza’s poorest from its own coffers (although he still says Hamas is receiving outside financial support) and that the movement has made great strides in getting gunmen off the streets.

Perhaps Hamas’s greatest success so far has been in disbanding criminal clans, most visibly the Dugmush clan, which claimed responsibility for kidnapping and holding BBC reporter Alan Johnston for more than three months earlier this year. Today, many shopkeepers say they no longer have to pay the protection money once demanded by criminal clans.

“We’ve made the consequences very clear to the clans if they don’t keep their weapons at home,” says Islam Shawan, the spokesman for the Executive Force. “We still have four of the men involved with Johnston’s kidnapping in custody and will arrest more if we have to.”

As for any movement toward new negotiations between the two rival Palestinian factions on a possible new unity government, “We made some mistakes, we know that, and we’re ready and eager to talk,” says Hamas’s Yousef.

Mr. Ahmad of Fatah holds a very different position: “Until all the results of the coup are overturned, no discussions will be possible.”

Editor’s note: The British government should talk to “moderate elements within Hamas” and push for the restoration of a Palestinian national unity government, a parliamentary report in London recommended this week.

The report by the Commons foreign affairs select committee argues that Western sanctions against Hamas, for its refusal to renounce violence and recognize Israel, have been “counterproductive.”

The MPs believe that Tony Blair’s appointment as the special envoy for the diplomatic Quartet (the U.S., the U.N., the E.U. and Russia) provides an opportunity to open up contacts with the Palestinian movement. “We recommend that he engage with Hamas in order to facilitate reconciliation amongst Palestinians,” the report says.

A Foreign Office spokesman said: “We have made clear that we will respond to significant movement by Hamas. We have not said that we will never talk to Hamas. But there have to be some ground rules.”