Israeli leaders may gain political capital from operations in the Gaza Strip [EPA]

As the economic situation in the Palestinian Gaza Strip becomes untenable, a military showdown, which could have dire regional consequences, is becoming inevitable.

The Gaza Strip has been marred with tension, turning it into the focal point of challenge to Israel since the latter withdrew its army and settlers in 2005 and the Islamist Hamas took control of the region after a violent confrontation with secular Fatah.

As Hamas continues to hold Israeli soldier Gilad Shalit prisoner, the Israeli blockade has turned the over-populated Strip into a large prison.

It has also led to near-starvation among the 1.5 million overwhelmingly poor and young population, 70 per cent of whom are under 30 and 85 per cent of whom are refugees.

Although Al Jazeera is the only TV outlet broadcasting internationally out of Gaza, the Arab world is awash with images of children found at both hospitals and rubbish dumps.

And yet, in spite of the dramatic deterioration in health and the standard of living, it is the security escalation that preoccupies most people's minds. The ceasefire between Israel and Hamas ends on December 19 with little enthusiasm to renew it on either side.

Jailed legislators

More than 500 Palestinians have been killed since the ceasefire began in July. And tens of elected Hamas legislators remain in Israeli jails accused of inciting violence and terrorism.

Hamas, which headed the last Palestinian government in 2006, accuses Israel of cracking down on its supporters in the West Bank.

It demands that any future ceasefire must include all the occupied Palestinian Territories - a condition unacceptable to Israel.

The attack last week by Jewish settlers on Palestinian homes in Hebron, in the West Bank - what Ehud Olmert, the Israeli prime minister, termed a "pogrom" - will only fuel tense relations with the Palestinian Territories.

With the proximity between armed Jewish settlers and Palestinian West Bank residents measured in metres rather than miles, the violence is taking a communitarian turn in the shadow of the occupation.

The Israeli government blames Hamas for the escalation and for rockets fired into Israel form the Gaza Strip in recent days.

Israeli generals say that Hamas is capable of launching home-made, longer-range rockets that could reach as far as Ashdod and perhaps Beer Sheva, the largest town in the southern part of the country.

'Unavoidable confrontation'

Those advocating a military invasion or the reoccupation of Gaza, think that the confrontation with Hamas is unavoidable sooner or later.

They argue that while an invasion would be costly today, it will be costlier tomorrow, after Hamas and the smaller Islamic Jihad faction continue to recruit, train and arm new fighters.

The security pretext for showdown in Gaza has also become a useful tool in the upcoming February elections.

Both Tzipi Livni, leader of the ruling Kadima party, and Ehud Barak, the Labour head, are down in the polls - which predict that Benjamin Netanyahu, the Likud party's leader, as the likely winner in the next elections.

The two coalition partners have little to lose and much to gain from intensified military action against Gaza if it allows them to underline their security credentials.

This is especially the case for Barak - also the current minister of defence - whose party is expected to win no more than 10 seats. Such a poor result would threaten the very existence of the party that founded and governed the state during all of its first three decades.

Netanyahu has threatened to rid Gaza of Hamas' hold as soon as he becomes prime minister.

His populist agenda pushes Labour and Kadima closer to making such an operation themselves before, rather than after, the elections.

No solution

A military solution for the Gaza Strip will prove to be no more than wishful thinking that will lead to more rather than less radicalisation of the Palestinians.

It is estimated that there are thousands of Palestinian armed fighters entrenched in populated areas, many of them trained and willing to conduct a tough fight as seen by Hizbollah after the 2006 Israeli invasion of Lebanon.

Egypt, which has been feeling the heat of tension and radicalisation more than any other government, has so far failed to mediate between Israel and Hamas as the fragile ceasefire continues to be violated.

Cairo has also tried to bring back its presidential security forces to the Gaza-Egypt border in order to pave the way for the lifting of the Israeli blockade.

But failure to normalise relations between the two leading Palestinian factions or integrate their security forces is blocking all such moves.

With Hamas' relations with Egypt, Saudi Arabia and Mahmoud Abbas, the Palestinian president and Fatah leader, Israel reckons it is doing everyone a favour by removing Hamas from power and handing Gaza to Abbas' security forces.

High casualties

A military invasion of the heavily armed Gaza Strip will lead to high casualties not only among Palestinians, but also among Israelis.

Escalation in the occupied territories will end up compromising any chance for energising the diplomatic process at the dawn of a new US administration.

Barack Obama, the US president-elect, has long accused Hamas of terrorism and refused any contacts with the group until it "renounces" terrorism and accepts all other Quartet conditions including recognition of Israel.

But the new US administration needs to find ways to communicate with all those involved or capable of defusing tensions, sooner rather than later.

Otherwise, a showdown in Gaza will leave the Obama administration with a big humanitarian and strategic mess on its hands in its first days in office. If this explosive microcosm of the greater Middle East region blows up, it will destroy any US attempt at a fresh start in the region.