The United States expressed concern Wednesday that renewed factional violence between Palestinians would set back the peace process. "This is something that does nothing to help the cause of the Palestinian people. Certainly it doesn't bring them any closer to achieving a Palestinian state that people want and desire," US State Department Deputy Spokesman Tom Casey said. Another State Department official told The Jerusalem Post that the recent Hamas attack on Fatah guards at the Karni crossing "threatens to undermine the efforts of the United States and the international community to improve the economic and humanitarian conditions for the Palestinian people in Gaza." Observers said that the violence between Hamas and Fatah hurts American efforts at mediation between Israelis and Palestinians. Earlier this month, US Secretary of State Condoleezza Rice called off a planned trip to the region, as the Israeli government is also in turmoil following the Winograd Committee's criticism of Israeli leadership during the Lebanon War. A source, though, said for now America's current diplomatic efforts - specifically, a proposed series of steps for Israelis and Palestinians to take to improve the situation on the ground as well as a non-lethal training program for the presidential guard of Fatah head and Palestinian Authority Chairman Mahmoud Abbas - are still on track. But a State Department official said: "With respect to planned assistance for the Presidential Guard and the Karni crossing, we remain in the early stages of contracting and it will be some weeks before activities on the ground are poised to begin. As such, it remains unclear what impact, if any, the current violence might have on our programs." He also said that "Lieutenant General Keith Dayton, the US security coordinator, as well as our ambassador in Tel Aviv and consul-general in Jerusalem, are in regular contact with senior Israeli and Palestinian officials." Dayton is overseeing the arrangement for the training program. Some see new urgency in the efforts to help Abbas in his conflict with Hamas. If Fatah comes out on top from this round of fighting, that could help Abbas assert more control. Right now, Abbas sits atop an uneasy unity government in which Hamas controls most of the ministries and the Palestinian Legislative Council. The factional hostilities threaten that coalition. "It obviously complicates US efforts and it brings into question the future of the unity government," said David Makovsky, director of The Washington Institute's Project on the Middle East Peace Process. "There's a kind of wait-and-see attitude in Washington right now" concerning the fallout from the Palestinian and Israeli political battles, he said. He added that how the details of actual battles between Hamas and Fatah play out could have a significant impact on who yields power. On Wednesday, one senior Western official was at pains to paint the Hamas attack on Fatah near the Karni crossing as a victory for Fatah and Abbas. Some eight presidential guard members were killed in the Hamas attack by the crossing between the Gaza Strip and Israel. Though some accounts described the Fatah guards as fighting poorly, he stressed that young, newly trained and poorly armed Fatah forces were able to ward off many more Hamas men who were equipped with trucks, rocket propelled grenades, and other serious equipment. "Out-gunned, out-equipped â€¦ they held [Hamas] off, and it's a tribute to President Abbas. They did a remarkable job," the official said. Regardless of the street battles, one expert said that the Islamic extremist group had already lost when it came to governance. "Hamas has failed on every front," said Zaki Chehab, author of Inside Hamas, and the London bureau chief of Al Hayat, charging it had made the same types of patronage appointments and other governance mistakes that earned Palestinian ire at Fatah and brought Hamas into power last year. Former PA chief of protocol, Khaled al-Yazji said that the entire Palestinian Authority has already disappointed its people and essentially ceased to function. "The Authority doesn't exist any more. It is dissolved," he said. "There are no services, nothing at all, no salaries." The Associated Press contributed to this report.