After the Hamas takeover of Gaza in June, Israel sought to bolster Palestinian Authority Chairman Mahmoud Abbas's status. While Jerusalem was skeptical regarding his capacity to become a real partner, it understood that only a "political" horizon might prevent the fall of the West Bank to Hamas. The renewal of negotiations between Abbas and Prime Minister Ehud Olmert is aimed at arriving at an agreement of principles on all outstanding issues by November 15 - the date scheduled for the US-sponsored international conference on the Middle East. Despite the goodwill of both parties, there is a concern that the differences are too wide to be bridged. Abbas demands that the sides reach a framework agreement with a timeline for implementation ahead of the conference, thereby raising the bar for an agreement to be reached. Despite the obvious obstacles ahead, Israel does not seem to be preparing for the possibility that the negotiations might fail. Some may dismiss the importance of a possible collapse of the talks, seeing it as just another step in the long line of political stalemate between Israel and the Palestinians. However, failure of negotiations with Abbas and PA Prime Minister Salaam Fayad, the best partners the Palestinians can offer Israel, could severely damage Israel's geostrategic position. A collapse of the current political process would mean a knockout for the Palestinian moderate camp and the narrative of historic compromise. This might further accelerate the trend of Palestinian revulsion toward the two-state solution and encourage more and more Palestinians to call for the dissolution of the PA, in order to perpetuate the Israeli occupation and promote the establishment of a binational state in all of Mandatory Palestine. Moreover, some within the international community are already claiming that the small size of the territory, demographic trends, the intertwined nature of Jewish and Palestinian communities, and the issue of natural resources (such as water) do not permit the establishment of a viable Palestinian state alongside the State of Israel. These arguments come against the backdrop of increasing calls from left-wing elements in the global community to adopt the one-state solution, based on the argument that it presents the only solution that is moral, just and achievable. A collapse of the political process might bring even leading actors among the international community to question the viability of the two-state solution and the principle of separation between Israel and the Palestinians. The conclusion is that the failure of negotiations could not only lead to a Hamas takeover of the West Bank, but deal a severe blow to the principle of the two-state solution. The current IDF presence in Palestinian cities in the West Bank, aimed at thwarting terrorism and preventing a Hamas takeover, may turn into a quagmire if negotiations fail and the PA collapses. Under these circumstances, it is obvious that Israel should prepare an exit strategy in case it decides the negotiations are doomed to collapse. The essence of such a strategy is to "blur the failure." However, the real key for dealing with this dilemma is to bolster the PA's political status and delivery capability so that it can survive a collapse of the political process. Therefore, parallel to negotiations, Israel should promote the strategy of granting greater powers and responsibilities to the PA in the international arena. Abbas's rejection of the establishment of a Palestinian state with provisional borders prior to an agreement of principles does not necessarily indicate he would oppose actions aimed at granting attributes of statehood to the PA. The rule of thumb for Israel should be to offer gestures in the "spirit of negotiations" that upgrade de facto the status of the PA and minimally compromise Israeli security interests. Such actions may promote the logic of a two-state solution. Eran Shayshon is an analyst team leader at the Reut Institute for Policy Planning.