The latest round of fighting between Israel and Hamas highlighted the Islamist organization’s international and regional isolation.Although Hamas and the radical Islamist ISIS (Islamic State in Iraq and Syria) are rivals, both are versions of militant anti- Western Islam. The recent gains by ISIS in Iraq and Syria sent shock waves across Europe and the US. Being placed in much the same threatening basket significantly hurt Hamas’s already troubled standing in Western opinion.The fact that Israel seemed to intensify Operation Protective Edge reluctantly, and accepted cease-fires along the way, won it further points at Hamas’s expense.More importantly, Hamas has never been as isolated in the region as it is today. Like many in the West, Egypt defines Hamas as a terrorist organization, an offshoot of the Muslim Brotherhood outlawed by the new secular regime in Cairo. With unprecedented derision, Saudi and Egyptian commentators mocked Hamas’s military achievements – firing hundreds of rockets to little effect besides provoking devastating Israeli responses and causing acute Palestinian suffering.On the Arab street, anti-Israel demonstrations, massive and heated during previous military campaigns, were sporadic and relatively minor. Moreover, the leaders of the moderate Sunni axis – Egypt, Saudi Arabia, Jordan and most of the Gulf States – tacitly sided with Israel.The regional exceptions were Turkey, Qatar and Iran – which as part of a struggle for hegemony, backed Hamas and tried to undermine Cairo’s attempts to negotiate a ceasefire they believed might be favorable to Israel.The overt international and tacit regional support gave Israel an unfamiliar military and diplomatic tailwind. Among decision-makers and politicians in Jerusalem, there were three main approaches on how best to exploit it: • Foreign Minister Avigdor Liberman led right-wing calls to use the diplomatic window of opportunity to reconquer Gaza and stay for as long as it took to destroy Hamas’s terrorist infrastructure. Others on the Right, like Strategic Affairs Minister Yuval Steinitz, added an ambitious diplomatic component – toppling the Hamas government to make way for the return of PA control of Gaza in the context of a far-reaching regional settlement, which he declined to spell out.• Prime Minister Benjamin Netanyahu and Defense Minister Moshe Ya’alon hoped to use the favorable diplomatic climate to achieve a satisfactory cease-fire agreement without having to commit ground forces.When that strategy failed, they were forced to send in troops with four major goals – to destroy terrorist tunnels and munitions, destroy rocket-launching sites, engage Hamas fighters and force a cease-fire.That, however, proved elusive. Egypt, the main mediator, wanted to see Hamas significantly weakened and was happy to sit back and watch Israel grinding away at no cost to Cairo. For their part, Hamas leaders wanted cease-fire terms that clearly provided for a better life for Gazans – otherwise they risked regime-threatening public ire driven by questions over what all the suffering had been about. This led to a catch-22 situation: Egypt insisting that the parties first agree to a cease-fire and then discuss its terms; Hamas demanding terms first, for example, prior guarantees that restrictions on Gaza’s access to the outside world be lifted, and only then ending hostilities.For Israel, the stalemate dictated a rolling ground operation, with the IDF continually upping the ante to put more pressure on Hamas to accept a cease-fire – first destroying its extensive network of cross-border tunnels, then going for Hamas operatives and rocketlaunchers deeper in Gaza, taking more territory all the time and threatening to reach and target Hamas leaders.• Voices on the center-left sounded more ambitious and upbeat scenarios. Opposition and Labor leader Yitzhak Herzog suggested that, given the favorable diplomatic climate, the Gaza operation could be used as a launching pad for a major transformation of the Israeli-Palestinian conflict and Israel’s place in the region. Herzog argued that in the aftermath of the fighting, Israel should strive to build a grand regional détente including the Palestinians in both Gaza and the West Bank, Egypt, Jordan and the rest of the moderate Sunni world.The conduct and results of the military campaign will send a strong message to both Israel’s foes and its potential friends in the region. Deterrence is the name of the game.A successful Israeli projection of power will deter not only Hamas, but other stronger players, like Hezbollah in Lebanon. For its overall national security, a strong Israeli performance is imperative. In this context, the outstanding success of the Iron Dome rocket interception system goes well beyond the Gaza theater. The development of Iron Dome was accelerated after the Second Lebanon War in 2006 when a defenseless Israeli home front took around 4,000 rocket and missile hits in 34 days of fighting. Another lesson from that war was to enter Gaza this time with huge ground forces.Initially, they discovered and destroyed well over a dozen cross-border terrorist tunnels starting from hidden entrances in homes on the Gaza side of the border and coming out in Israeli territory, putting border towns and villages at risk. But Hamas uses tunnels for defensive purposes, too.When the search for tunnel openings and rocket-launching pads took the Golani Brigade into the Shejaia neighborhood, they discovered to their cost the full complexity of Hamas’s underground defense system.According to the IDF, this comprises a string of parallel tunneled arcs starting from outlying districts protecting Gaza City. Hamas fighters are underground, its commanders and political leaders further below, with civilians held hostage on top as human shields.In Shejaia, IDF forces ambushed by fighters emerging from tunnels took heavy casualties.Thirteen Golani soldiers were killed. To blunt the Hamas attack and cover forces removing wounded under heavy fire, the IDF launched intense artillery barrages. In the fighting and shelling at least 65 Palestinians were killed, many of them civilians. The Palestinians called it a massacre and the mounting toll accelerated cease-fire efforts. Still, fighting continued across the entire Gaza Strip, and IDF forces engaged and killed dozens of Hamas fighters.Unlike previous rounds, the current fighting could lead to major regional change. Much will depend on Netanyahu’s leadership and his vision of the endgame. He is committed to ending the rocket and tunnel threats by military or diplomatic means.But he seems certain to reject right-wing calls for a long-term reoccupation of Gaza to destroy its terrorist infrastructure. Not only would the occupying soldiers become terrorist targets, but Israel would again be saddled with the need to provide civilian services to a population of around 1.8 million.Moreover, the international response, despite the current favorable climate, would almost certainly be overwhelmingly critical.A more feasible military option would be to turn the current campaign into something along the lines of the month-long Operation Defensive Shield, during which the IDF retook West Bank cities in 2002, changing the course of the Second Intifada. But, critics say, a month would not be enough time to destroy Hamas’s military capabilities. The IDF could be sucked into a much longer stay, or, if it withdrew early, Hamas would simply rebuild.Whatever military action Israel takes, it is clear that the crisis will have to be resolved by diplomatic means of one kind or another.Indeed, the big aftermath strategy question is whether to aim for PA rule in Gaza or to be content to leave Hamas in charge. Netanyahu is getting advice from inside and outside the government to be proactive in helping to fashion a cease-fire under which Egypt opens the Rafah border crossing point, with PA officials manning it as a step towards the PA gradually taking over the governing of Gaza with strong Egyptian and American backing. The pay-off for Egypt would be greater control over potential jihadist threats from Gaza and Sinai, and, in regional terms, a precious victory over the radicals.Some analysts argue that Hamas might not be averse to this – that the late April reconciliation with Palestinian Authority President Mahmoud Abbas’s Fatah signals Hamas’s willingness to be relieved of political responsibility for Gaza’s impoverished society.Part of a new deal for Gaza would be to open it to the world, creating jobs and new trade possibilities. Transport Minister Yisrael Katz, for example, is proposing that Israel allow Gazans to build a port and an airport. He says he has a detailed blueprint for the construction of an artificial island off the Gaza coast, which would contain both port and airport, with a degree of Israeli or international supervision to prevent their being used to smuggle weapons. According to Katz’s plan, Israel would renounce all political and economic responsibility for Gaza – and leave the supply of electricity, fuel and humanitarian aid to Egypt and the international community until eventual Gazan self-sufficiency.The more optimistic players on the centerleft believe moves in this direction could pave the way for a substantial agreement with the Palestinians and the moderate Sunni states. But will it really be possible to turn Gaza over to the PA as this plan entails? And will Netanyahu be prepared to go along with major peace moves? For many Israelis, the idea of replacing Hamas and making major peace moves seems far-fetched. A more minimalistic scenario – probably more to Netanyahu’s liking – sees Hamas, after a severe beating, retaining its leadership role in Gaza. Indeed, some argue that a weakened and chastened Hamas – too daunted to threaten Israel but still strong enough to rule Gaza with an iron fist – is the best hope for long-term quiet.The goal in this scenario is to weaken Hamas enough to deter it from further attacks against Israel, but not to the extent that it loses control over what happens in Gaza. Getting the balance right is tricky but imperative. Otherwise, the argument goes, Gaza could splinter into numerous extreme jihadi factions leading to domestic chaos and continued sporadic rocket attacks on Israel with no one to talk to about stopping them.The Hamas-retaining-power approach has three main steps: First, Israel’s retaliation in Operation Protective Edge must be powerful enough to restore Israeli deterrence; second, as much as possible of Hamas’s military capabilities, its rocket stores, rocket manufacturing workshops and tunnels must be destroyed in the current IDF operation; third, Israel must aim to get the international community to accept its demands for effective demilitarization of Gaza. In other words, collection and destruction of Hamas and Islamic Jihad rockets, much the same way as the international community destroyed Syria’s chemical weapons’ capabilities.In presenting this demand, Netanyahu will almost certainly point to the 2003 international roadmap for peace, which provides, inter alia, for the demilitarization of Gaza and the West Bank and the collection of all unauthorized weapons.Although imperative in the event of Hamas continuing to run Gaza, these aims in no way contradict a diplomatic solution that has Abbas eventually taking control of Gaza.Indeed, effective demilitarization would be far more likely if he does.Depending on how it pans out, the crisis could have major political reverberations in Israel too. Netanyahu’s initially circumspect conduct, which won kudos from the international community and the Israeli center-left, laid him open to savage criticism from his political opponents on the Right, including his own Likud party. With anti- Netanyahu feeling in the Likud running high, former deputy defense minister Danny Danon took a string of politically motivated potshots at the prime minister, forcing Netanyahu to fire him. That seemed to silence other wouldbe Likud faction critics.Far more significant though was Foreign Minister Avigdor Liberman’s brazen attempt to use the crisis to undermine Netanyahu and set himself up as a potential successor.Hours after the cabinet agreed to a ceasefire on July 15 (which never took hold), Liberman called a media conference to slam Netanyahu (without mentioning him by name) as weak and vacillating. Such conduct by a sitting foreign minister in wartime is unprecedented.When the dust settles Netanyahu will have to decide whether to initiate changes in the make-up of the governing coalition – for example, firing Liberman, possibly losing Naftali Bennett’s right-wing Bayit Yehudi party in the process, and bringing in Labor, Kadima and the Haredi parties instead.Much will depend on the outcome of the military action – whether or not it strengthens Netanyahu domestically – and the subsequent diplomatic goals he defines.