Although the current Gaza crisis is in many ways reminiscent of the last flare-up in December 2008–January 2009, there are important differences this time around. Hamas’s terrorist reach now includes Israel’s heartland cities of Jerusalem and Tel Aviv due to long-range Iranian rockets. However, Israel’s new Iron Dome missile defense system has mitigated this threat. The “Arab Spring” uprisings have also significantly altered the geopolitical landscape of the Middle East by resetting Egypt’s foreign policy, which may have emboldened Hamas to trigger the current crisis.

To broker a stable cease-fire that doesn’t harm Israel, the United States should work closely with Egypt, which has strong influence with Hamas and seeks to prevent the fighting from threatening its economy. This will be a litmus test for Egypt’s new Islamist leadership. The U.S. must be clear about what is required to build an acceptable and sustainable cease-fire. Washington must leverage its aid to Cairo to ensure an outcome that halts rocket attacks, protects civilians on both sides of the border, limits Hamas’s ability to rearm, reduces Iranian influence, and enhances regional security.

Egypt’s Diplomatic Tightrope Act

Hamas seeks to galvanize Arab and Muslim public opinion, delegitimize Israel, outflank the rival Palestinian Authority, and gain greater support from Arab states to tilt the balance against Israel.

Hamas recognizes that it cannot win a military victory against Israel but seeks to extract a political victory by reaping the propaganda benefits of playing the victimization card in the face of Israeli military retaliation for its indiscriminate rocket attacks. Hamas knows that Israel is more concerned than it is about avoiding the deaths of Palestinian civilians, so it continues to use Gazans as human shields while launching rockets at Israeli civilians.

Although Egypt’s new Muslim Brotherhood–dominated government shares an ideological affinity with Hamas, the Palestinian offshoot of the Muslim Brotherhood, Cairo’s Islamist leaders have strong reasons to facilitate a halt in the fighting. Doing so will facilitate the continued flow of Western aid they need to address Egypt’s rapidly deteriorating economic situation and stay in power.

Egypt’s state-dominated economy is on the verge of bankruptcy, in part due to the adverse impact of the Arab uprising on tourism and foreign investment, and soon will be unable to pay for its massive food imports. Cairo is increasingly dependent on foreign aid to ease its economic problems and is counting on annual aid from the U.S. ($450 million), the International Monetary Fund ($4.3 billion), and the European Union ($6.3 billion).

Egyptian President Mohamed Morsi, therefore, has been forced to temper his Islamist ideological preferences with consideration of Egypt’s national interests and his own political interest in retaining power. He has tried to have his cake and eat it too by cautiously trying to broker a cease-fire behind the scenes while publicly lambasting Israel. Like the Mubarak regime in 2009, President Morsi withdrew the Egyptian ambassador to Israel but broke new ground by dispatching Prime Minister Hisham Kandil to Gaza to express Egypt’s solidarity with the Palestinians on the second day of the fighting.

Egyptian intelligence officials have facilitated indirect negotiations in Cairo between the Israeli government and Hamas that apparently have made some progress, although the two sides reportedly remain far apart. On Tuesday, President Morsi nevertheless promised that Israel’s “aggression” will end and that a “cease-fire” would soon produce “positive results”—shortly before another Palestinian rocket exploded near Jerusalem. Israel, understandably, has refused to halt its air strikes until Hamas ends its terrorist attacks.

Criteria for a Successful Resolution of the Gaza Crisis

Secretary of State Hillary Clinton has broken off her trip to Asia and flown to Israel to join efforts to broker an agreement to halt the fighting. The U.S.’s goal should be to create conditions that shore up the long-term stability of the region, minimize terrorism, enhance the security of Israeli and Palestinian civilians, and reduce the risk of another Arab–Israeli war.

Rushing to impose a one-sided cease-fire that restrains Israel without imposing meaningful constraints on Hamas rocket attacks would only reward Hamas for its terrorist acts and lead it to renew the conflict once it has rearmed.

To attain a stable and sustainable cease-fire, Secretary of State Clinton should:

• Insist on an immediate and lasting halt to Palestinian rocket terrorism. Hamas must not only halt its own attacks, but also commit to halting rocket attacks by Palestinian Islamic Jihad and other ultra-extremist terrorist groups.
• Call on Egypt to guarantee Hamas compliance. Because Hamas cannot be trusted to fulfill its promises, Israel should sign an agreement with Egypt that pledges an end of Israeli air strikes as long as Gaza-based terrorism is halted. This would allow Cairo to claim credit for protecting Gazans and ensure that Egypt uses its leverage over Hamas to minimize the chances of another spasm of violence.
• Stop the smuggling of Iranian rockets into Gaza. Any cease-fire arrangements will be inherently unstable as long as Iranian-made Fajr-5 long-range rockets capable of reaching the outskirts of Tel Aviv and Jerusalem continue to be smuggled into Gaza. Egypt would have to close the tunnels under the border with Gaza, but could compensate by keeping open the Rafah border crossing, which would allow it to take credit for easing the humanitarian plight of Gazans. Egypt would also benefit from reducing Iranian influence over Hamas and other Palestinian groups that dilutes its own leverage in Gaza.
• Help Egypt to restore law and order to the Sinai peninsula. Radicalized Bedouin and ultra-extremist Islamist militants have colluded with Palestinian militants to create a springboard for terrorist attacks against Israel and Egyptian security forces in Northern Sinai. Washington should offer help in the form of intelligence-sharing and drone surveillance to enable Egypt to close down this emerging terrorist safe haven. Otherwise, Palestinian terrorists are likely to expand their operations out of Gaza into ungoverned Egyptian territory.

Work with Egypt to Restrain Hamas

The U.S. and Egypt share common interests in ending the carnage in Gaza: protecting civilians and halting the spread of ultra-extremist militants who have killed Egyptians, Americans, Palestinians, and Israelis in recent months. Given America’s limited leverage over Hamas, Washington must lean on Egypt to use its leverage over Hamas.

Secretary of State Clinton should incentivize Cairo to rein in Hamas by making it clear that American aid and support for IMF loans to Egypt will be calibrated according to the degree to which the Morsi government exercises a moderating influence on Palestinian militants. President Morsi must be convinced that future Palestinian terrorism threatens not only Israeli civilians, but also Egypt’s national interests and his own political future.

—James Phillips is Senior Research Fellow for Middle Eastern Affairs in the Douglas and Sarah Allison Center for Foreign Policy Studies, a division of the Kathryn and Shelby Cullom Davis Institute for International Studies, at The Heritage Foundation.