Israel's invasion of Rafah stirred Palestinian memories of the past and deepened all their fears for the future. Graham Usher reports from Gaza A woman pulls a wooden cart laden with bedding, kitchen utensils and water tanks through a jagged landscape of destroyed homes and smouldering rubbish. It could be a still from the 1948 war which saw the new Jewish state born and most of the Palestinians' ancestral homeland lost -- events whose 56th anniversary was commemorated last weekend in rallies and marches throughout Israel, the occupied territories and the wider Palestinian diasporas. It is Rafah refugee camp, Sunday 16 May, one day ahead of Israel's most massive military incursion into Gaza since it was occupied in the 1967 war. "We knew it would come," said one local, as he steered refugees living on Rafah's border with Egypt to new tent cities pitched by the UN and Gaza Islamic charity organisations. There are now 2,000 Palestinians squatting in these and in schools set up as "emergency absorption centres". They join 12,000 Palestinians in Rafah displaced from their homes as a result of Israel's earlier, tidal-like invasions into the town. Rafah is home to 140,000 Palestinians, 90,000 of them refugees. Israel's latest offensive was triggered by a ferocious round of fighting between the Israeli army and Palestinian guerrillas in Gaza last week. Thirty-one Palestinians and 13 Israeli soldiers were killed. On Monday Israeli tanks and soldiers -- flanked by buzzing helicopters -- invaded the city from all sides, the initial targets being Rafah refugee camp and the Tel Al-Sultan neighbourhood. Over the next 24 hours, 21 Palestinians were killed and over 40 wounded, most of them civilians, as soldiers went house to house, aiming to crush an armed Palestinian resistance that so far has refused to be cowed. There were no Israeli casualties. Israeli army officials say the aims of operation "Rainbow in the Cloud" are twofold. First, to unearth and destroy a honeycomb of tunnels Palestinian militias have long used to smuggle arms under the Egyptian border and into Gaza. Second, to flush out local Palestinian leaders and fighters that have made the border region the deadliest front-line in the three and a half year Intifada. Earlier plans to clear "hundreds of houses" (in the words of Israeli army Chief Moshe Yaalon) appear to have been shelved under pressure from the Americans, the UN and the European Union; at least for now. But few Palestinians doubt that their destruction will come, as Israeli Prime Minister Ariel Sharon strives to create a "new operational reality" in Gaza ahead of his stated intention to "disengage" from its interior while maintaining a vice-like grip on its borders. Few have any desire to return to houses that once lined the border zones, especially as Sharon has made it clear that his army will re-invade Gaza whenever it sees the need to do so, whether before or after "disengagement". The problem for Palestinians in Rafah, like their compatriots in the occupied territories and elsewhere, is that there are less and less parts of "Palestine" to return to. Rafah is now hemmed in on all sides: to the south by the closed Egyptian border, to the east by the ocean, to the west by Jewish settlements and to the north by a cordon of Israeli tanks, soldiers and helicopters on hand to ensnare escaping "fugitives" or any other Palestinian. Sharon says the conquest of Rafah is needed to prevent "Palestinian terrorists attaining the [military] capabilities to which they aspire," so that they can "threaten the heart of the country even after the disengagement from Gaza". In the longer term he appears to be seeking a greater role for Egypt and other international forces to police Gaza so that a "moderate" Palestinian leadership can emerge ahead of any Israeli pullback. There is precious little sign of that leadership in Rafah. Reality is rather local militias laying explosives and readying arms for a battle they expect to be as protracted and as bloody as were the ones in Nablus and Jenin refugee camp in April 2002. The invasion has imposed "a new discipline on them", says a local. The mood was summed up in a joint leaflet distributed by Hamas, Islamic Jihad and the Al-Aqsa Martyrs Brigades throughout Gaza on Monday. "We either fight united and achieve victory or fight as individuals and lose," it said. Squeezed between army and militias, the Palestinian Authority (PA) leadership pulls like a tug in a storm. In meetings on Sunday and Monday with US Secretary of State Colin Powell and National Security Advisor Condoleezza Rice, PA Prime Minister Ahmed Qurei prevailed on them to "act" against the Israeli invasion. Under American pressure, he also reluctantly agreed to Sharon's disengagement as "the first step in Israel's withdrawal from all occupied Palestinian territory", and to reform the PA's police forces to smooth the withdrawal. But his insistent message was for the Americans to back his plan for "comprehensive cease-fire" in which the Palestinian factions will hold their fire and Israel will desist from massive military attacks like the one now happening in Rafah. It is doubtful he will receive much support, other than perhaps some pressure on Israel to refrain from the mass destruction of Palestinian homes. America -- like Israel -- has long predicated its re-engagement in the conflict on the PA removing Yasser Arafat from power and reforming its security forces. It is not interested in any cease-fire. As for Sharon he is interested only in victory, so that his army is seen not to leave Gaza the way it left Lebanon.