The world breathed a collective sigh when Marwan Barghouti announced he would not be standing for Palestinian president. But it is a setback for Palestinian democracy, writes Graham Usher in Jerusalem Ever since Yasser Arafat's death there has been a concerted effort to recast the Israel- Palestinian conflict in the mould of a "new beginning". This is not altogether wishful thinking. There is a renewed international and regional engagement in the conflict, with Egypt taking the lead on the Arab side. There is in effect a new Israeli government, led by an old prime minister, but armed for the first time with a mandate to remove Jewish settlements from occupied Palestinian land. Finally, Palestinians are poised to participate in a genuinely comprehensive suffrage, with a batch of municipal elections later this month, a presidential poll in January and, perhaps, parliamentary elections in May. But these new realities are being determined by old dynamics and even older ambitions. For example, Israeli defence minister, Shaul Mofaz, said this week that the aim of Ariel Sharon's disengagement is not a comprehensive peace settlement ("since this is unimaginable in the present circumstances"). It is rather another "interim" agreement, under which, presumably, Israel can more easily "separate" itself from the burden of Gaza while consolidating its hold on the West Bank. On the Palestinian side also the old refuses to relax its grip on the new, with two events particularly illustrating the case. One was Marwan Barghouti's now irreversible decision not to contest the Palestinian presidency. The other was Hamas and Fatah's return to spectacular armed resistance in Gaza through an attack on an army outpost near the Egyptian border that left five soldiers dead and six wounded. "The most lethal attack of its kind since the start of the conflict," wrote one Israeli military analyst. Barghouti's off again candidacy was announced on 12 December. It was never intended to be an "internal challenge" to Fatah's official nominee, Mahmoud Abbas, explained Barghouti's campaign spokesman, Ahmed Ghneim. It was meant only to highlight "the cause of the Palestinian struggle against the Israeli occupation". Perhaps, but it also marked a retreat by Barghouti and the "Intifada" stream he represents within Fatah. From the outset of his candidacy Barghouti was met with wall-to-wall opposition from the Fatah establishment, with its newly appointed leader, Farouk Qaddumi, threatening the elected parliamentarian with expulsion. There was also what can only be described as a global campaign of intimidation. Colin Powell called Barghouti's campaign "problematic"; President Mubarak all but instructed him to stand down "since Palestinians do not need differences at this time"; and Britain hinged a London conference in January in support of the Palestinians on Abbas (and only Abbas) being elected president. The message from all was unequivocal: there would be no diplomatic reward if the Palestinians replace a besieged Palestinian leader with an imprisoned one. Barghouti presumably anticipated this opposition. What he may not have expected was the degree of hostility from those who had been his supporters in Fatah. The grassroots Fatah Higher Committee was split over his candidacy, while Fatah's parliamentary deputies, prisoner leaders and militia commanders opposed it. The prisoners and militiamen's opposition is not hard to fathom. In a clear sign of the times they see Abbas -- and the international and regional legitimacy he commands -- as perhaps the only key to their early release or general amnesty. The others however clearly preferred the conservatism of national unity to the radicalism of democratic choice. "We don't need Marwan to run now," said one reformist Palestinian lawmaker. "We need a unity candidate so that the elections will happen and Israel has no pretext for refusing to negotiate with us." Conservatism prevails also in Hamas, in the form of a rigid adherence to the armed struggle. For a brief moment after Arafat's death there had been signs of a different approach, with Hamas spokesmen calling for a truce and (say sources) a decision to lower the level of resistance, including in Gaza. Then came the decision to boycott the presidential poll. It was followed by renewed mortar attacks on settlements within Gaza and, occasionally, on other targets beyond. Israel responded of course. In three days last week the army killed six Palestinians in Gaza, two of them Hamas men, one a seven-year old girl, hit by tank shrapnel while in her backyard. It also dusted down its penchant for assassination by aerial assault, when helicopters strafed a car carrying Jamal Abu Samhandanah -- self-styled commander of the cross-factional Popular Resistance Committees. He survived. His men promised "an earth shattering response". It came, literally, with the attack on the outpost courtesy of a 500- metre long tunnel and 1.3 tonnes of explosive charge. "The earth opened and swallowed the occupation," said one Fatah man. Does this mean Hamas and the Fatah militias are subverting the Palestinian elections? No, says Hamas spokesman, Mushier Al-Masri. On the contrary, "Hamas is looking to participate in the Palestinian leadership. The operation [on the outpost] is simply retaliation to the occupation, the aggression and the attacks. It's nothing else". Former Palestinian minister, Ziad Abu Amr, agrees. "Hamas is not trying to sabotage the electoral process. The latest operation was planned four months ago, before Arafat's death and Abbas's leadership. It is simply a playing out of the old ground rules. No Palestinian ceasefire has been reached. And Hamas and the other factions will not observe one until there is an agreement between them and the Palestinian Authority and between the PA and Israel". Which is another way of saying that Hamas remains committed to its military strategy of casting Israel's withdrawal from Gaza as a south Lebanon-like flight -- regardless of Arafat's death, Abbas's pleas for "quiet" and the imminence of municipal and parliamentary elections. Perhaps the saddest consequence of Barghouti's decision to withdraw is that the Palestinians will be denied a say on the wisdom of that strategy. As Palestinian political analyst, Khalil Shikaki, points out, Barghouti's candidacy would have turned the presidential election into a referendum on "continuing or ending the four-year Intifada, which he helped to instigate". Instead the Palestinians have a candidate who opposes the Intifada in the hope that negotiations and international support will deliver them a state. The alternatives are not running: they are languishing in an Israeli jail or mining tunnels filled with explosives in Gaza. (see p.8)