Gaza: A Deal, A Hit

As it is, the deal has infuriated Arab leaders, who denounce it as an Israeli land grab. Egypt's President Hosni Mubarak, who had met with Bush only days before, told Powell that the U.S. had prejudiced the outcome of Arab-Israeli negotiations. "It's a disaster," an Arab diplomat told TIME. "It came as a huge surprise." Hamas leader Khaled Meshaal says it proves that "resistance is the only way."

The Rantisi strike is certain to intensify Palestinian fury against Israel and the U.S. "The assassination was the outcome of the Bush-Sharon meeting," said Abdullah Shami, a leader of Islamic Jihad. A Palestinian official in Gaza said protesters were calling for retaliation against "American interests." U.S. officials take a different view. They insist Arab leaders had prior warning of the pact. "The rest of the [peace] process is going nowhere fast," notes a senior State Department official. "This is something real--moving people, tanks and troops." Perhaps, but just days after the deal was made came the bloody reminder that removing violence from Gaza is entirely another matter.

--By Massimo Calabresi, Jamil Hamad, Scott MacLeod and Matt Rees