I'm not sure that Hamas in power is any worse than Fatah. Fatah sorta kinda said for international audiences that maybe Israel was entitled to exist, but that's not the message it was conveying for home consumption, and that was certainly not consistent with the avowed aims and actions of its own paramilitary terrorist arms. Even assuming good faith by the Fatah political leadership -- which assumption I don't accept -- they did not have the political will or credibility with their constituents to bring meaningful peace even if they'd wanted to.

Nonetheless, although the peace process was a joke, the US and others maintained it wasn't and continued to aid Fatah and treat it like it was a serious entity. I wish Bush had been more aggressive and called a spade a spade, but I can't blame him for publicly holding out the possibility that the peace process remained viable. Had he said anything else, the entire world would have started jumping up and down and screaming that yet again "Bushitler" was showing his true colors as a warmongering fascist lacky of Israel who hated Arabs and Islam, etc. No doubt, your friends John Kerry, Hillary, et al., would have been leading the chorus.

Which brings us to Hamas, a terrorist organization that has now reaffirmed post-election that it is committed to the destruction of Israel. At least the cards are on the table. Having elected Hamas, the Palestinian electorate will now be held accountable for their decision. Refusing recognition, cutting off the flow of international aid, and Israeli completion of the Wall are the first steps. Then, as the article I linked to above shows, Israel has powerful weapons available in case of provocation, both peaceful (cutting off power and water, etc.) and military.

In short, it seems to me that Israel is no worse off or militarily vulnerable than it was before, and perhaps the election has brought a moral clarity and accountability that will, in the long run, eventually bring the Palestinian people to the painful realization that they need real peace.