When it comes to dealing with the Arab-Israeli problem, the Bush administration is living in another world. It blithely ignores the realities of the Middle East and seems to make policy in a vacuum. It looks clueless.

Take the decision to back Tony Blair as the new envoy of the international “quartet” on the Middle East, with the mission to strengthen the Palestinian Authority. It makes sense for the United States, the United Nations, Europe and Russia to have a high profile representative, but the outgoing British prime minister has the wrong profile. His enthusiastic participation in the invasion of Iraq and unquestioning backing of President Bush's failed Middle East policy have stripped him of credibility with the Arab public. And at least initially, Mr. Blair will not be given authority to mediate between Israel and the Palestinians. So who will listen to him?

Tony Blair leaving 10 Downing Street

The Blair nomination is typical of the administration's muddled thinking on the Middle East, but it is not the worst example when compared to the major blunders it has made in the past few years.

Mr. Bush's grandiose plan to spread democracy throughout the Middle East produced, among other things, the free election last year of a Palestinian government dominated by Hamas, an Islamist party that officially refuses to recognize Israel's right to exist. But Hamas was ready to do business with Israel – indeed it had no other choice if it was to govern effectively – and offered a long-term truce with the Jewish state. Hamas officials even floated the idea that the new Palestinian government could be a bridge between the United States and the broad Islamist movement that has become the main opposition to the undemocratic regimes in the Arab world.

The Bush administration and Israel had an opportunity. If life hands you a lemon, as they say, you can make lemonade. Washington's boldest and best reaction would have been to work with the new Palestinian majority, help it improve the daily lives of the Palestinians and encourage it to become a responsible government. Instead, the White House imposed a financial blockade on the new government, allowed Israel to withhold the tax receipts that were the Palestinian Authority's main source of revenue, and refused to have any relations with the Palestinians' democratically elected representatives. The Bush administration reaction was not only hypocritical. It was counterproductive. It has made the lives of the Palestinians even more miserable, and has given Israel another excuse to delay peace talks.

To make matters worse, the White House has been strengthening and rearming the security forces of the defeated Fatah party. Surely, the last thing the Gaza territory needs is more guns.

The result of these misguided policies has been the violent power grab in Gaza in which the Hamas security forces defeated the Fatah security forces that are still controlled by the president of the Palestinian Authority, Mahmoud Abbas.

Palestinian Authority President Mahmoud Abbas

Abbas, whose Fatah party was voted out of office because of its record of corruption and incompetence, now presides over a truncated Palestinian Authority in the West Bank. U.S. policy now seems to be to strengthen Abbas's hand in the West Bank and let conditions in Gaza deteriorate even further. Abbas is asking Israel to release the tax funds now and to lift the hundreds of roadblocks that bedevil the lives of West Bank Arabs, but the Israelis are dragging their feet on both requests. Instead, the Israeli government seems to be ready to furnish more arms and ammunition to the Fatah security forces in the West Bank so they can outgun the Hamas forces there. Again, more guns are the last thing the Palestinians need.

What will the Bush administration do now? If its track record is any guide, very little beyond the gesture of making Tony Blair the point man for its flawed policy.

One of Israel's most famous foreign ministers, Abba Eban, once said, “The Palestinians never miss a chance to miss a chance.” You could say the same thing about the Bush administration.