Another Try At A Palestinian Government

Ignoring Hamas' vehement protests, Palestinian President Mahmoud Abbas on Sunday swore in a new government without his political rivals, outlawed Hamas militias and said he'll push hard for a restoration of foreign aid to the Palestinians after a punishing 15-month boycott.

Meanwhile, Israel intensified the blockade of Hamas-ruled Gaza.

With its armor on the edge of the Gaza Strip, Israel warned it's ready to move in if threatened, reports CBS News foreign correspondent Richard Roth. But right now it's just applying pressure…at Gaza's pumps, for instance.

They'll soon run dry. Israel is cutting off fuel supplies to Gaza for cars and cooking.

A run on bread and other basic supplies intensified too, driving the price of a box of Marlboro cigarettes, a reliable gauge of shortages, up by a third.

That's also part of America's new Palestinian policy: to squeeze the radical Islamic group, adds Roth.

Hamas seized control of Gaza last week after five days of intense fighting against forces loyal to Abbas' Fatah. The takeover prompted Abbas to dissolve a Fatah-Hamas coalition government and appoint a new Cabinet excluding the Islamic group.

The hurried swearing-in ceremony of the new Cabinet left the Palestinians effectively with two governments: the Hamas leadership headed by deposed Prime Minister Ismail Haniyeh in Gaza and the new Cabinet led by the Western-backed economist Salam Fayyad in the West Bank.

"The first priority of our government is security and the security situation," Fayyad told reporters. "The mission will be difficult and hard, but not impossible."

Fayyad, an independent, will retain his post as finance minister and also serve as foreign minister in the emergency government. The small Cabinet is dominated by independents, including human rights activists and business people.

In his speech, Fayyad stressed that the government represented Palestinians in the West Bank and Gaza. The Palestinians claim both areas for a state, but the internal strife has endangered that goal.

Addressing the Palestinians in Gaza, he said: "You are in our hearts, and the top of our agenda. The dark images, the shameful things that are alien to our traditions ... are not going to stop us." It is "time to work together for Palestine," he said.

Abbas cleared the way for the Cabinet to take power by issuing a decree that annulled a law requiring the government to be approved by parliament, which is dominated by Hamas. He also issued a decree outlawing Hamas' militias "due to their military coup against the Palestinian legitimacy and its institutions."

However, Abbas' attempts to assert control only deepened the Palestinian divisions. In Gaza, Haniyeh called the new government illegal and insisted he remains in power. "The national unity government asserts here that we are fulfilling our duty according to our law," he said.

In the showdown, much of the international community, including the United States, the European Union and moderate Arab states, is backing Abbas. Declarations of support were likely to be followed soon by a resumption of foreign aid to the Palestinian Authority, which was cut when Hamas took office last year. The sanctions have caused widespread suffering in the Palestinian areas.

"The first goal we are working to achieve is to end the siege and have a unique relationship with all the nations," Abbas said after swearing in the new Cabinet.

Both Israel and the United States already have said they will work to bolster Abbas, while isolating Hamas. The U.S., EU and Israel consider Hamas, which has killed hundreds of Israelis in suicide bombings, a terrorist group.

At the outset of a trip to the United States, Israeli Prime Minister Ehud Olmert said the new Palestinian government would create a "new opportunity" for reviving peace talks. "We will act with all our might not to miss this opportunity," Olmert said. The situation in Gaza is expected to dominate Olmert's meeting at the White House on Tuesday.

In an interview Sunday, the top U.S. diplomat in Jerusalem said that Washington will fully support Abbas' new government and resume aid. But he acknowledged the moderate president has lost his influence over Gaza, clouding the prospects for a resumption of peace making.

"We're not going to lose sight of the need to begin a process between Israel and the Palestinians to resolve the fundamental problems, but before we can do that I think we need to get the (Palestinian) house in order first," Consul General Jacob Walles told the Associated Press.

The isolation of Gaza has raised fears of a humanitarian crisis, because its borders have been closed by Israel and Egypt.

In Gaza, panicked residents stocked up, fearing growing shortages of food, fuel and other staples.

With cigarette prices soaring, sandwich seller Mohammed Sheik said he bought half a pack of the cheap locally made "Jamal" brand. He tried to pace himself because it might be his last.

The Israeli fuel company Dor Alon said Sunday it was cutting of fuel supplies immediately to Gaza's gas stations. The company is the sole provider of gasoline to Gaza.

Dor Alon will continue to ship fuel to Gaza's electricity power plant, the company said, but about 30 percent of Gazans have been cut off from the electric grid because of infrastructure damage caused by the fighting, and they rely upon generators for power.

Shipments into the territory dried up during last week's fighting, and workers at Gaza's only fuel warehouse said reserves had already run out. Palestinian health officials warned the fuel shortage could immobilize ambulances and prevent food and medicine deliveries.

"The results will be Gaza in full darkness, with no cars," said Asef Hamdi, a worker at a Gaza gas station. Palestinian official Saeb Erekat appealed to Israel and the international community not to cut off supplies to Gaza. "Residents must not be punished for the bloody coup staged by Hamas," he said.

Israeli Foreign Ministry spokesman Mark Regev said Israel was aware of the humanitarian dangers facing the Gaza Strip. "No one, including Israel, wants to accentuate hardship that already exists in Gaza as a result of the internal conflict," he said. But he said Israel has not yet figured out a way to deal with the Hamas rulers of Gaza.

Meanwhile, about 300 Gazans remained trapped at the Erez border crossing with Israel, hoping to escape Hamas rule, Israeli officials said. Nervous pro-Fatah security officials at the border ordered cameramen not to film their faces, as children slept on their mother's laps and on the floor.

Israel said it was only letting the staff of international organizations, people with special permission and humanitarian cases to cross. The restrictions have created a chaotic scene at the terminal.

"We aren't allowed to let them in," said military spokesman Shlomo Dror.

Israeli Channel 2 TV showed scenes of women and children stranded at the terminal. "We want to enter Israel. If they don't, Hamas will slaughter us," an old woman screamed hysterically.

In southern Gaza, meanwhile, 15 members of Hamas' militia guarded the empty Rafah border crossing into Egypt. Officials said about 100 people remained stranded on the Egyptian side of the border, waiting to return to Gaza. Most of the people are Fatah men who fled during the infighting, and Egypt has refused to grant them refuge.

More than 50 people have returned to Gaza in the past two days after receiving promises of amnesty from Hamas.