Second of five parts
Hamas is considered a terrorist organization by Israel, the U.S. and many other Western nations. But it is also the government in the Gaza Strip. The Islamist militants have controlled Gaza for the past three years after they ousted the rival Fatah movement, which now controls only the West Bank.
Despite Israel's recent military operation in Gaza and a punishing blockade, Hamas seems to be entrenching its rule.
At sunset on a summer day, families sit at tables or bob in the waves at one of the many Hamas-funded beach resorts that have popped up along the Gaza coast this summer. Most people in Gaza cannot leave the enclave, so clubs such as this one -- with an entry fee of about $3 per person -- have become popular escapes.
Ahmed Qaddura, 25, is a manager of one of the beach clubs. It's run by the Islamic Association, a Hamas-linked charity.
"This is a joint venture between the government here and business people. There are two reasons: One is to make a profit, but the other is to ease the difficult life of the people in the Gaza Strip. So it's good for everybody," he says.
The investors have paid a lot of money to get the building materials smuggled in through tunnels that run underneath Gaza's border with Egypt, Qaddura says.
The beach clubs are not the only new Hamas-linked businesses that dot the landscape. A raft of new ventures, including wedding halls and a shopping center, have some calling the Islamist movement "Hamas Inc."
Omar Shaban, a Gaza-based economist who has investigated Hamas' financial dealings, says there is a new group of businesspeople emerging within the organization. He says Hamas has a significant amount of cash and is using it to acquire assets.
"This business group has made a lot of profit out of controlling the economy, and this group is gaining more power every day over the movement," he says.
It's another sign that Hamas is adapting and embedding itself more deeply into Palestinian life in Gaza.
Hamas was founded in 1987 as an offshoot of Egypt's Muslim Brotherhood. Its military wing has been responsible for rocket fire on Israeli communities, suicide bombings and the kidnapping of an Israeli soldier who is still being held.
Hamas's armed wing claimed responsibility for a deadly attack on four Israelis on Tuesday. All four were killed, including a pregnant woman, in a drive-by shooting near the settlement of Kiryat Arba in the West Bank.
The killings come on the eve of peace talks between the Palestinian Authority and the Israeli government. Hamas is not included in the talks and has rejected them.
Its political wing won Palestinian legislative elections in 2006 after popular discontent with the rival Fatah movement, which dominates the Palestinian Authority.
Just over a year later, lingering tensions between the two groups burst into violence in Gaza. Fatah was expelled from Gaza after a brief but bloody Palestinian civil war. Ever since, Gaza has lived under one government and the West Bank under another.
Before the Hamas takeover, Gaza was virtually lawless. Kidnappings, murders and thefts were rife. These days, Hamas' control has vastly improved security. On almost every street corner, there is a Hamas policeman dressed in black carrying a weapon.
Discontent Among Some
But not everyone is pleased with Hamas rule.
Sitting outside on a warm summer evening, a young medical student who does not want her name used because she fears repercussions says that Hamas cares only about Hamas.
"Many things have changed here. Those that are with Hamas, they become stronger because they are supported by Hamas. And also, all hospitals of Gaza are now managed by people related to Hamas. All doctors, even if they are qualified, are removed because they are not Hamas," she says.
The student, who has a heart-shaped face wrapped in a colorful headscarf, says she is apolitical, but she worries that without the right political connections she won't be able to practice medicine in Gaza.
And she says she doesn't dare complain publicly.
"We are afraid to speak in front of anyone related to Hamas because they will say those people are talking about Hamas," she says.
In recent months, Hamas has put in place a series of new rules that mainly target women. The latest is a ban on displaying women's underwear in local shops.
Gaza merchant Samer Saleh says four men came into his shop and took him to the police station, where they made him sign a paper promising not to showcase the items, either outside or inside the store.
Women also have been barred from smoking in public and riding motorcycles.
A doctor by training, Mahmoud al-Zahar is now Hamas' foreign minister.
He says Hamas does not discriminate against women.
"You cannot compare between us and the Taliban. We educated our people, our children, our women equally," he says.
Some Gazans feel the new rules are aimed at bolstering Hamas' Islamist credentials. New groups -- some of them inspired by al-Qaida -- have emerged in Gaza over the past few years with the objective of creating an Islamic caliphate. These militants see Hamas as too soft and too narrowly focused on the Palestinian cause.
Since a punishing war with Israel a year and a half ago, Hamas has been observing a cease-fire. Palestinian rocket fire that used to rain down on Israeli communities near Gaza has largely stopped.
Zahar defends the agreement.
"We are not interested to have every day war," he says.
But analysts say that Hamas is keeping quiet because it was severely weakened in the recent conflict with Israel, both militarily and in terms of its popular support in Gaza. The blockade of Gaza has only increased people's disaffection.
Electricity Crisis Is Latest Challenge
The latest blow to Hamas' popularity here is a burgeoning electricity crisis.
On a recent sweltering evening, Iyad al-Jalous and his family are about to break the daily fast Muslims undertake during the holy month of Ramadan.
He walks around the room lighting candles while his six small children crouch on the floor waiting for dusk and the evening meal.
There is no electricity. The shortage is the result of a continuing dispute between the Palestinian Authority in the West Bank and Hamas.
Each side blames the other for the outages. The Palestinian Authority is responsible for electrical power in both the West Bank and Gaza. It says Hamas isn't contributing its fair share of costs. Hamas says the Palestinian Authority is engineering the power cuts to embarrass its rival.
The two movements have tried repeatedly to reconcile over the issue, without success. The practical implications of the impasse are playing out in this small, dark concrete house.
Like many Gazans, Jalous is too poor to own an electric generator. At the moment, the family has electricity only every other night.
"It's unbearable. I have to go and sleep by the door when the electricity switches off. We are so bathed in sweat; it's like we are in a soup," he says.
Jalous says he holds Hamas responsible for the blackouts.
"Two things make my life this Ramadan impossible," he says with a wry laugh. "Fasting and Hamas."