Now what, indeed. 

Israel has refused to progress to the second phase of the cease-fire, in which it would have been obligated to withdraw from Gaza in stages in exchange for 24 living hostages. They offered instead an extension of Phase 1 to exchange those hostages for more Palestinian prisoners, but Hamas refused -- since the hostages are the only leverage they have. The Israeli negotiators packed up and went back to Jerusalem.

So ... now what?

Two Egyptian security sources had told Reuters the day before that Hamas disagreed with the plan to extend the first phase of the hostage deal and wanted to proceed with the second phase. The Israeli delegation went to Cairo and wanted to reach a deal to extend its first phase for an additional six weeks.

An official told The Jerusalem Post that such an extension would involve the release of four male hostages – who are all fathers – and others who are critically wounded, in exchange for prolonging the ceasefire during Ramadan.

The terrorist organization called on mediators and the international community to pressure Israel to "fully commit to its role to the agreement" and to immediately enter the second phase."

Benjamin Netanyahu called a cabinet meeting to discuss the "now what" question late yesterday, which uncharacteristically ran over into Shabbat. Whatever "now what" entails, it doesn't include more talks in the short term:

After the Hamas announcement, Hebrew media reported that Prime Minister Benjamin Netanyahu scheduled consultations with senior ministers and defense officials on the state of the deal at 7:30 p.m. Saturday. The premier also held an extensive telephone discussion on Friday evening, which, in a rare instance, continued into Shabbat.

Officials from Israel, Qatar, Egypt and the United States had been involved in negotiations on the second phase in Cairo, with negotiators from Jerusalem returning home on Friday. Hamas did not attend the negotiations, but its position has been represented through Egyptian and Qatari mediators.

Basem Naim, a member of Hamas’s political bureau, told the Associated Press there had been “no progress” before Israeli negotiators left Cairo.

It was unclear whether those mediators would return to Cairo to resume talks on Saturday as had been expected, and Naim said he had “no idea” when negotiations might resume.

It certainly looks like both sides are preparing for war. Hamas worries enough about it that it has released a new propaganda video of a living hostage. They clearly want to ramp up domestic pressure on Netanyahu to commit to a withdrawal from Gaza in order to get the rest of the hostages out:

The Hamas terror group has published a propaganda video showing hostage Iair Horn, who was released from captivity two weeks ago, saying goodbye to his brother Eitan, who is still being held in the Gaza Strip.

The video shows Iair Horn, Eitan Horn, Sagui Dekel-Chen, and two more hostages whose identies are unknown as Hamas blurred their faces in the video, sitting in a room. ... 

Eitan Horn calls on the Israeli government to sign on the second phase of the ceasefire deal and secure his release.

That is in itself a war crime, worth noting even if the rest of the world keeps ignoring Hamas' track record. Hamas has conducted psychological warfare as well as other atrocities in their attempts to humiliate the Israelis during the entire war. Will this be an effective method to push the Israeli public into demanding an end to the war? It certainly has had an effect on public opinion in Israel, but perhaps not to the extent that the Israelis will opt to live with Hamas in control of Gaza -- which is what will happen with phases 2 and 3 of this current framework.

On the other hand, the US just sent a signal of its own:

The US State Department told Congress on Friday that it plans to sell nearly $3 billion in weapons to Israel, including thousands of bombs and $295 million worth of armored bulldozers that had been held up by the previous administration over human rights concerns that US President Donald Trump has largely eschewed.

The prospective weapons sales were notified to US Congress on an emergency basis, meaning they will not be subject to review by the House and Senate’s foreign relations committees. Trump’s predecessor, US President Joe Biden, also utilized the measure to approve arms sales to Israel during the war in Gaza.

In a statement, the US Defense Security Cooperation Agency (DSCA) said US Secretary of State Marco Rubio “has determined and provided detailed justification that an emergency exists that requires the immediate sale to the Government of Israel of the above defense articles and defense services in the national security interests of the United States, thereby waiving the Congressional review requirements.”

Bombs and bulldozers have a clear purpose, and it's not urban renewal, at least not in the civic-engineering sense. Trump has warned Hamas that a failure to release the hostages will result in "all hell breaking loose," although he has deferred to Netanyahu on overall war strategy. The emergency shipments of this materiel signal that Israel needs them right now. And the Qataris and the Egyptians will understand that even if Hamas' Billionaire Boys Club in Doha refuses to consider it. 

So what now? This is the impasse that has existed since October 7, and really since Hamas seized power in Gaza two decades ago. Hamas wants nothing short of the annihilation of Israel and will continue to start wars to that end. Israel cannot afford to have Hamas in control of a square inch of any territory on their borders. There is no negotiating around those points. Hamas wants an existential war, and Israel wants to exist. Even if we get to a Phase 2 of some sort, this two-decade impasse will still exist, and all that takes place will only delay yet another full-scale reckoning. 

The only real question is whether the Gazans want to exist. If so, then they need to eject Hamas and capitulate to end the war. If not, war is what they will have. And now, most likely.