TORONTO — Hamas committed a serious miscalculation by triggering the recent eight-day border war with Israel, says Dennis Ross, the former U.S. envoy to the Middle East.

In a speech in Toronto last week, he suggested that Hamas laboured under a grand illusion in thinking that Israel would not respond harshly to a significant upsurge in rocket attacks.

Hamas incorrectly assumed that Israel would bow to a “new normal” of increased rocket barrages, Ross said in delivering the Joseph and Gertie Schwartz Memorial Lecture at the University of Toronto’s Centre for Jewish Studies.

In recent months, he explained, the lulls between rocket assaults were steadily decreasing. Hamas, too, was not only taking direct responsibility for these attacks, it was no longer even trying to stop more radical groups, such as Islamic Jihad, from attacking Israel, he said.

Hamas also miscalculated by assuming that Israel would exercise restraint due to three interlocking factors: the forthcoming Israeli election, Israel’s preoccupation with Iran’s nuclear program and Israel’s desire not to offend the new Islamic government in Egypt.

Thanks to the U.S. and Egyptian-brokered ceasefire that ended the fighting, life for Israelis will improve in the next few months, Ross said. But over time, the truce will likely erode, just like previous ones, he warned.

Ross praised Egyptian President Mohammed Morsi for playing a key role in arranging last week’s truce. By doing so, Morsi elevated Egypt’s status as a regional power.

Although he threw his support behind Hamas and remains anti-Israel to the point of refusing to maintain direct contact with Israeli leaders, Morsi adopted a practical rather than an ideological approach to peacemaking at precisely the right moment, Ross said.

Morsi’s decision to broker the ceasefire in conjunction with the United States stemmed primarily from a desire to get much-needed economic assistance from the United States and the International Monetary Fund.

Morsi can’t ignore anti-Israel sentiment in Egypt, but by the same token, Morsi realizes that Egypt’s economy is dependent on outside help, Ross said.

The United States will support Egypt’s requests for further economic aid if it respects the rights of the Christian Copt minority and of women, and if it preserves a pluralistic political democratic system and hews to its 1979 peace treaty with Israel, he said.

 He said Turkey, a rising power in the Middle East, did not play a meaningful role in arranging a truce, because it has downgraded its once-close political relationship with Israel.

Ross predicted that 2013 will be a decisive year in determining whether Israel or the United States go to war to stop Iran’s militarized nuclear program.

Before Washington turns to other options on the table, it intends to embark on a last-ditch diplomatic campaign to induce Iran to abandon efforts to build a nuclear arsenal.

 U.S. policy, he said, turns not on containing Iran after it becomes a nuclear power, but on preventing Iran from acquiring a nuclear device in the first place.

Claiming that Iran is feeling the brutal effects of international economic sanctions, Ross said its currency and oil exports, accounting for 85 per cent of its revenues, have taken a big hit. Nevertheless, Iran is sticking to its ideological guns in its standoff with the west, said Ross.

In comments on the Arab-Israeli dispute, he said a two-state solution is in Israel’s national interest. He pointed out that Israel may lose its Jewish and democratic characteristics if current demographic factors don’t change.

He said the real problem between Israel and the Palestinians boils down to “disbelief” – neither side believes the other really wants a two-state solution.

“You have to change the dynamics,” said Ross, who was instrumental in helping Israel and the Palestinian Authority reach territorial agreements in 1995 and 1997 and Israel and Jordan sign a peace treaty in 1994.

He outlined a plan to foster a new sense of trust between Israel and the Palestinian Authority:

• Israel should offer compensation to Jewish settlers in the West Bank who leave settlements voluntarily.

• Israel should not build in areas of the West Bank it plans to give up within the parameters of a peace treaty.

• Area C in the West Bank, which fell under full Israeli security control under the 1993 Oslo accords, should be opened to Palestinian economic activity. Israeli military incursions into Area A of the West Bank, which is under Palestinian civil and security administration, should be kept to an absolute minimum.

For their part, the Palestinians can show they’re serious about a two-state outcome by placing the map of Israel in school textbooks, government documents and websites.

They should also acknowledge Israel’s historical connection to the land, stop hailing suicide bombers as heroes and martyrs, prepare Palestinian public opinion for compromises, replace refugee camps with permanent housing and continue building the institutions for future statehood.

Taking aim at critics who claim that U.S. President Barack Obama is unfriendly toward Israel, Ross said he stoutly defended Israel during Operation Pillar of Defence and has done more than any other president to nurture Washington’s security and intelligence alliance with the Jewish state.

“There’s nothing more important than security for Israel,” he declared.

But like all his predecessors, Obama has had his differences with his Israeli counterpart, he said.

The proper role for U.S. diplomacy in the Middle East is “active engagement,” Ross said, adding that the United States cannot impose a solution.