IN THE narrow bazaars of the West Bank’s old cities, peddlers ply rusty keys supposedly from the homes of 800,000 Palestinians uprooted by the war that created Israel in 1948. Long the symbol of the refugees’ clamour to return home, they are being bartered. “Last night I got $300 for the key to our Jaffa home,” says a precocious 18-year-old sporting a football shirt. He comes from the refugee camp of Balata, on the edge of Nablus, in the north of the Israeli-occupied West Bank, which Palestinians see as the core of a future state.

“It’s been too long,” says Mahmoud Subuh, a psychologist in Balata, where the population of 28,000 is crammed into a square kilometre of squat housing. “People don’t even dream any more” of returning to their old homes, he says. After 65 years as the fount of anger sustaining the struggle, the camps have degenerated into wretched inner-city ghettoes.

The UN, which has run the camps for all those years, is tired of the job. Balata’s alleys are caked in filth, a cash-for-work programme has all but collapsed, almost half the working-age adults have no jobs, and the UN’s once-prized classrooms are as overcrowded as the rooms where families live. Children sometimes leave school unable to write their names.

To the chagrin of many refugees, security chiefs under the aegis of the Palestinian Authority (PA) have joined Israel’s in seeing the camps as nests of gun-runners, drug-traffickers and car thieves. The PA’s security men have teamed with Israel’s to step up raids on the camps. Last month Israeli forces shot dead three civilians and wounded 17 in a botched raid on Qalandiya refugee camp, near Jerusalem, and killed another in Jenin, in the northern part of the West Bank. Palestinian forces also killed a refugee while making arrests in Askar, a camp close to Balata. And on October 5th the Jenin camp was again raided by PA forces.

People in the camps are fighting back. In Shuafat, on the edge of Jerusalem, refugees hurl breeze-blocks at Israeli jeeps. Askar camp inmates recently torched a military hospital and 16 security cars parked in its compound. Many Palestinian police in the camp joined in, sighs a PA security man, showing that they felt more loyal to the refugees than to the PA. The camps’ “popular committees”, which in recent years have acted like municipal councils, are rediscovering a taste for activism. The head of one, near Ramallah, seat of the PA headquarters, says young members are reviving the tanzim armed units that waged the second intifada (uprising) against Israel from 2000 until 2005 or so, when scores of suicide-bombings were carried out.

But whereas the camp’s angry young men used to attack Israeli targets, Palestinian officials managing the West Bank’s cities fear that they may now be the first to be hit. Camp leaders, who are often members of the (currently defunct) Palestinian legislative assembly as well as officials of the ruling party, have formed a new committee that in effect skirts the authority of the PA’s president, Mahmoud Abbas, who has got used to appointing the camp’s leaders.

Many of the challengers, says a loyalist of Mr Abbas, are financed by Muhammad Dahlan, a Palestinian strongman whom Mr Abbas exiled to Abu Dhabi. Mr Dahlan’s supporters in the camps have threatened to undermine the PA unless the 78-year-old Mr Abbas nominates Mr Dahlan as his successor.

Israel’s generals blame the recent killing of two of their soldiers in the West Bank, the first there for almost two years, on the PA’s weakening grip. Its leaders, say the Israelis, should crack down on the camps’ lawless youths. But Palestinian security officials fear they lack the ability and legitimacy to intervene on Israel’s behalf. The PA’s forces, who have been trained by Americans, “are persona non grata in the camps”, says a disconsolate PA man.

Privately Palestinian leaders in Mr Abbas’s orbit have toyed with admitting that, even if there is a deal with Israel, the refugees and their offspring will never return en masse to their old homes in Israel. With only 60,000 alive (8% of those who fled in 1948), there may soon be almost none left for the Israelis to allow home.

But leaving them put will do nothing to lessen the trouble they cause. Almost 70% of West Bank refugees already live outside camps. The refugee department of the Palestine Liberation Organisation, an umbrella group, is hoping Western countries will pay for decent new housing elsewhere. “We should settle the hills above Nablus with [Palestinian] refugees, not [Jewish] settlers,” says Said Salameh, the department’s head. A UN “beautification project”, installing swimming pools in Roman ruins and demolishing houses to create town squares, has raised spirits in some of the West Bank’s southern camps. So has a Qatari-funded housing project for refugees in Bethlehem. After 65 years of squalor, almost any new homes would be better.