Bush's man starts work

"We'd like to be able to have an envoy to focus very specifically on helping with some of these institution-building tasks for the Palestinian Authority," said Condi’s book carrier, Mr Casey.

"But my understanding is there's certainly no envisioning that this individual would be a negotiator on behalf of the Quartet between the Israelis and Palestinians."

In her statement welcoming Mr Blair's appointment, Dr Rice described his task as creating "viable and lasting Palestinian government institutions", strengthening "the Palestinian economy" and establishing "law and order for the Palestinian people". She made no mention of mediating peace talks.

Aaron David Miller, an expert on the Arab-Israeli conflict who advised six secretaries of state, said: "If he [Mr Blair] thinks he's going to be the lead negotiator to set the stage for a political process leading to a two-state solution, it's hard for me to believe that he really believes that.

"I know that's not the role that either the President or the Secretary of State wants for him."

Mr Miller added: "There is no US secretary of state worth his salt - and I worked for six of them - who would ever allow anyone else to have that kind of responsibility."

Instead, Mr Blair's task will be confined to reviving the economies of Gaza and the West Bank and sorting out the Palestinian Authority's shambolic ministries.

James Wolfensohn, the former head of the World Bank, held this job until he resigned in disgust last year.

Israel routinely strangles any economic activity by sealing off the occupied territories and halting the movement of goods and people by using checkpoints and security barriers.

Unless Mr Blair can persuade Israel to lift these restrictions, economic recovery in the occupied territories will be impossible.

"The odds on his getting frustrated quickly are high," said Mr Miller.

"If he lacks the capacity to be tough with the Israelis on the whole host of issues relating to movement - checkpoints, crossing points and all the rest - then his role is essentially Operation Tin Cup. He will carry a tin cup around the world and raise money and not much else."