Neither Israeli PM Benjamin Netanyahu nor Palestinian Authority Chairman Mahmoud Abbas is ready or politically able to make the concessions that are needed for peace.

Netanyahu can't withdraw from any settlements. He is hemmed in not only by his coalition, which could be replaced, but also by his own Likud party, which would replace him as its leader. Abbas cannot concede either the Palestinian demand for return of the refugees to Israel, or his insistent demand for every square meter of east Jerusalem. Probably, he cannot recognize Israel as the state of the Jewish people, a minimal condition for peace. If Abbas made those concessions, his own Fateh leadership would probably show him the door. As it is, Hamas extremists continue to attack the peace process both verbally and with West Bank terror attacks, which underscore the fact that Abbas and the Palestinian Authority don't even control their own territory.

According to the public demands of the Palestinians, the area in question includes Jewish neighborhoods of east Jerusalem, including Ramat Eshkol, French hill and the Ramat Shlomo neighborhoods, the Jewish quarter of the old city, Neveh Ya'akov and the Hebrew University campus at Mt. Scopus. as well as larger cities and towns such as Ma'aleh Edumim, Gush Etzion, and Efrat. Some of these "settlements" have thousands of inhabitants who have lived in them for forty years. Children were born and grew up there. Some of the communities existed before the state of Israel was created, and some have existed since the days of the Ottoman Empire.

There are over 500,000 Jews, about 10% of Israel's Jewish population, in the West Bank and east Jerusalem. The Palestinian Authority insists that none of the settlers can live in a Palestinian state and also insists it will make peace only if all this territory is incorporated in Palestinian state. Even if they did not object, it is rather difficult to relocate 500,000 people, and politically a non-starter. Netanyahu cannot accept these demands and Abbas knows it. For his part, Netanyahu is quietly demanding an Israeli presence in the Jordan valley, and he must know that the Palestinians will never agree to that either.

The Palestinians demanded a permanent freeze on new settlement construction before renewing negotiations. This is a reasonable demand, provided there is any prospect that the negotiations will make progress and finish some time. There is no point to Israel building in territories that will be given up. If the negotiations drag on because of Israeli intransigence, the new construction will rob Palestinians of areas they want for their state. On the other hand, if the negotiations continue forever because of Palestinian intransigence, then a freeze on new settlement construction amounts to an Israeli concession of the entire disputed area in advance.

The Americans backed the Palestinian position. Netanyahu refused to undertake a complete freeze of new construction at first, citing existing verbal agreements with the Americans, Then Netanyahu agreed to a ten month temporary settlement construction freeze. Anyone could foresee that the date set for the end of the construction freeze would come, and that unpleasantness was sure to ensue, and of course, it did.

Even before the end of the freeze, trouble flared in March when Israelis announced plans to build in Ramat Shlomo, a Jewish neighborhood of east Jerusalem. The Americans angrily vetoed the plans. The east Jerusalem issue was never officially resolved. As far as the Americans and Palestinians are concerned, Israel is not building in east Jerusalem. As far as the Israeli government is concerned, Israel never stopped building in east Jerusalem. Netanyahu could never admit to his supporters that he had stopped building in east Jerusalem; Abbas could never admit that he kept talking while Israelis were building in east Jerusalem. Real relity and diplomatic reality are different things.

The compromise temporary freeze brought the Palestinians into indirect negotiations. The Palestinians then agreed belatedly to direct negotiations, but apparently only after the Americans convinced them that the U.S. could pressure Israel into accepting a permanent construction freeze.

But the day of reckoning came. Evidently it caught the Israeli government and everyone else by surprise. The Americans and Palestinians did not believe the Israelis would start building. The Israelis don't believe the Palestinians will walk out. Nobody thought of the possibility that it might be ever be September 26, and now the everyone is scrambling for compromises. As if nobody could have anticipated this problem!!!

The settlers have already recommenced building in a triumphal and public way calculated to sabotage the peace effort. Mahmoud Abbas has equivocated. One report quotes him as saying:

"The negotiations will continue as long as the settlement (construction) remains frozen, but I am not prepared to negotiate an agreement for a single day more..."

. That seems pretty clear. However, another report has him saying

I cannot say I will leave the negotiations, but it's very difficult for me to resume talks if Prime Minister Binyamin Netanyahu declares that he will continue his activity in the West Bank and Jerusalem...."

Is he going to leave the talks over settlement freeze issue? You decide. Obligingly, the construction equipment and crews are all provided by Palestinian contractors. If the Palestinians don't want settlement construction, all they have to do is stop building settlements. We have to remember that it is all a show for foreigners.

In the short run, both sides have every incentive for walking away from the peace talks. In the long term, they don't have any option other than to continue the talks if they want to attain their supposed national objectives.

The U.S. is counting on this. As State Department spokesperson Phillip Crowley put it recently:

What Israel desires of this process, is peace and security, and recognition that Israel, going forward, will be an integral part of the region. What the Palestinians want is a state and opportunity and also peace. So the two are connected in that as part of a successful negotiation. Both sides have to get something of value. And then for that to be accomplished and be successful, both sides have to be able to provide something of meaning to the other side.

In the Middle East, logic doesn't always work. Or maybe there are a different set of premises held by the sides? Premises that the Americans are overlooking??

If Crowley's analysis were correct, then there would have been peace quite a while ago. Maybe the local leaders, like American politicians, want to stay in power by not making risky and unpopular decisions, and by satisfying their constituencies, or maybe they have a different understanding of the situation.

Netanyahu came to office as a champion of the settlers and a proponent of hard line diplomacy. One by one, he has abandoned his intransigent positions, agreeing to a Palestinian state and agreeing to a settlement construction freeze, with no quid pro quo. The empty posturing of the Israeli government has only served to antagonize the American government and fuel the enthusiasm of the Europeans for a Palestinian state. After nearly two years, Netanyahu has no achievement to show his constituency or anyone else in Israel. The is no peace, and the world blames Israel. As for his settler supporters, Netanyahu has to live with thisfact:

The number of housing units put up in the West Bank> during the Netanyahu government is the lowest under any prime minister since the first Rabin government.

Settlers are already hailing Netanyahu as a "hero" because kept his word about ending the settlement freeze.

But there will probably be a horrific price to pay for this domestic political victory. Israel may be totally isolated. The EU may support a unilaterally declared Palestinian state that lays claim to all of east Jerusalem as well as every millimeter of the West Bank, and the U.S. may support it as well. This Palestinian state, ruled by a Hamas - Fateh unity government, will certainly not recognize Israel as the state of the Jewish people. Netanyahu will have blown it big time.

Given Israeli resistance to the construction freeze, it is easy for Mahmoud Abbas to portray a construction halt as a victory.
Conversely, if Israel keeps on building in the settlements and Abbas walks away from the talks he will be a hero. But in the long run, he too may have achieved nothing for his people. The Palestinians will win nothing by walking away from the talks, and they won't get anything out of a settlement construction freeze, which must end sooner or later. No refugees will be given permanent homes if the Israelis don't build a single home anywhere in the West Bank or east Jerusalem, not a single checkpoint or Israeli soldier will be moved.

The key obstacle to peace is that the two sides are not really interested in peace. If they were, they could both agree on some compromise close to the (Bill) Clinton bridging proposals. The Palestinians and the Arab world would recognize that there is a Jewish people that has a right to self-determination in its own Jewish state. The Palestinians would get a state of their own, and Israel would have to withdraw its soldiers from most of the West Bank and east JJerusalem. Israel would have to stop building outside the agreed borders, and in a brief time there would be a Palestinian state in those places. But neither the Palestinian leaders nor the Israeli leaders want this result.

In a peace agreement, the settlement construction freeze and its extension would be utterly irrelevant. These are gimmicks that prevent serious progress towards peace. They were invented as part of an oriental entertainment for foreign guests, to prevent serious discussion of the issues. If Benjamin Netanyahu wrecks the peace process over this non-issue, he will certainly be walking into the trap that the Palestinians set for him. But that is equally true if Mahmoud Abbas walks away from the talks. They will both be "national heroes" who betrayed their people.

Ami Isseroff