Jackson Diehl says the Obama administration may not have learned hard lessons about Middle East peace. The LA Times says conditions are not ripe for a new Palestinian uprising and that recent attacks are testing new Israeli security measures. Sec. Clinton urges the parties to resume negotiations. Special Envoy Mitchell says the US could reduce aid to Israel to induce cooperation on peace. Israel launches airstrikes that kill 3 in Gaza, issues threats to Palestinians, and is considering recognizing more unauthorized settlements. Gideon Levy says Israel's behavior can only be explained by psychiatrists. Israel is building a fence along its border with Egypt. The PA demands an apology from an extremist cleric who raised the possibility of stoning Pres. Abbas. PM Netanyahu criticizes Palestinian security forces. The Guardian profiles Palestinian refugees. The National says peace is still possible, the Jordan Times says Israel must agree to a settlement freeze and the Arab News says that Israel may use a two-year time-frame to increase settlements.