Is it any wonder that the Palestinians are insisting on a full settlement freeze before renewing peace efforts?

The latest Palestinian stand has put a damper on a recent US call to revive talks with no preconditions, but what should Washington or anyone else have expected? If the Obama administration is unable to force Israel to freeze Jewish settlement building, it will be foolhardy and naïve to expect the US, whose Congress is tightly controlled by the American Israel lobby, to give up the spoils of the 1967 war and allow for the creation of a genuine and viable Palestinian state with Jerusalem as its capital.

The new US plan, as broached by State Secretary Hillary Clinton, says that first agreeing on the borders of a future Palestinian state would help solve the problem of settlement building. Her call for a viable Palestinian state based on the 1967 lines is a crucial starting point for the Palestinians. But the caveat that a future state should reflect subsequent developments means that some Israeli settlements on occupied land will remain.

Round One of the Obama’s administration’s push for peace in the Middle East didn’t work. What about Round Two, as announced by Clinton? Changes in the new administration’s Middle East policies in 2009 were so slight as to be indistinguishable from those of Obama’s predecessor George W. Bush.

Like all US presidents, Obama promised to seek a just and lasting peace. Unlike others he evinced empathy with the Palestinian cause. His opening gambit seemed good: A freeze on all Jewish settlement in the occupied territories to resuscitate a comatose peace process. Obama was right to focus on settlements, but the climb-down was inexplicable after Washington came up with no Plan B when Israeli Prime Minister Benjamin Netanyahu refused.

Last year, all the parties got bogged down in the details of a settlement freeze. This time the endgame remains the same but the starting point has changed. Washington is now pushing the parties to go straight to talks about anything save the settlements. Many Palestinians refuse to give the latest ideas from Washington the benefit of the doubt. How can they when Netanyahu says every morning that settlement expansion will continue?

It is imperative to find a way around the impasse and get the talks started. Security, refugees, water, evictions, demolitions and the siege of Gaza are all elements that must be tackled, and the US is saying they should be addressed first. The US is formulating an offer to the PA whereby the Obama administration will see to it that a territorially contiguous Palestinian state would see the light within two years. But in the absence of credible guarantees clearly defining the endgame by the end of the period, the Palestinians might reach a situation where there would be nothing left to negotiation as Jewish settlement expansion devours whatever was left intact of the West Bank, especially East Jerusalem.

Instead of a settlement freeze, Obama appears to be pressing a two-year time frame for negotiations that will allow Netanyahu to colonize what remains of East Jerusalem and the West Bank according to his map. Justice to Palestinians and international legitimacy should be the guiding principles in this respect and Arab Peace Initiative meet those conditions admirably well.