The results of the American congressional election place President Barack Obama at a crossroads regarding the Israeli-Palestinian peace process. He confronts two options.

Under the first option, his painful electoral setback will oblige the president to devote the next two years to efforts to regain the support of millions of disappointed Democratic voters who stayed home on election day or punished him by supporting Republican candidates. Obama's Nobel Prize, awarded in part in recognition of his involvement in Israel-Arab peace efforts, did not console the millions of young American couples who have lost their homes or the hundreds of thousands of unemployed university graduates.

To restore their confidence, Obama will have to invest most of his political capital in domestic issues. To advance this agenda, he'll have to reach compromises with the Republicans, who in turn object to pressuring Israel and are more attuned to the conservative Jewish lobby.

Choosing this option is liable to mean, in the best case, turning the conflict over to the United Nations and thereby losing American control over the process. And in the worst case, it will mean expanded Iranian influence in the Middle East, increased violence and a decline in the status of pragmatic regimes in the region.

Under the second option, an aggressive Republican majority in the House of Representatives will tie Obama's hands and thwart administration attempts to move ahead with liberal reforms, lest Obama take credit for domestic successes that might enhance his reelection chances. By default, Obama will have to look for successes in the foreign affairs arena, and by default that search will bring him to the Middle East: the Israel-Arab conflict and the Iranian nuclear crisis.

The price Obama might pay for adopting this course is joining the list of American presidents who failed to bring about a permanent peace between Israel and the Palestinians, entering into confrontation with the government of Israel and losing support among Jewish organizations and contributors.

Obama is not the first Democratic president to contemplate such a dilemma in the middle of his first term and in the midst of efforts to advance a Middle East peace process. Nor is he the first president to confront a right-wing Israeli government led by Binyamin Netanyahu. In the November 1994 congressional elections, the Republicans won both houses of Congress and threatened to exploit public anger at the administration, turn President Bill Clinton into a one-term president and recapture the White House.

Then, as now, advancing peace in the Middle East did not guarantee the president and his party significantly greater popularity. Yet Clinton persisted in his efforts to save the Oslo process. In the fall of 1995, just weeks before entering a presidential election year, he signed a waiver to freeze a law passed by Republican presidential candidate Bob Dole and Republican House Speaker Newt Gingrich that mandated moving the US embassy in Israel from Tel Aviv to Jerusalem. A year later, on the very eve of elections and following rioting in the territories in response to the opening of the Hashmonean tunnel in the Old City of Jerusalem, Clinton compelled Netanyahu to shake the hand of Yasser Arafat, agree to a ceasefire with the Palestinians and enhance security cooperation with them. The pressure the administration began then to apply to Netanyahu soon produced the Hebron agreement that required him to forego control over part of that city's ancient quarter.

Clinton's pressure on Netanyahu was understood and even supported by the mainstream Israeli public to a greater extent than is Obama's pressure for a temporary settlement construction freeze. The Clinton-Netanyahu crisis of confidence contributed to Ehud Barak's victory and the return of Labor to power in Israel in the 1999 elections. In contrast, Obama's cold shoulder to Netanyahu and the tension over the construction moratorium have negatively influenced Obama's popularity in Israel--not Netanyahu's.

There are two reasons for this phenomenon. First, Clinton succeeded in building a personal rapport with the Israeli street. He projected a warm message: that he cares about Israel. Obama, in contrast, projects distance and cool, and has found little place in Israelis' hearts.

Second, Netanyahu model 2010 is different from model 1999. The Bar Ilan speech in which he embraced the two-state solution and, in contrast, the refusal by Palestinian President Mahmoud Abbas to meet with him, have portrayed Netanyahu as a more moderate figure both in Israel and abroad. His coalition partnership with the Labor party (which was not in his earlier government) adds another layer of pragmatism.

If Obama chooses the second option, he would be well advised to find his way into the hearts of Israelis and persuade them that he cares about them. Once he has reestablished Israeli confidence in the White House, he should abandon marginal tactics like the settlement freeze. Instead, he should present a bold American peace initiative that would enable the Israeli public to determine whether Netanyahu has indeed changed--or should be sent back to the opposition where Clinton put him 12 years ago.