US Secretary of State Hillary Rodham Clinton’s speech at the Brookings Institution on December 10 has again shown that the Obama administration is not willing to walk away from efforts to resolve the Israeli-Palestinian conflict in spite of the obstacles and setbacks it is facing. The position Clinton laid out presents an important potential opportunity for Palestinians to make the point that they are ready for and serious about peace, and to test Israel’s willingness.

Clinton delivered a well-balanced and clearheaded appraisal of US interests and was unambiguous about the importance of ending the conflict and the occupation. The secretary gave what is probably the strongest ever statement by a senior US official about Palestinian statehood, calling it “inevitable.” She described the occupation as “unacceptable” and “unsustainable,” and left no doubt that from the American perspective it must be ended.

Clinton also said the Obama administration plans to intensify its support for Palestinian state-building efforts. Since it now views Palestinian statehood as inevitable, Washington has a strong interest in using the state-building program to advance that cause in parallel to the diplomacy and to lay the groundwork for a successful, rather than a failed, state.

The secretary cautioned Palestinians against unilateral diplomatic moves, and Israel, in slightly stronger language, against “provocative announcements on East Jerusalem.” And she dismissed out of hand any notion of “economic peace,” saying that “economic and institutional progress ... is not a substitute for a political resolution,” and that such ideas are “wrong” and “dangerous.”

In addition, Clinton left no doubt that the US remains committed, perhaps more than ever, to resolving the conflict through an agreement that establishes a Palestinian state. US diplomatic language on this point is deepening and intensifying, and this reflects a growing policy commitment to that outcome.

Clinton also said the US will press the parties to make their positions on key final-status issues as specific and clear as possible. This could spell trouble for leaders on both sides (particularly Israeli Prime Minister Benjamin Netanyahu), who for political reasons prefers to remain ambiguous about some controversial questions. If the Palestinians present straightforward positions on the final-status issues and Netanyahu does not, it will not only be an enormously clarifying development, but will also potentially set the stage for a more assertive American role in spite of Israeli objections.

It would be wrong to be cynical when senior US officials make Washington’s commitment to this outcome so unmistakably clear. The US has many options, but the situation is so delicate that most of them would probably make matters worse. The path the administration has chosen – to make sure everyone understands what is expected at the end of the day and that the US is not walking away – and at the same time emphasizing caution and recognizing the delicacy of the politics on both sides while pushing them to reveal their own intentions, is probably the most advisable course at present.

A combination of quiet diplomacy, looking for openings with the parties and getting them to take clear, specific positions on core issues, along with intensified support for state-building, might be the only serious, politically plausible US response at this stage.

Palestinians were unwise to allow themselves to be sucked into the settlement freeze extension gimmick, and should welcome the opportunity to focus on final-status issues, such as borders and Jerusalem. In the end, any practicable agreement will require Israel to relinquish control over a considerable amount of the settlements it has built anyway, so the settlement issue is a subset of the border issue, which is the real bone of contention.

No matter how frustrated they might be with the failure to secure an extension to the partial, temporary settlement freeze moratorium, Palestinians should welcome the renewed and rhetorically intensified US commitment to ending the occupation and securing the establishment of a Palestinian state. The bottom line is that while Washington remains committed to Israel’s security, it is also committed, in its own interests, to Palestinian independence and an end to the Israeli occupation. In other words, the world’s only superpower and Israel’s patron is genuinely committed to securing the Palestinian national goal.

Clinton gave the Palestinians a lot to work with and welcome, but, like the Israelis, they have yet to convince Washington of their seriousness about achieving a negotiated agreement. They should embrace the secretary’s call for the parties to take clear positions on final-status issues and lay out their vision for the future as specifically as possible. They would then probably be able to demonstrate that their vision of the future is closer to the US view than Israel’s is, assuming the Israelis are willing to reveal any vision at all.

Palestinians would thereby give the United States every reason to increase its support for the party better in sync with its own policies.