THINGS have changed over the past decade between Palestinians and the United States, and much for the better. Yasser Arafat was enticed to attend the Camp David meeting in 2000 with the promise that he would not be blamed if it failed. It did, and he was. Last week Palestinian President Mahmoud Abbas was invited to attend the New York meeting without any such promise. He was not blamed, and the meeting was not a failure.

The meeting dealt with both an immediate crisis and a long-term strategic goal.

The crisis was generated by Israeli Prime Minister Benjamin Netanyahu’s refusal to budge on the total settlement freeze proposed by the US administration and by Abbas refusing to negotiate without it.

Entering the trilateral meeting, the Palestinians had no expectations that US President Barack Obama could deliver a 100 percent freeze or even find a way out of the crisis, let alone offer a commitment and a mechanism to advance a major strategic goal.

However, Obama refused to yield on his own demand for a freeze, set it aside for now, and responded by demanding an even more ambitious and strategic goal — the resumption of final-status issues, which Netanyahu did not exactly seek. In his speech to the UN General Assembly, Obama spelled out the parameters for these negotiations: Security for all, borders, refugees and Jerusalem. And to add clarity, he said the goal was to end the occupation that began in 1967, and declared settlement activity illegitimate.

Netanyahu may have won the first round on freezing the settlements, but he lost the case on their legitimacy. Moreover, the endgame is about establishing a Palestinian state, and that is very much in play. Netanyahu’s commitment to a two-state solution, now twice expressed in official pronouncements, will be seriously tested in new negotiations.

He stymied the quest for a settlement freeze, but he has yet to prove that his opposition was to this one specific issue, rather than to negotiating a genuine end to the conflict. Many parties have yet to be convinced that Israel is serious about ending the conflict because it thinks that it has an inexhaustible base of American support, even if it takes positions that are not aligned with the US national interest.

However, the strategic commitment by the US to Israel does not extend to its occupation of Palestinian land. Obama has made it unmistakably clear that the two-state policy is real, and that he is ready to take political risks to make it work.

The Palestinians know they cannot afford to loose the support of the American president, especially since he has called for immediate negotiations on all the issues, including Jerusalem, deemed settlement expansion illegitimate and invited them to work out the terms of reference. This package offers the Palestinians an acceptable way to resume negotiations.

Palestinians should continue to insist on a full settlement freeze. However to refuse to negotiate without it will simply mean there will be no negotiations, which cannot conceivably serve Palestinian interest. Their historic doubts about Netanyahu, no matter how justified, should not lead to an impasse they will pay for disproportionately.

When Obama asks the Palestinians to put an end to incitement, they should pay attention. It is significant that he found nothing else to ask of them. Outmoded rhetoric in the Arab media may score domestic political points, but comes at a withering cost to the Palestinian cause diplomatically.

The Israeli prime minister has defied the US president by refusing to agree to a complete settlement freeze. This has real consequences for Israel and its leadership. They may be hoping that Obama’s political fortunes sour given the challenges facing his administration and that they can garner more support in the US political system, or that the Palestinians will inadvertently bail them out and help blunt US demands.

They could well lose such a gamble. Obama might continue to be popular and remain insistent on resolving this issue. The American Jewish community is still solidly behind a two-state solution, as are the American people in general. Even a slight devaluation of the strategic relationship with the United States is a risk that Israeli leaders can ill afford.

Since there is no military solution available to either party, these two people must find a way to negotiate a means of living side by side in a narrow strip of land. And, since there cannot be meaningful negotiations without the active engagement of the United States, its policies and national interest are defining issues.

The evolving redefinition of US interests over the past decades inexorably led to official support for the creation of a Palestinian state by the Bush administration, and to the formation of the Quartet, which embodied international support. What we have now in this president and his administration, though they face a myriad of daunting challenges, is a leadership that offers the right policy and political will that might save the Israelis and Palestinians from their dysfunctional relationship.

What happens on the ground as negotiations resume is at least as important as the outcome of negotiations. The status quo — a one-state reality with that state occupying another, stateless, people — cannot be sustained.

The vigorous and proactive state institution-building program proposed by Palestinian Prime Minister Salam Fayyad is the most responsible and creative idea the Palestinians have put on the table since they accepted a two-state solution. The Quartet has just endorsed it. The United States should now mobilize its resources to make it work, and Israel would be wise not to stand in the way.

It seems that Obama is willing to spend resources and political capital to help the Palestinians create the infrastructure of their state, and negotiate its final status. His stand on the illegitimacy of settlement expansion and agreement on terms of reference for final-status talks should pave the way to renewed serious negotiations. After more than a decade of dramatic evolution, the United States led by Obama has finally become as close to an honest broker as the Palestinians can ever expect to be dealing with.

— Ziad J. Asali is president of the American Task Force on Palestine. Contact him at: zasali@att.net