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Israeli police began arresting settlers resisting the building moratorium, and their leaders reject PM Netanyahu's plea to respect the order. Defense Minister Barak says settlers can continue to authorize minor construction projects. Middle East Progress interviews Special Envoy George Mitchell. The world financial crisis is spurring new Jewish immigration to Israel. The EU is likely reject a Swedish proposal to recognize occupied East Jerusalem as the Palestinian capital. A Kuwaiti newspaper says captured Israeli soldier Gilad Shalit has been moved to a secret location in Cairo in preparation for prisoner swap. Israeli occupation forces raid the West Bank village of Jenin. YNet argues that Netanyahu cannot reverse course on the settlement moratorium. The Jerusalem Post looks at international moves to boycott Israel and Israeli military efforts to use new social media for propaganda purposes. A commentary in the Guardian says Israel's abuse of Bedouins in the Negev desert shatters the myth that Israeli democracy. Michael Young argues that critics of Pres. Abbas make little sense. The Jordan Times calls Israel's stripping of Jerusalem residency from Palestinians ethnic cleansing, and Daoud Kuttab says the future of peace talks will be determined in the next few weeks.
Clashes occur in occupied East Jerusalem as Jewish settlers continue to evict Palestinian families, and a new report finds that Israel canceled Jerusalem residency for thousands of Palestinians in 2008. The EU has proposed recognizing East Jerusalem as the Palestinian capital and strengthening Palestinian institutions in the occupied city. Bethlehem shopkeepers are hoping for a more prosperous Christmas. Israel's consul general to the Pacific Northwest says his country wants peace. Israeli settlers continue to vow to defy the building moratorium and scuffle with building inspectors and Palestinians. Public building in the West Bank has dropped 60% since Netanyahu took office. Speculation continues about the potential inclusion of jailed Fatah leader Marwan Barghouti in a possible Israel-Hamas prisoner exchange, with the possibility that he also may be exiled. Hamas says one of its fighters has been killed. Foreign Policy magazine has included PM Salam Fayyad in its list of 100 leading global thinkers. David Makovsky argues that both Netanyahu and Abbas need to be strengthened in order for peace to proceed. The JTA profiles the "Islamic Movement" organization among Palestinian citizens of Israel.
The New York Times says the Obama administration needs a more imaginative approach to peacemaking. After settlers vow to defy the construction moratorium, and describe Pres. Obama as "the enemy of the Jews," Israel hires more building inspectors. The Christian Science Monitor interviews Hamas official Aziz Dweik. UN Secretary-General Ban Ki-moon stresses the importance of creating a Palestinian state. German mediators are reportedly attempting to finalize a prisoner exchange between Israel and Hamas, but Mossad has recommended that Fatah leader Marwan Barghouti not be included. Quartet envoy Tony Blair says without a two state agreement there will be a "hell of a fight." YNet urges Netanyahu to take responsibility for Minister Limor Livnat's description of the Obama administration as "awful." The National profiles employment difficulties facing Palestinian women in Israel. Al-Hayat compares the difficulties faced by El-Baradei and Mitchell dealing with Netanyahu and Ahmadinejad. Rami Khouri says the Palestinians should call Israel's bluff and returned to negotiations with an aggressive agenda. Yossi Alpher argues that the PA government state building plan provides hope in the West Bank, but a different approach is required for Gaza.
The New York Times says both Israel and the Palestinians have concluded the other side does not want a peace agreement. Right-wing Israelis express outrage at PM Netanyahu's partial settlement moratorium, but reports suggest that new housing is still being approved and that in reality construction will continue apace. Palestinians also reject the announcement. Reuters looks at the plight of Gaza's homeless. At least one Palestinian is killed in an Israeli airstrike on northern Gaza. Israel is to remove 90 Fatah members from its "wanted list." Speculation continues that any possible prisoner swap between Israel and Hamas will include jailed Fatah leader Marwan Barghouti. Alex Fishman argues that Israel must move quickly to save the collapse of the PA in order to prevent chaos. Israeli Culture and Sports Minister Limor Livnat describes the Obama administration as "awful." The Jerusalem Post analyzes the political crisis facing Pres. Abbas. The National profiles a graffiti campaign between Hamas and Fatah in Gaza.
Today's news again focuses on a possible Hamas-Israel prisoner swap, and the LA Times argues that an agreement would harm Pres. Abbas. Xinhua claims that Israel is rejecting the release of 40 prisoners, while Asharq Al-Awsat says the deal now hinges on a single prisoner. Hamas leaders say the next 24 hours are crucial and accuse Israel of manipulating the process. Speculation grows that the deal might include senior Fatah leader Marwan Barghouti. Mideast Envoy George Mitchell reportedly visits an Israeli settlement, and Libya is planning to introduce a Security Council resolution on the settlements. Abbas reiterates complaints that the US is not doing enough to promote peace. A commentary in the Guardian says Israeli-Syrian peace talks are a distraction. The Financial Times argues that Obama still has leverage over Israel, while Al-Hayat claims he has been outmaneuvered by "neoconservatives." The New York Times reviews a controversial new book on Jewish history by Israeli professor Shlomo Sand. An original ATFP translation of an Al-Ayyam article by Hassan Al-Batal analyzes Israeli reactions to the PA government state building plan.

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