Israel-US Analysis: West Jerusalem Runs Settlement Circles Around Washington

The responses came quickly to Israel's announcement on Monday that 1,300 Jewish homes had been approved for construction beyond the Green Line in East Jerusalem and another 800 homes had been endorsed in the West Bank settlement of Ariel.

The State Department conveyed its "disappointment". The European Union urged Israel to reconsider its decision, and President Obama warned that the construction  in East Jerusalem could obstruct the pursuit of peace in the Middle East: "This kind of activity is never helpful when it comes to peace negotiations." 

The office of Israeli Prime Minister Benjamin Netanyahu, who is on a five-day tour of the US, Office fired back quickly, saying that "Israel does not see any connection between the peace process and the building and planning policy in Jerusalem, which hasn't changed for 40 years."

The State Department's response was now beyond simple "disappointment". Spokesman Philip J. Crowley said:

There clearly is a link in the sense that it is incumbent on both parties, as we've insisted all along, that they are responsible for creating conditions for a successful negotiation. To suggest that this kind of announcement would not have an impact on the Palestinian side I think is incorrect.

Obama took over the war of words on Wednesday:

Israelis and Palestinians restarted direct talks, but enormous obstacles remain. But let there be no doubt: we will spare no effort in working for the outcome that is just, and that is in the interest of all the parties involved: two states, Israel and Palestine, living side by side in peace and security.

It was up to Netanyahu to play down the tension with Washington. He said that Israel's latest building plan was "overblown" but then accused Palestinians of not "recognising Israel as a Jewish state" which, was the main reason that negotiations are deadlocked. Before his meeting with US Secretary of State Hillary Clinton, Netanyahu continued the tactical manoeuvre: "We have broad understandings with the United States on this issue and many others that surmount the disagreements over other matters."

The outcome? Having given an additional $150 million to the Palestinian Authority, Clinton said that that a peace deal in the Middle East was still possible, despite Israeli construction on land that the Palestinians want for their state:

I believe strongly that negotiations are the only means by which the parties will be able to conclude an agreement that will lead to a Palestinian state and Israel living in security with its neighbors. That is our view. That is our commitment.

Clinton added: "We do not support unilateral steps by either party that could prejudge the outcome of such negotiations."

Washington does not support unilateral steps, but its emphasis is on the negotiating table. So give the victory to Netanyahu: the emphasis will continue to be on whether the Palestinian Authority comes back to talks rather than on the Israeli settlements. Six weeks after the expiry of its moratorium on settlement expansion --- which only covered the West Bank and not East Jerusalem --- it is Israel that retains the freedom of manoeuvre.