Israel will manage, even without an agreement with the Palestinians, Defense Minister Moshe Ya’alon said Sunday, in contradiction to US Secretary of State John Kerry’s assessment that the status quo is unsustainable.Speaking of a possible agreement with the Palestinians, Ya’alon – at the Munich Security Conference – said he was not willing to talk about giving up “one inch” unless the Palestinians agree that “at the end of the process, the framework of the negotiations will include the recognition of our right to exist as a nation-state of the Jewish people, a finality of claims, giving up the right of return, and addressing our security needs. That is what is [being] discussed now. Hopefully we’ll get it. If not, we will manage.”The day before, Kerry’s message to the conference was that if the Israeli-Palestinian talks failed, matters would get significantly more problematic for Israel.“Today’s status quo absolutely, to a certainty, I promise you 100 percent, cannot be maintained,” he said. “It’s not sustainable. It’s illusionary.There’s a momentary prosperity, there’s a momentary peace. Last year, not one Israeli was killed by a Palestinian from the West Bank. This year, unfortunately, there’s been an uptick in some violence.But the fact is the status quo will change if there is failure.”Ya’alon’s comments indicate that despite the apology he issued last month for disparaging comments on Kerry’s peace-making efforts, the two men have profoundly different readings of the situation.Ya’alon apologized after being quoted as saying in a private conversation that Kerry’s diplomatic efforts stemmed from an “incomprehensible obsession” and “a messianic feeling.”On Sunday Ya’alon reiterated his position that the Israeli- Palestinian conflict was not a dispute over territory but over the Palestinian refusal to accept Israel as a Jewish state and to declare an end to the conflict, if and when there is an agreed-upon withdrawal from the West Bank.“The core of the conflict is not territory which was liberated or occupied or taken in ’67,” said Ya’alon, who added that he supported the Oslo process because he believes that human life is more important than land. “The conflict started early on since the dawn of Zionism, and unfortunately I don’t see a leadership on the Palestinian side that is ready to say that if we reach a compromise on territory, it would be the end of claims.”“I support the negotiations, I support any political engagement, but we should tell the truth to ourselves and not delude ourselves and to deceive ourselves regarding Abu Mazen’s intentions,” Ya’alon said, referring to Palestinian President Mahmoud Abbas by his nom de guerre.“Will Abu Mazen be ready to recognize our right to exist as nation state of the Jewish people?” Ya’alon asked. “We got a clear answer. Never.”The defense minister also rejected suggestions that Israel’s settlement activity was a sign that the government was not sincere about negotiating an agreement with the Palestinians.“Settlements are not the obstacle to peace,” he said.“The settlements include today less than five percent of the territory in the Palestinian arena. If we are going for peace – we have Arabs living side by side with us in Galilee and Jaffa and Acre; we don’t deny this right. Why does the Palestinian leadership insist on getting the territory without Jews? If we have to live together, we can benefit from each other.”Meanwhile, Meretz MK Nitzan Horowitz responded to the defense minister’s comment by saying “Israel can get by without Ya’alon. After he sabotaged relations with the US, the defense minister is continuing to harm Israeli interests. A peace treaty will ensure Israel’s future as a Jewish and democratic state and its social and economic growth. If Ya’alon doesn’t understand that, he is not worthy to continue in his position, and we will be better off without him.”Jerusalem Post staff and Lahav Harkov contributed to this report.