After three months of Israeli-Palestinian negotiations, US Secretary of State John Kerry will on Wednesday resume the diplomacy shuttle that characterized his intensive effort to get the talks started last summer, and which now seems to signal an impasse.Kerry arrived Tuesday evening and went immediately to Rabin Square in Tel Aviv to lay a wreath and take part in a ceremony marking 18 years since the assassination of prime minister Yitzhak Rabin. He is scheduled to meet Wednesday morning with President Shimon Peres and Prime Minister Binyamin Netanyahu before going to Bethlehem to meet with Palestinian Authority President Mahmoud Abbas. He will come back in the evening, as he did often over the summer, for another meeting with Netanyahu.During the brief ceremony at Rabin Square, Kerry promised he would continue to pursue peace, saying “America would stand by the side of Israel every step of the way” and that he believed peace was “something that is possible, is good for all, and... can be achieved.”Kerry said a “just, appropriate and fair peace” would ensure Israel’s security and make it possible “for people to live the words of the prime minister [Rabin]: ‘We are destined to live together.’ I add, in peace.”Government officials said Israel was keen on having the discussions with the secretary of state focus not only on the Palestinians, but also on Iran.Talks between Iran and the P5+1 (the US, Russia, China, France, Britain and Germany) will resume Thursday.Prior to Kerry’s arrival, Israeli and Palestinian teams met for the 16th time. The session came after reports that the negotiators had been unable to span the gaps between the Palestinians’ opening position for a state along the pre-1967 lines with land swaps, and Israel’s position that the security barrier be the border, with an Israeli presence in the Jordan Valley.According to those reports, Israel’s negotiators – Justice Minister Tzipi Livni and Netanyahu’s personal envoy, Yitzhak Molcho – disagreed over the size of the area in Jerusalem that would be designated a zone of free movement for Israelis and Palestinians.While Molcho wanted to restrict the area as much as possible, Livni, according to the reports, took a more liberal approach.Government officials said the leak about the issue was “untrue,” adding that regarding Jerusalem, Netanyahu’s position was that it would remain the united capital of Israel. The officials complained that the leaks did not contribute to a positive atmosphere in the talks.The leaks did, however, once again stir public discussion in Israel over the capital city, with Finance Minister Yair Lapid saying on Israel Radio that Jerusalem was “not a place, but an idea.” He called it the “founding ethos” around which the Jews returned to Israel.“If the Palestinians want a state, they must know that this has a price and they will not get everything they want,” Lapid said. He added that he did favor a two-state solution and that bringing it about would be “painful” and necessitate large evacuations that “will tear us to pieces.”Interior Minister Gideon Sa’ar made similar statements in an Army Radio interview, saying Israel would not agree to divide Jerusalem into two capitals, as the Palestinians were demanding. He said the Palestinians were not conducting the talks in “good faith” and were showing “no flexibility on their starting positions.”Meanwhile, Abbas – who a day earlier warned that the talks were on the verge of collapse – said he would pursue his efforts to “achieve a peaceful solution, security and stability in our region.”Abbas was speaking in Bethlehem during a press conference with visiting Polish President Bronislaw Komorowski, saying he wanted the negotiations with Israel to lead to the establishment of an independent and sovereign Palestinian state with east Jerusalem as its capital.Abbas once again complained that settlement construction and Israeli measures in Jerusalem were obstructing the peace process. He also complained about settler assaults against Palestinians and the continued imprisonment of thousands of Palestinians in Israel.However, he reiterated his commitment to pursuing the peace talks in the framework of the nine-month timetable set by Kerry.Khaled Abu Toameh and Jerusalem Post staff contributed to this report.