The Obama administration on Friday laid out a bold shift in its Mideast peace strategy, stepping up pressure on Israel and the Palestinians to resume stalled talks by first taking on the tough issues of borders for a Palestinian state and the status of Jerusalem. On its face, the decision to tackle two defining and difficult issues that Israel has long refused to budge on would appear to be a major turnaround in long-standing American policy to push for incremental Mideast progress. But US officials stressed that the shift does not abandon the administration's comprehensive approach to peace and said their overall aim is get the parties back to the negotiating table, where all issues would be discussed. US Secretary of State Hillary Rodham Clinton said Friday that dealing with those matters first would eliminate Palestinian concerns about continued construction of Jewish settlements in disputed areas. After a meeting at the State Department, Clinton and Jordanian Foreign Minister Nasser Judeh called for negotiations to begin as soon as possible and be bound by deadlines. "Resolving borders resolves settlements, resolving Jerusalem resolves settlements," Clinton said. "I think we need to lift our sights and instead of being looking down at the trees, we need to look at the forest." Peace efforts in the past have tended to focus on broader issues, including Israeli settlements, the fate of Palestinian refugees, and water, with the even more contentious matters like borders and Jerusalem being left for so-called "final status" talks. Previous attempts to concentrate on the larger issues have ended in failure, notably the 2000 Camp David talks shepherded by former President Bill Clinton. At the end of the Clinton administration and through the eight years that George W. Bush occupied the White House, US officials shot for nuanced progress on more modest matters. On Friday, Judeh lent support to the new US tack. "If you resolve the question of borders then you automatically resolve not only settlements and Jerusalem but you identify the nature on the ground of the two-state solution and (what) it looks like," Judeh said. Both Clinton and Judeh spoke out against new Israeli housing construction in East Jerusalem, which the Palestinians claim as their capital, saying it was damaging to the process. Their comments came as the Obama administration's special Mideast peace envoy George Mitchell prepares to visit Europe next week and Israel and the Palestinian territories later this month to try to relaunch stalled negotiations. Mitchell will visit Paris and Brussels first to build support for the approach from European officials. When he travels to the region, Mitchell is expected to be carrying letters of "guarantees" outlining the US position. The letters are likely to contain gestures to both sides. For the Palestinians, that would include criticism of settlements and the belief that the borders that existed before the 1967 Arab-Israeli War should be the basis of a future peace deal. For the Israelis, they would acknowledge that post-1967 demographic changes on the ground must be taken into account, meaning that Israel would be able to keep some settlements. Clinton did not address the letters in her remarks. But she said the administration wanted a resolution that meets both the Palestinian goal of a clearly defined and viable state based on the borders that existed before the 1967 war "with agreed swaps" and the Israeli goal of security within boundaries that "reflect subsequent developments." Palestinian President Mahmoud Abbas has set several conditions for resuming peace talks, including a complete halt to settlement activity. He wants the talks to pick up where they left off in 2008, under Prime Minister Binyamin Netanyahu's more pragmatic predecessor, Ehud Olmert, and be based on the pre-1967 lines. Abbas has repeatedly said he won't return to talks without a settlement freeze and if he relents now, it might further hurt his standing among Palestinians who are increasingly skeptical about peace efforts. However, he could present US support for holding the talks based on the pre-1967 borders as a major achievement. Chief Palestinian negotiator Saeb Erekat was not optimistic Friday about the new tack. "You cannot have discussions on borders while the territory you want to set up your state on is being eaten up by the settlements," Erekat said. "We are awaiting the arrival of Sen. Mitchell, and we hope the US administration will go on the path of the end game. What we need are decisions now on the end game, on the borders," he said. But Netanyahu insists Jerusalem is not up for negotiations and must remain under Israeli sovereignty. He already lost ground with hawkish coalition partners by agreeing to curb settlement construction in the West Bank. After meeting Judeh, Clinton held similar talks with Egyptian Foreign Minister Ahmed Aboul Gheit and intelligence chief Omar Suleiman. "We are coming to try to regenerate enough energy and to create enough momentum for a peace effort and it is crucial that we would win," Aboul Gheit said. Egypt and Jordan are essential to the peace push as they are Israel's only Arab neighbors to have fully recognized the Jewish state.