THE COLLAPSE in April of American-mediated Israeli-Palestinian peace talks triggered Rashomon-like accounts of what went wrong and who deserved the lion’s share of blame.The American narrative began with US Secretary of State John Kerry’s “poof” moment before the Senate Foreign Relations Committee on April 8, ostensibly laying most of the immediate blame at Israel’s door.“Unfortunately, the [Palestinian] prisoners weren’t released [by Israel] on the Saturday they were supposed to be released… day [one] went by, day two went by, day three went by, and then in the afternoon, when they were about to maybe get there, 700 settlement units were announced in Jerusalem and, poof, that was sort of the moment,” he declared.In late April, Kerry spelled out what he saw as the dire consequences of failure for Israel and its leaders’ historic responsibility.Addressing a closed session of the Trilateral Commission of leaders and experts from North America, Europe and Asia, he implied that a myopic Israeli government was hurtling towards “an apartheid state with second class citizens” or a democratic state that would not be Jewish.Moreover, failure to reach a two-state solution could also lead to a new intifada.Palestinians, frustrated by continued occupation, might go “to dark places they’ve been before.” Kerry, however, suggested that the twostate process – in his view the only rational choice for Israel and the Palestinians – was not yet dead. “If there is a change of government or a change of heart something will happen,” he insisted. And he indicated that in a last desperate effort to get the parties to see reason, he might put an American peace plan on the table, saying, “Here it is, folks. This is what it looks like. Take it or leave it.”In launching his Sisyphean effort to broker a peace deal, Kerry first secured an agreement on conditions for reengagement.Israel would release Palestinian prisoners in four stages in return for which the Palestinians would refrain from applying to international conventions or agencies while talks continued. On the advice of US special peace envoy, Martin Indyk, Kerry’s plan was to embrace Prime Minister Benjamin Netanyahu, gain his trust and address his deepest concerns. In return, the thinking went, a confident Netanyahu would make concessions that would draw the Palestinians into a fruitful negotiating process.The Americans focused initially on Netanyahu’s key security and territorial concerns. On security, they produced a detailed state-of-the art plan for preventing arms smuggling and terrorist activity in the West Bank; on territory, they used a sophisticated computer program to draw new borders that would leave 80 percent of West Bank Jewish settlers in Israel proper.Israel, however, was not won over.According to the American narrative, it derided the security plan, did not accept the American map or offer an Israeli alternative. Nor did it make the concessions the Americans hoped it would: Agree to negotiate final borders on the basis of the 1967 lines with land swaps, or accept the notion of East Jerusalem as the Palestinian capital.By their own account, the Americans made several miscalculations. They were amazed at Israel’s lack of enthusiasm or urgency.They expected the government to recognize the huge benefits of a two-state solution and the dire consequences of failure to achieve it. They banked on Israel jumping at the chance of a historic game-changing peace deal once its concerns were addressed.But they were taken aback by the sense, especially on the government’s right wing, that the status quo could be maintained indefinitely with little cost to Israel.Moreover, they acknowledge, the fact that they did not insist on a settlement freeze for the duration of the negotiations played into the recalcitrant right-wingers’ hands.Indeed, they say they are convinced Housing Minister Uri Ariel of the right-wing Bayit Yehudi deliberately flaunted accelerated settlement building to torpedo the process.In Indyk’s view, settlement building was the main single cause of the collapse of the Kerry effort.Besides territory and security, Netanyahu injected another major concern into the equation – that the Palestinians recognize Israel as the state of the Jewish people. He“end of conflict” and a “finality of claims.”The Americans saw recognition of Israel as Jewish as stating the obvious. They failed to realize what a big deal it would be for the Palestinians – who saw it as a ploy to get them to endorse the Zionist narrative.Moreover, the tactic of coddling Israel came at a price. It meant no effective pressure on the Netanyahu government; it also alienated the Palestinians.Nevertheless, the Americans say the talks between the Israeli and Palestinian teams were useful in pinpointing differences on the core issues. In December, after five months of painstaking negotiations, Kerry embarked on a bridging effort, initially trying to turn the screws on Netanyahu.It was at this point that Defense Minister Moshe Ya’alon dismissed Kerry as messianic, obsessive and out to win a Nobel Prize. Netanyahu conditioned a positive Israeli response to suggested American terms of reference for a framework agreement on Palestinian recognition of Israel as a Jewish state. In mid-February meetings with Palestinian Authority President Mahmoud Abbas in Paris, Kerry failed to get the Palestinian president to accept the recognition demand.UPPING THE ante, US President Barack Obama invited Abbas to the White House on March 17, but also failed to convince him to make a recognition statement. Abbas retorted that Israel was not serious about peace and that the Jewish state demand was a calculated ruse intended to derail any chance of a negotiated settlement. He laid down four counter conditions that would test Israeli intentions: That Israel agree to negotiate borders on the basis of the 1967 lines with land swaps; that it accept the notion of Arab East Jerusalem as the capital of Palestine; that it agree to a timetable for withdrawal from territory allocated to the Palestinian state; that it accept a threemonth moratorium on settlement building while the border issue was resolved, after which it could build to its heart’s content in the settlement blocs it retained.Israel rejected the Palestinian leader’s demands out of hand. In response, the Palestinians threatened to pull out of negotiations as soon as the April 29 deadline for an agreement elapsed.The collapse of the process quickly followed. In late March, Israel delayed the fourth prisoner release insisting that the Palestinians first commit to extending the talks. The Americans tried to construct a compromise: In addition to the 30 prisoners it was due to release, Israel would free another 400, the US would release convicted spy Jonathan Pollard to Israel and the Palestinians would agree to extend the talks.But just as the parties were dotting the i’s and crossing the t’s on the “431” deal, Kerry’s poof moment arrived with the announcement of 700 planned new housing units in East Jerusalem. For Abbas this was the last straw. He immediately applied for Palestinian membership in 15 international conventions and turned his attention to reconciliation between his Fatah movement and the rival Hamas, which controls Gaza.On April 24, a day after the announcement of a new Fatah-Hamas reconciliation deal, Netanyahu officially suspended the peace talks, arguing that by forming an alliance with a terrorist movement calling for Israel’s destruction, Abbas had shown he was not a true partner for peace.The Americans accused both sides of making “unhelpful” moves, but seemed to suggest that Israel had started the slide.Indyk added fuel to the flames when he argued that Abbas had not bought into the proffered American package because he did not believe he had “a reliable partner on the Israeli side for the kind of two-state solution he was looking for.” With his careful choice of words, Indyk seemed to imply American sympathy for the Palestinian leader’s position.Indeed, Kerry’s disappointment in Netanyahu is immense. He made a huge investment in the Israeli leader – dozens of face-to-face meetings and phone calls on an almost daily basis – only to feel that, at best, he had misjudged Netanyahu’s political room for maneuver, or that, at worst, the prime minister had simply been stringing him along. This and mutual recrimination over the reasons for the breakdown have injected a sourness into the US-Israel relationship.Kerry entered the process on the assumption that conditions for an Israeli- Palestinian deal were optimal: a moderate Palestinian leadership, an Israeli leader who could deliver, a receptive Arab world and a strongly supportive international community. Obama, however, had been skeptical from the outset. For him, the fly in the ointment was the quality of leadership on both sides. Both Netanyahu and Abbas were politically constrained and, in his view, too weak to deliver even if they wanted to – in itself a moot point.ACCORDING TO the Israeli narrative, the American mediators made monumental blunders. They were naïve about the Arab world, especially in their failure to understand the depth of Palestinian rejectionism – as evidenced in the adamant Palestinian refusal to recognize Israel as the state of the Jewish people. Secondly, they had not pushed the Palestinians nearly hard enough. The Israelis also claim that the Americans were wrong about settlement building as the main cause of failure – since stopping the building had never been a condition for holding the talks.True, the Americans counter, but this is not really an argument against accelerated building being deliberately used as a means of undermining Palestinian confidence in the process. Another Israeli complaint was that the much publicized American warnings about what might happen to Israel if it failed to achieve a two-state solution had in them a prescriptive element of selffulfilling prophecy.In the Israeli view, however, the main cause of failure was Palestinian intransigence.Israeli officials describe Abbas as a “serial peace shirker,” arguing that whenever the two sides come close to peace, the Palestinian leader tends to back away. In the current round of talks, they point to his deal-breaking application to 15 international conventions when he knew the “431” deal was close to conclusion, followed up by his reunion with Hamas, which he knew Israel would not tolerate.On April 22, National Security Adviser Yossi Cohen sent a letter to Western governments arguing that the Palestinians had decided to break off the talks well before the delay in releasing the fourthbatch of prisoners. As evidence he attached a 65-page document by the lead Palestinian negotiator Saeb Erekat recommending joining international conventions and reconciliation with Hamas, submitted to Abbas on March 9 – a week before his meeting with Obama in Washington and three weeks before the projected fourth prisoner release. For Israel, this was the smoking gun. “The document,” Cohen wrote, “serves as damning evidence of bad faith on the Palestinian side.”According to the Palestinian narrative, it was Netanyahu who was never serious about peace. They say that his personal representative in the peace talks, Attorney Yitzhak Molcho, blocked Israel’s lead negotiator Tzipi Livni whenever she tried to move things forward; and that Netanyahu refused to commit to any reasonable negotiating framework, for example: the 1967 lines with land swaps as the basis for territorial negotiations, Arab East Jerusalem as the Palestinian capital or a time frame for Israeli withdrawal from Palestinian territory – all issues agreed to by previous Israeli leaders and endorsed by the international community.In the Palestinian view, Israel’s continued settlement building in areas potentially destined to become part of a future Palestine was a sign of bad faith. Moreover, after the Palestinian applications to the 15 international conventions and the Fatah-Hamas reconciliation, they say Netanyahu grabbed the opportunity to suspend the talks – without waiting to see whether the reconciliation might actually make a positive contribution by bringing Gaza and the whole Palestinian people into the equation.By contrast, the Palestinians argue, Abbas made huge concessions which the Israeli side failed to appreciate. For example, he agreed to borders leaving 80 percent of the settlers in Israel; to an Israeli military presence in the Jordan Valley for five years, to be replaced by US, not Palestinian, forces; to Jewish neighborhoods in East Jerusalem going to Israel; and to Palestinian refugee return being subject to Israeli approval.Moreover, the Palestinians also claim, as does President Shimon Peres, that in July 2011, Peres and Abbas reached an agreement on the core issues, which Netanyahu blocked.Netanyahu and the Israeli right did not seem overly dismayed at the collapse of the process. They believe time is on Israel’s side.They point to the overarching weakness of the Arab world, the entanglement of Hezbollah in Syria, Hamas’s loss of its Egyptian patron and a shared Israeli-Sunni interest against Shi’ite Iran; they note limited American capacity to pressure Israel, given traditional American support and in light of the upcoming mid-term US elections; they insist that European moves against Israel will be limited given Israel’s economic weight and its contribution against anti-Western jihadism; and they play up Israel’s growing economic ties with Asian giants like China and India, who do business without political considerations or moral judgments.GIVEN THESE geopolitical conditions, the government seems to believe that the occupation can be maintained indefinitely. Bayit Yehudi leader Naftali Bennett is already pressing Netanyahu to annex Area C – which constitutes around 61 percent of the West Bank. Netanyahu, well aware of the international explosion such a move would trigger, is unlikely to go along with it. But he is ready to maintain the status quo in the teeth of growing international opposition, which he believes he will be able to mitigate.His main tactic will be to denigrate Abbas at every turn and cast him as the inveterate rejectionist responsible for the continued occupation. Thus even when Abbas described the Holocaust as “the most heinous crime against humanity in modern history,” rather than welcome this obviously conciliatory statement, Netanyahu questioned its sincerity. This reflects a fundamental problem that dogged Kerry’s peacemaking from the outset: Netanyahu and the right tend to see the Palestinians as rivals in a zero-sum game, rather than as partners in a win-win peace effort.Where is all this going? There could be some dark scenarios for Israel: A breakdown of close security cooperation with the Palestinian Authority with all that that implies; economic moves against Israel, especially in Europe; US-Israel tensions; successful Palestinian applications to UN and other international agencies, with the US unable or unwilling to block them; European or other international initiatives to fill the vacuum left by an American diplomatic retreat. These could include calls for an imposed settlement.For example, one idea being bandied about on the pro-Palestinian left is that the international community give Israel three years to make up its mind – that by 2017, the 50th anniversary of the occupation, it annex the territories and give Palestinians full political and human rights in a unitary state, or withdraw to enable two states for two free peoples.Whether or not they take most of the blame, Netanyahu and Israel may well come to rue missing the opportunity Kerry tried so hard to create.