NOW THAT DIRECT PEACE TALKS WITH THE Palestinians are restarting, the big question is how serious Prime Minister Benjamin Netanyahu is about making peace.Netanyahu says that “if there is a Palestinian partner,” he will “confound the skeptics”; the doubters point to 17 months of foot-dragging, his hawkish coalition and a welter of Israeli conditions that the Palestinians will find hard to accept.On the negative side of the balance sheet, Israel’s insistence on talks without preconditions has in effect created a situation in which negotiations begin without agreed terms of reference.The Israelis will be going to Washington in early September on the strength of a bland American invitation; the Palestinians will arrive brandishing earlier, more substantial statements by the international Quartet.For Netanyahu, the absence of “preconditions” will also mean scant regard for hundreds of hours of previous negotiations between the Palestinians and other Israeli governments; the Palestinians will want to use elements in their account of the negotiating record as a springboard for future agreements.Netanyahu’s demand that security issues be discussed and resolved first could also make things difficult. It means, for example, that the Palestinians would have to agree to an Israeli military presence in the Jordan Valley before even discussing their key demand for a border based on the 1967 lines. Netanyahu is also insisting that the Palestinians recognize Israel as the state of the Jewish people, a demand they reject outright.The most immediate threat to the talks though will be the Israeli Cabinet decision to resume building in West Bank settlements as soon as the 10-month freeze expires on September 26. In letters to US President Barak Obama and other key players, Palestinian President Mahmud Abbas has warned that if Israeli construction in the West Bank goes ahead, he will pull out of the negotiating process forthwith. Indeed, by constantly harping on the need for a genuine Palestinian partner, Netanyahu seems already to be preparing an alibi for failure, and jockeying for position in the blame game.On the positive side, Netanyahu has made a clearcut commitment to a two-state solution and assured a host of world leaders, including Obama, that he means it. He has also repeatedly said he intends to surprise people with far-reaching concessions.And he knows that if he fails to live up to expectations, he will have the Americans and the rest of the international community on his back.There are also signs in the Likud of moves designed to finesse the potential West Bank building pitfall. Intelligence Minister Dan Meridor is pushing for building only in the large settlement blocs that will remain part of Israel in any peace deal, and Michael Eitan, the minister charged with improving government services, has written in a similar vein to Likud activists, arguing that if Israel wants to be credited with coming to the peace table in good faith, it shouldn’t build in far-flung disputed areas that could become part of Palestine.Interestingly, in outlining his conditions for a final agreement, Netanyahu made no mention of Jerusalem. That could be setting the stage for a potential trade-off, in which Israel makes concessions on Jerusalem in return for Palestinian concessions on the refugee issue. This has been the tactic adopted by all Israeli negotiators since the failed Camp David summit in July 2000.Another potentially positive omen as far as the outcome of negotiations is concerned is Netanyahu’s distinction between the time frames for reaching an agreement and implementing it. Framing an agreement that does not entail immediate Israeli moves could encourage Netanyahu to go for it.As for the Palestinians, in public they are expressing deep pessimism.They paint a picture of Abbas, railroaded by the Americans and outmaneuvered by Netanyahu, forced into direct talks without any of his preconditions – for terms of reference or a firm commitment against the lifting of the Israeli construction freeze – having been accepted. Indeed, Palestinian critics see the resumption of direct talks with great fanfare in Washington as little more than a show for Obama ahead of the mid-term congressional elections in November.Privately, however, the Palestinians are saying that they are relying on Obama to deliver. Chief Palestinian negotiator Sa’eb Erekat won’t say whether the Americans have promised anything specific, but he does say that they are “very serious” about the peacemaking and that the Palestinians trust them implicitly.Indeed, the key to the success or failure of the talks could be the degree of US commitment and readiness to press both parties.Some Israeli commentators are saying Netanyahu may soon discover that he has walked into an American-Palestinian ambush, with strong pressure from Washington to cut a deal.The litmus test of whether things really are moving towards agreement will be the status of Netanyahu’s coalition. If the hawks stay in, chances are the parties will not have been making significant progress. But if they balk, and Netanyahu brings in the more peace-oriented Kadima to replace them, that will be a sign that things really are getting serious.