Part II of my conversation with Ambassador Aaron David Miller – public policy scholar at the Woodrow Wilson International Center for Scholars in Washington and a former US Middle East negotiator – completes our discussion of the Iranian situation, then moves onto the seemingly intractable problems with Israel’s Palestinian neighbors.We conclude with a discussion of the US-Israel relationship, and the contentious issue of the Jewish Nation-State bill on how Israel defines itself.The IraniansWould increasing sanctions on Tehran help? I understand the logic of increasing sanctions. I am frankly not against it, but I do not function under the illusion that sanctions will force the Iranians to adjust their strategy, or bring them to their knees.So why did the US decrease sanctions last year? There is no doubt sanctions have been effective. Yes, they can bring them to the table, but can they compel them to an agreement? The answer is no . This is because of the economy of resistance that Supreme Leader Ayatollah Ali Khamenei has created with the Iranian elites, who are getting rich off black market activities; and the Russians and Chinese, who provide a certain measure of protection for the Iranians.If you could buy your way out of this...maybe, but the nuclear program has become inextricably linked to Iran’s identity and is tied up with national pride, and they are not going to roll over.You wrote, “The nuclear issue has become part of Iran’s identity. Defying the West’s effort to restrict that enterprise has become a matter of national pride and dignity.” Since the current Iranian regime will never give up its nuclear aspirations and will remain a long-term threat to US security interests in the region, shouldn’t the US foreign policy goal be for regime change over time? Shouldn’t we ensure we don’t miss the next Green Movement opportunity for regime change? We are not good at regime change in modern times.You can change the regime by invading the country and putting in a puppet government. You could hope that a three- or four-month massive US air campaign against Iran’s nuclear and conventional weapons and economy may so unsettle the regime [and create] so much divisiveness that there could be a leadership change.Or you could do what has never worked: clandestine communication/PR strategy to look for groups in the country that want to overthrow the regime.That is only the beginning of the story. What will replace the current regime? The more our fingerprints are on this, the less leverage we seem to have, and the more blowback. Just look at Iraq and Afghanistan – we thought there was an end-game, but all we created were new perversions, the law of unintended consequences.Aren’t the Iranian people different than the Arabs, i.e. more pro-Western? Wouldn’t they be more willing, given the chance, to have a popular uprising against the regime? Maybe, but if the Arab Spring demonstrated anything, it was that even legitimate internal forces for change ended up leading to chaos or a return to authoritarianism.You overestimate our [US] competency: our will, our skill and the most important factor, that somehow this regime can be made to conform to external powers. This is a “great power fantasy.”It has been reported that the Saudis have been deliberately driving the price of oil down to weaken Iran. Do you believe this? It is possible.I think the Saudis are responding to what other producers are responding to: a recession, and the incredible rise of shale oil production. The Saudis are protecting market share.The Russians are more worried about Iranian production being back on line to stress their economy. Moscow may not be as enthusiastic about a nuclear deal if it allows a lot more Iranian oil on the market, which will weaken the Russian economy.Israel and the Palestinians American administrations have believed that the Israeli-Palestinian conflict is the ‘Gordian knot’ to untie for regional stability. Do you subscribe to that analysis?No, and it has not been that way for a long time. It is virtually impossible to look at this region and imagine any single key is going to open regional stability and prosperity – certainly not a localized conflict like that one.Solving the Syrian crisis – that would be extremely consequential.No one can seriously argue that the Israeli-Palestinian conflict has that sort of regional resonance. I know the argument; I have made it in the past. You have a region melting down, and no single fix is going to put Humpty Dumpty back together again.Is Palestinian Authority President Mahmoud Abbas capable of signing an end-of-conflict agreement that would resolve all outstanding issues, including Jerusalem and the right of return? He has incentive, but not the power. Bibi [Prime Minister Benjamin Netanyahu] has the power, but not the incentive. Neither is willing to pay the price of what would be required.When you say conflict and solution, you are saying something extraordinary.This would require a fundamental resolution of six core issues: (1) Jerusalem; (2) security; (3) refugees; (4) borders; (5) end-of-conflict agreement; (6) recognition of Israel as the nation-state of the Jewish people.Only a terminally obtuse person could believe this is possible.So why do we keep going back to the peace process? Nobody is prepared to call it over. The peace process is like rock and roll – it is never going to die.No one wants it to die; it is bad politics, it abandons hope and it can lead to violence.The peace process is doomed... suspended between a two-state solution we cannot achieve, and the idea of a two- state solution that is too important to abandon.That is where we have been operating for the last 15 years, unless some regional circumstance emerges that fundamentally changes the calculation of one or two of the regional parties – but I do not see that happening.There are three things you need to solve in the Israeli-Palestinian conflict: First, leaders who are masters of their political houses, not prisoners of their constituency; second, urgency that is so compelling it cannot be ignored; and third, an American administration that knows what it is doing, with the will and skill to reassure both sides.Does Israel have some international legal rights to territory over the Green Line? No. The American government will not accept it, nor will the international community. Resolution 242 seems to suggest... the problem of the territories is that they are occupied.Obviously, 242 did not say “the” territories, because it creates a measure of flexibility for retention of territory. Ariel Sharon’s 2004 letter from president George W. Bush [in the context of the roadmap and the prime minister’s disengagement plan] enlarged the area, and there are demographic and security issues. But the US will not change that this is “administered” territory.Let me ask you about the Jewish Nation-State bill. Do you believe the current debate within the Knesset about how Israel defines itself is much ado about nothing and in accordance with current basic laws, or do you see it as a potential infringement of Israel’s democratic character? Let me be clear: There are two realities that people do not want to accept.Whether this law is passed or not, it is not going to change these realities.Reality No. 1: Israel is a Jewish state.There may be a million-plus Palestinians who live there, but the state was not created for their benefit. The founders went to some lengths to create a set of aspirations that would characterize the state as a democratic polity, and treat everybody equally.Reality No. 2: You can accept it or not, but Israel is a preferential democracy.End of story. You can fight the concept of whether it is a Jewish state, with “Hatikva ” and service obligations. Yet the basic ethos of the state is oriented to Jews in practice, in the way state budgets are designed.You have a national minority and other countries have national minorities, but it must be remembered that Israel is surrounded by predatory neighbors and sitting upon a volcano. Israel as a Jewish state is how it was conceived.The fact is that the Palestinians and the Arabs have a hard time recognizing this, it is very hard for them. Since it is a preferential democracy, this law is in large part gratuitous; it certainly is not going to help or reconcile the contradiction between these two realities. It reinforces something that has been apparent to me for years.Who are we kidding? If Israel is not a Jewish state, what is it?In terms of the Washington-Jerusalem relationship: How much harm has the personal animosity between President Barack Obama and Netanyahu done to the short- and long- term health of this relationship? Short-term, it is a soap opera, a roller-coaster. Yet unlike Lehman Brothers, the US-Israel relationship is too big to fail; it is too intertwined with American politics.The more unstable the region, the more stable the US-Israel relationship will be.The behavior of Israel’s neighbors is always going to be profoundly worse than Israel’s, which draws a huge distinction in this country between Israelis and the rest of the region – which is a mess. When the image of Israel changes in America, then the relationship can change.That has not occurred in a profound way, but I am aware of it, and very conscious of it.■ The writer is the director of MEPIN, the Middle East Political and Information Network, a regional research analysis read by US congressmen, their foreign policy advisers, MKs, journalists and organizational leaders.