When it comes to America's foreign policy and diplomacy, the significance of the Gaza conflict is clear. The disintegration of Hamas-run Gaza represents the final step in the demise of the Oslo two-state paradigm. On the question of what role the United States should play moving forward, the path is also clear, but it will require the new administration, and the foreign policy establishment, to shed its fixation with the stagnant two-state model and work toward a regional solution that would lead to a more promising and secure future for Palestinians and Israelis. The background to the current fighting illustrates the failure of the Oslo paradigm. Founded to destroy the entire State of Israel through "a great and serious struggle against the Jews," Hamas has implemented its goals through a policy of wholesale slaughter of innocent Israeli civilians. In 2001, Hamas began launching rockets into southern Israel, only seven months after former prime minister Ehud Barak offered Yasser Arafat a state on 98 percent of the land sought by Palestinians for that purpose. Rather than pacifying the Palestinians, Israel's territorial overtures sparked a second intifada led by the Palestinian Authority itself, killing and wounding thousands of innocent people. NONETHELESS, ISRAEL pushed ahead with the two-state formula, seeking to alleviate conditions that Palestinians were using to justify their violence. In 2005, Israel fully evacuated its military presence in Gaza, and forcibly removed all Jewish presence from there as well. But the gesture backfired again, driving more Palestinians into the ranks of radical groups like Hamas, culminating with Hamas's takeover of Gaza in 2006, after it easily brushed aside the feckless Fatah forces under Palestinian Authority President Mahmoud Abbas. With territory of its own, and no credible Palestinian opposition, Hamas ramped up its rocket and mortar attacks against Israeli towns and villages. All of southern Israel's citizens - Jewish and Arab - lived in constant state of terror, with many killed and wounded. An Egyptian brokered cease-fire this year only led to Israel watching as Hamas armed itself with longer-range and more deadly projectile weapons, while the Abbas-led Palestinian Authority remained holed up in Ramallah, unable or unwilling to do anything about it all. No doubt, President-elect Barack Obama's foreign policy advisers are in the midst of evaluating US Middle East policy and planning for the new administration. The key question for the president will be whether to resuscitate the two-state proposal and ask Israel to entrust more land in the hands of the PA. His conclusion should be the same as that of a trauma doctor facing a painful reality: that after administering many defibrillations - Wye River, Camp David II, the road map and Annapolis - the two-state plan, based on land for peace, has flat-lined. Territorial concessions made directly to the Palestinians augment, rather than diminish, the zeal for violence against Israel. Were Israel to apply this concept to the West Bank, few doubt that the area would swiftly transform into an armed and radicalized entity identical to Gaza. Such an outcome would greatly undermine not only the security of Israel and Jordan, but also of the United States. HOWEVER, THE failure of the two-state plan does not leave the new president without options. Doing away with a plan that has crumbled away over 15 years opens a rare opportunity for Middle East experts and diplomats to get back to the fundamental question of how best to fulfill Palestinians' political and economic aspirations while improving security for Israel. At a moment of uncertainty in the Middle East, as well as one of transition in American politics, we should be encouraging creative thinking in foreign policy rather than continuing to resurrect a stagnant proposal. One important idea that merits attention is to shift our policy to one that expects, perhaps even requires, both Jordanian and Egyptian participation in shaping the future of the territories they border. Doing so would inject a new sense of trust and responsibility among all the stakeholders of this conflict. It would also stimulate discussion of more viable political arrangements, such as Palestinian federation or confederation. These proposals - not entirely new, but also not vigorously debated by our foreign policy establishment - could yield far greater political and economic returns for Palestinians than the two-state proposal has achieved after 15 years and billions of dollars spent. WHY WOULD Jordan and Egypt get involved? First, both countries have grave interests at stake in the future of the West Bank and Gaza, most significantly to halt the spread of Iranian-backed extremism in their backyards. On this issue, the question has never been if Egypt and Jordan were going to insert themselves, only when. Second, to the extent that Egypt and Jordan can provide security guarantees where the Palestinians cannot, the process would provide reassurance to otherwise skeptical Israeli security officials. As such, increased Jordanian and Egyptian roles and responsibilities in the territories should be made a key component of our Middle East policy. Opponents of this idea argue that the regional approach denies Palestinians the right to self-determination. Not so. Polling indicates that a growing number of Palestinians - including several high-ranking PA officials - support the idea of confederation over independence. This makes sense if one considers that the only accomplishment of the PA has been an increase in poverty, violence, corruption and despair. On top of that, the yawning political gap between Gaza and the West Bank has stimulated a cultural schism that undermines the viability of united statehood. Simply put, Palestinians in search of a better life view the idea of an independent Palestine as increasingly less appealing and less viable. In truth, the obstacle to pursuing such a plan comes not from the Palestinians, the Egyptians or the Jordanians, but from our own foreign policy establishment, which has sunk enormous resources into the two-state plan and hesitates to walk away. But the cause of peace requires an honest assessment of what has worked and what has not. The time has come to cut our losses on a failed experiment and pursue regional solutions that will lead to peace and prosperity in a troubled region. The writer is a Republican US senator from Kansas.