In contrast to my rather gloomy assessment of the Obama administration's prospects in the Middle East, Israel's prospects look rather good. This is granted, of course, that the chances for any formal peace (note the word "formal") with the Arab states or the Palestinians are close to zero. In addition, there are two longer-term threats in the form of Iranian nuclear weapons and Islamists one day taking over one or more Arab states. But let's enjoy ourselves while we can. It's also important to remember in the Middle East, optimism does not mean forecasting blue skies but merely ones only lightly overcast. It's funny, though, how much better Israel's situation is than is generally perceived. Consider the pluses: â€¢ The potential of a clash with the US has been averted, most likely for the remainder of President Barack Obama's term. All the lessons received by the US in the region - to whatever extent it learned them - are favorable to Israel, showing how ready Israel is to help US efforts, at the same time as demonstrating how hard it is to get peace and how limited the other side's cooperation is. The possibility of US rapprochement with Iran or Syria has been destroyed by the latter. â€¢ On the surface the situation with Israel looks dreadful, but where it counts the support is sufficient. France, Germany and Italy have friendly governments, while in Britain an acceptably positive regime is about to be replaced by a warmer one. (It helps to have low expectations.) â€¢ Despite their rhetoric, Palestinian Authority leaders are basically satisfied with the status quo. Their strategies for forcing more concessions from Israel without giving anything leave them smug but without prospects for success. The danger of a Hamas takeover has been averted. The economic situation in the West Bank is about as good as it's ever been. And the PA rulers prefer to avoid renewed violence. That's not nirvana but it ain't bad either. â€¢ Hizbullah doesn't want renewed war this year, seeking to carry out revenge terrorist attacks away from the Lebanon-Israel border. Hamas is probably cowed enough by the early 2009 fighting (outside observers still don't realize the extent to which its gunmen broke, ran away and hid behind civilians, but the Hamas leadership knows), though we can't be certain. â€¢ While the international economic slump has hit Israel, the country has been more insulated from its negative effects than one might have dared hope. Its remarkable technical innovation in hi-tech, science, medical and agricultural technology continues to make rapid progress. â€¢ Israel has a government with a high level of popular support, which really seems - after so much ineptness and ingenious plans that didn't do much good - to be on track. There is, by Israeli standards, a high degree of national consensus. â€¢ Iran still doesn't have nuclear weapons. THAT'S NOT at all a bad list. There are many who think that Israel cannot flourish, perhaps cannot even survive, without having formal peace with the Palestinians or with Syria and the Arabic-speaking world in general. This is simply untrue. The lack of a signed peace treaty with everyone (not to mention that such documents exist with Egypt and Jordan) is not the same as war. From the usual standards of no war, no peace, this is a pretty good one. Of course, there are negatives, yet they really don't amount to anywhere near as much as it seems at first glance. The virtual defection of Turkey's regime from the Western alliance (yes, it really is that bad) and the end of the special relationship between Jerusalem and Ankara is a bad thing. But the Turkish semi-Islamist rulers are restrained by their desire to play a role in regional peacemaking and not to make the Americans or Europeans too angry. Most distressing of all is the noise. The virulent hatred of Israel in large sections of the American and especially European intelligentsia, which goes along with the endless outpouring of academic, media and EU sniping, can be dispiriting. Yet even here, there is some silver lining. The more extreme and outright crackpot the attacks, the less credible they are. Public opinion polls, especially in the US, are not so bad. What's most important is this: A willingness to assess your problems accurately, guided by reasonable expectations. Not being crippled with ideology, blinded by misconceptions, swayed by bad international advice and the desire to be popular. And with determination and courage to implement policies that do the best with the hand you've been dealt. If only others were doing the same thing, the world - and especially the Middle East - would be a better and more peaceful place. Unfortunately, prospects for US policy in the region are considerably less rosy. The Obama administration's first problem is that it has literally no way forward on what is over-optimistically called the Israel-Palestinian "peace process," since it isn't going to put real pressure on the PA to negotiate. Nothing may happen before Israel ends its 10-month construction freeze next September. So the US government will pretend to work hard, send envoys zipping around, peering for some opening to leap into action. But this charade should be pretty transparent. Then there's Iran. Originally, the administration was going to increase sanctions in September. That was moved back to the end of December. Now it is too late to meet that deadline. At best, we are going to see negotiations in January and maybe - maybe - increased sanctions in February. But who knows? That's not all. The administration keeps pretending it has China and Russia on board for sanctions. This is just untrue and will soon become obvious. Either there will be no sanctions, ridiculously weak sanctions or more serious sanctions without these two. Once again, there is no easy way out for the administration from looking like a failure. And by the end of next year or earlier, it will be clear that any sanctions applied aren't working. The year 2010 is the make or break year for stopping Iran. Not hard to guess which it will be if current trends continue. The world needs the US leadership to learn a great deal real fast. Let's hope that happens in the year to come.