I'll start by noting that I don't think its great politics for the US to get involved directly with the Israeli-Palestinian conflict. There is no big payoff for the U.S. and we would get the majority of any ordinary benefit through normal trade and such.
There have been some diaries blaming the Israeli's occupation of Gaza and the West Bank for the current detente.
I'm of the opinion that the root cause of this very situation happened far earlier.
I'm not a neocon... quite the opposite, and generally think political settlements are preferable to military solutions in these such land disputes. I do, however think that Arabs, Hamas and the Palestinians hold a completely incompatible opening viewpoint of the whole situation.
Arabs deny Israel's right to exist right from the start
On May 14, 1948, one day before the end of the British Mandate of Palestine, Israel declared its independence and sovereignty on the portion partitioned by UNSCOP for the Jewish state. The next day, the Arab League reiterated officially their opposition to the "two-state solution" in a letter to the UN. That day, the armies of Egypt, Lebanon, Syria, Jordan, and Iraq invaded the territory partitioned for the Arab state, thus starting the 1948 Arab-Israeli War. The nascent Israeli Defense Force repulsed the Arab nations from part of the occupied territories, thus extending its borders beyond the original UNSCOP partition. By December 1948, Israel controlled most of the portion of Mandate Palestine west of the Jordan River. The remainder of the Mandate consisted of Jordan, the area that came to be called the West Bank (controlled by Jordan), and the Gaza Strip (controlled by Egypt). Prior to and during this conflict, 711,000 Palestinians Arabs fled their original lands to become Palestinian refugees, in part, due to an alleged promise from Arab leaders that they would be able to return when the war is won.
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Before the adoption by the United Nations of Resolution 181 in November 1947 and the declaration of the State of Israel in May 1948, several Arab countries adopted discriminatory measures against their local Jewish populations. There were riots in Yemen and Syria. In Libya, Jews were deprived of citizenship, and in Iraq, their property was seized. As a result, a large number of Jews were forced to emigrate from Arab lands, although many also emigrated for ideological reasons. Over 700,000 Jews emigrated to Israel between 1948 and 1952, with approximately 285,000 of them from Arab countries. Overall, about 850,000 Jews had left the Arab World by the early 1970s (according to official Arab documentation), with many of them leaving their property behind. Today, these displaced Jews and their descendants represent 41% of the total population of Israel.
Israel was born in the aftermath of war, and attacked by its neighbors from the start, as Arabs in the area hoped to eradicate the nation before it could take hold. Its population was drawn from largely Jewish emigres from intolerant Arabic neighbors.
These events forged a highly isolationist and defensive national psyche within Israel. These traits weren't a paranoid delusion. Arabs were actually determined to drive out the Israeli people.
An Incompatible Viewpoint
In the summer of 1967, Arab leaders met in Khartoum in response to the war, to discuss the Arab position toward Israel. They reached consensus that there should be no recognition, no peace and no negotiations with the State of Israel, the so-called "three no's".
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After the (Gazan) elections, in April, 2006, Hamas co-founder Mahmoud Al-Zahar did not rule out the possibility of accepting a temporary two-state solution, but also stated that he dreamed "of hanging a huge map of the world on the wall at my Gaza home which does not show Israel on it . . . . I hope that our dream to have our independent state on all historic Palestine (will materialize). . . . This dream will become real one day. I'm certain of this because there is no place for the state of Israel on this land".
From the start to the current day, both neighbors and elected Palestinians have refused to recognize Israel's very right to exist.
Surely there is moral ambiguity on both sides of this dispute.
Palestinians and the Arabic world try as they might through war and attack, haven't been able to remove Israel, and their demands for Israelis to withdraw from "Palestinian land", from a Hamas viewpoint are an ideological issue, requiring complete Islamic control of the area.
Israel isn't going anywhere
For the foreseeable future, Israel is going to exist in its current form. It has nuclear weaponry, very probably advanced long range nuclear weaponry, so the possibility of Arab neighbors unilaterally defeating the Israelis militarily has passed.
The internal Intifada of the Palestinians, largely at this point from Hamas has and continues to strengthen Israels resolve to resist and remain a whole state.
Surely, the conditions in the West Bank and Gaza has militarized Palestinians in a similar manner.
There are no easy answers, but surely demonizing one side of this conflict serves no purpose that I can discern.
To me, the conflict won't be resolvable, until the Palestinians stop allying themselves with an Islamic militant organization founded on the premise of eliminating Israel.