What Netanyahu said is basically along the lines drawn in the "Geneva Initiative" (including a call for a demilitarized Palestinian "state" and a recognition of Israel as a Jewish state). It is possible that he even had some ghost writers from these circles.
On the one hand, the whole present discussion about recognizing Israel as a Jewish state is of clearly a ruse by Netanyahu to impose impossible conditions on the Palestinians; but on the other hand that condition has been accepted for all practical purposes by all the Arab states that have signed peace treaties with Israel, and of course also by the PLO leadership.
It was a mine laid by all those who propagated a two-states "solution" for two peoples. It was also obvious to people like Uri Avnery and Prof. Shlomo Sand who propagate the vision of Israel as a state controlled by Jews.
No Arab leader can be really surprised by Netanyahu's position, which with very small stylistic modifications would could also have been signed by Meretz or "Peace Now". I heard back in 1988 a "Peace Now" leader, Mordechai Bar'on advocating for the "solution" of a demilitarized Palestinian "state" under practical Israeli control.
It is obvious that neither Netanyahu nor any Zionist "peacenik" can support a real independent Palestinian state alongside Israel. This means that even from a moderate Zionist view the proposed Palestinian state can be only a kind of a protectorate or a Bantustan.
The PLO leadership that signed the Oslo accords was aware of this Israeli position and at best tried to deceive itself and/or its supporters. Even the leader of the former Palestinian Communist Party, Mustafa Barghouti, declared in Zurich a few years ago that it is not realistic to expect Israel to recognize the right of return of the Palestinian refugees. He stated that he was nevertheless ready for an agreement with Israel (although he denied saying it later, there is a recording of his lecture and it was also repeated in an interview to the Swiss Tages-Anzeiger).
In the meantime the undeclared vision of the present Israeli elite (not only of Netanyahu) is actually for the expulsion of the Palestinians. These Israelis expect expect the Palestinian leadership to reject "peace" plans and sooner or later provide a pretext for further military escalation. Another round in Gaza, much more brutal than the last one, is just a matter of time. Such a pretext might be what is called in Israel "mega terrorist attack" (Mega Pigu'a), meaning a Palestinian attack that will cause the death of a large number of Jewish Israelis.
Already in 2000 a US expert close to the Israeli establishment, Anthony Cordesman said that although it is not moral, the Palestinian leadership has to accept the minimal Israeli offer or else…
Cordesmann wrote in October 2000:
Even if a peace settlement can now be reached in spite of the Israeli-Palestinian fighting
that began in September 2000, it will still leave major problems and the near certain threat of at least low-level continuing violence. Any compromise acceptable to both sides must leave
Jerusalem and the West Bank deeply divided. Much of the West Bank would remain under Israeli control and at least the greater Jerusalem area would remain open for Israeli settlement
No peace can meet the economic and political expectations of the younger Palestinians for years to come. (http://web.archive.org/web/20010915071815/http://www.csis.org/stratassessment/reports/IsraelPalestine.pdf)
Late though the hour may have been, the PA leadership should have dissolved itself and sought another strategy after reading that very realistic analysis.
As intensifying the armed struggle will most probably only provide the Israeli military and political leaderships with the desired pretext for mass-expulsion, all that remains is non-violent struggle for freedom and against racism and oppression. The dismantling of the PA and the Hamas regime could be an important step in the development of a realistic new strategy and create completely new dynamic. A parallel measure would be to open the PLO or a similar (but less corrupt) organization to Jewish citizens of Palestine.
Edited by George Malant