24/10/2011 18:11 BST | Updated 24/12/2011 05:12 GMT

Israel/Palestine - Forget the Last Two Years

No doubt the negotiated release of Gilad Shalit after five years in captivity will end up lost in the furore surrounding the death of Muammar Gaddafi, but in many ways it has more potential to affect the future of the Middle East than the sorry end to the erstwhile dictator's life.

Gilad Shalit's captivity has long been a sticking point for negotiations between Israel and Palestine and to a certain extent was emblematic of the Palestinian position in the peace process as a whole. Shalit had become more than just a political prisoner, he was a powerful bargaining chip for Hamas. The issue offered Hamas the chance not only to secure the release of high-ranking prisoners of their own, but also to show that it could act as a meaningful negotiating partner.

I cannot help but think back to the summer of 2009 when I felt a lot more optimistic about the direction Israel/Palestine relations were taking. A deal for the release of Shalit seemed imminent, Fatah and Hamas were on the verge of signing a reconciliation deal and Salam Fayyad's statebuilding plan was gathering momentum.

At that point it looked as if enough political space could be maintained to start moving forward with a peace process that had ostensibly been stalled since Annapolis. Then two things happened to stop that. Firstly the Goldstone report came out, and then the United States completely bungled its response to the report and the ensuing hostile response from the Israeli government.

In 2009 the Goldstone report came out with a damning indictment of Israeli tactics during Operation Cast Lead. Critics of the report argued that it did not condemn Hamas' tactics enough (operating in civilian areas and near UN compounds etc.) while proponents argued its assessment of Israeli tactics (destruction of schools, houses and use of white phosphorous) necessitated some form of international sanctions.

Regardless of what your assessment as to the veracity of the report was, at the time it left Mahmoud Abbas in a very difficult situation. The Obama administration stayed silent, with Abbas unsure whether to support the report (and risk torpedoing talks with Israel on the eve of a proposed meet in New York) or come out against the report and lose what remained of his credibility with the Palestinian Authority and Fatah. He chose the latter course and immediately faced calls for his resignation. Israel could continue to disavow the report and blow off the New York meeting - all while the US remained silent, seemingly indicating tacit support. Suddenly talks of a complete settlement freeze became talks of a limited six-month moratorium and once again talks ground to a halt before they had really restarted.

All this is to say that prior to the disastrous handling of the Goldstone report, conditions existed where real progress could have been possible - Fatah/Hamas reconciliation, Fayyad's plan to create a viable Palestinian state and the momentum provided by the negotiated release of Shalit. Here is where I step off the beaten path.

During the Cuban missile crisis there came a point where Kennedy and his team had to show faith in Kruschev regardless of the bellicosity of those in his cabinet. When late in the game Kruschev himself sent word of a possible deal to Kennedy, it was quickly followed by a second letter from Soviet hardliners in his cabinet demanding further concessions from the US (removal of the Jupiter missiles in Turkey). Bobby Kennedy counselled his brother to ignore the second letter and respond only to the favourable terms laid out in Kruschev's earlier communiqué. He took that advice, and we know how that decision played out.

What I am proposing is something not dissimilar. US policy on Israel/Palestine has been at best shambolic for the last two years, I'm suggesting it is time to forget everything that has happened during that period. The same positive conditions that existed in 2009 exist now - Shalit's release, Fatah/Hamas reconciliation and the Fayyad plan. What is needed now is a radical realignment of how the US and rest of the Quartet treat the negotiating parties.

To make a breakthrough in negotiations there comes a point where a radical change has to come - and in this case that is the decision to treat Hamas as a legitimate negotiating partner. Of course Hamas need to amend their charter to recognize Israel's right to exist, that is unequivocal, but the IRA didn't exactly become whiter than white before they were taken seriously in negotiations. Refusing to talk to them has gotten us nowhere and so, distasteful as it is, they have to be included in negotiations despite the reprehensible demands in their current charter.

By the same token a complete freeze of settlements should be a prerequisite demanded by the Quartet prior to restarting meaningful talks. The United States needs to show some boldness and demand more from its ally Israel by considering steps such as threatening to withhold military aid. Creating facts on the ground now is simply creating problems for later, as even a Palestinian state based on 1967 borders would be far from contiguous at this point.

Egypt has shown that even following Mubarak's departure it could help rather than hinder the Shalit release negotiations, and similar faith much be placed in its ability to secure any eventual border with a Palestinian state. Fayyad's plan could be resurrected, but a huge part of the prospects for its success would be to convince Israel that Palestine can police its own borders and ensure Israel does not come under attack.

Negotiators like Saeb Erekat have to seize the tiny opportunity for progress now, as history shows that windows of opportunity in Israel/Palestine talks do not last long. Instead of trying to recycle George Mitchell's success in Northern Ireland the Obama administration should appoint someone with the potential to become the next George Mitchell. On the other hand, Obama could take a leaf out of President Carter's book and give the negotiations the personal touch they clearly require - if he truly wants to become the statesman he seems to aspire to be. All of the players in this game know what a final negotiated settlement would look like (status of Jerusalem, token right of return, land swaps). It is time to accept that neither side will be fully satisfied with the end result but that any settlement now is better than what has existed for the past 64 years.

If Obama wants his Nobel piece prize to become more than a million dollar mantelpiece ornament, he should show leadership like the Kennedys, and become a transformative leader rather than simply a reactionary one. Forget the last two years, it is time to start thinking about where we want to be two years from now.