Extremists push Israelis and Palestinians closer together

The Israeli-Palestinian conflict is a stand-off. The Palestinian Authority president Mahmoud Abbas and the Israeli prime minister Benjamin Netanyahu are refusing to budge on the issue of settlements. Mr Abbas will not start proximity talks until the Israelis stop building on land meant to be part of a future Palestine. The Israelis insist the Palestinians start talks without any conditions.

It is difficult to see how the stalemate will be broken. The general mood among Palestinians is bleak. The prospect of East Jerusalem as the capital of their future state is fading fast as settlements, many of which are funded by wealthy Jewish-American investors, continue to encroach on Arab neighbourhoods. "Lies and propaganda," is how one Palestinian businessman described the possibility of independent statehood. In the Islamic quarter of the old city, home to important Muslim and Christian sites, there are a growing number of Israeli flags.

In Beit Hanina, a suburb north of Jerusalem, I met Mohammed Dajani, a professor at Al Quds University. He took me to the Israeli military checkpoint near his house, built on land which belonged to his family. He had a different take on the situation. Mr Netanyahu's far right coalition would expose Israeli intentions for what they were. "The radicals among us turned international public opinion against Palestinians," he said, referring to suicide bombers. "Everyone thought all of us were extremists. Their radicals are doing the same thing to them. It is better to have the right-wing Orthodox parties than the beautiful face of Tzipi Livni, which says 'we are nice'."

It is perhaps important to point out that Israeli public opinion is not uniformly against Palestinians and Arabs.The mood of Israelis seems to fall into two camps: belligerence (the Americans cannot push Israel around) and alarm (Israel risks losing its most important ally for the sake of a bunch of right-wing politicians). "We don't tell the Britons what to do in London or the French what to do in Paris and we don't expect our friends to tell us what to do in Jerusalem," said the national infrastructure minister, Uzi Landau, who accompanied Mr Netanyahu on his disastrous trip to Washington last week.

But the more realistic crowd has a different assessment. Opposite the Menachem Begin museum in West Jerusalem is a trendy cafe popular with Israeli families and young people. The cafe, attached to a film theatre, in a way represents what Israel aspires to be: secular with a Jewish majority. The realists understand that a two-state solution is the only way to ensure this happens. I met an Israeli politician for a cup of tea one afternoon at this cafe. She said that Mr Netanyahu had been surprised at the intensity of American pressure over settlements.

"The US is testing Netanyahu and putting him in a corner," she said. "It is a risky strategy because pushed too far, two things could happen. "Israeli public opinion rallies around him for reasons of patriotism and, two, the Palestinians harden their position. You are already seeing some of that." But she was fairly optimistic a solution would happen eventually. "The parameters have been around for years. When it happens, it will happen very quickly."

Jerusalem is a tense and fractured city. Secular versus Orthodox, Jews versus Arabs; the holy city's neighbourhoods seem bitterly divided. The anger and resentment runs so deep it is difficult to see how Jerusalem could ever function normally. Outside my hotel near the old city one morning I tried to flag a taxi to Sheikh Jarrah, an East Jerusalem neighbourhood where tensions are running high.

The first driver, hanging around on the street opposite a hotel popular with Jewish tourists, just shook his head. "I don't go to Sheikh Jarrah." There were no other customers around. But he would rather not earn the money than have to travel to an Arab area. It took three tries before I persuaded someone. He was Arab. [e-mail]