Greg Sheridan, writing in the Australian, separates the wheat from the chaff and neatly summarizes why there has been no peace between Israel and the Palestinians: http://www.theaustralian.news.com.au/story/0,25197,23337782-7583,00.html.
While he is fairly detailed, Sheridan does miss one central point, which is that there can never be peace where one side does not even acknowledge the other's right to exist. Until the Palestinians accept that Israel is not going to simply disappear (this qualification is subject to revision when Iran finally gets its nuclear bomb), a day I don't believe will ever occur, there cannot be peace. It's that simple.
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