After the strong beginnings of 2009, during the Obama administration’s first days in office, 2010 began on a cautious note on the Palestinian cause. There were some promising signs: the Israeli government partially froze its settlement activities; indirect talks commenced and there was hope that in one crucial area all seemed all in agreement, the need to delineate the borders of the future Palestinian state. Such agreement would have allowed negotiators to be relieved of the weight of settlement activities. After seeing settlers nearly triple in the 18 years since the beginning of the Oslo process, the Palestinians were no longer willing to belittle the need for the suspension of settlement activities. Israelis, the theory went, also needed the border issue settled so as not to have to keep worrying about the pressure of continuously being asked to suspend settlements. But the issue turned sour. The Netanyahu government proved that it was run by pro-settlement ministers and the Labour Party proved that it wanted to stay in power more than it wanted peace. And the US failed to “make” Israel do the right thing. Washington fell in the “appeasement” trap. Former US ambassador to Israel and Egypt, Dan Kurtzer, called the US offer suggested by Dennis Ross a mistake. Kurtzer, who was an Obama adviser during the elections, said it was a mistake to offer Israel what he called a bribe for a mere three-month suspension of settlement activities. In detailing his position, he said that offering Israel $3 billion worth of fighter jets, acceptance of Israel’s position on the security of the Jordan Valley and a promise to veto any resolution calling for a Palestinian state amounted to “haggling”. The worst part in the American offer to Israel was that there was no clear punishment if the latter failed to adhere to international law. This became evident when the US publicly chastised a number of Latin American countries that recognised the state of Palestine on the 1967 borders. The location of the borders was one of the areas that were talked about between Palestinian and American officials. If the Americans had been neutral in the conflict, they would have presented their position on the border dispute, thus making it clear where Israel and Palestine will be. In a speech that appeared to reflect America’s liking its wounds and accepting some sort of defeat of its efforts, US Secretary of State Hillary Clinton claimed that her country planned to present “bridging” proposals once the two parties fail to reach agreement (through indirect talks) on different issues. Of course Washington failed to say it will abandon the peace process, knowing very well that Israel and its supporters in the US will not allow it to let Israel fight its battles alone. And to make matters clear, a majority in the US Congress reiterated an earlier position demanding a US veto in case of a unilateral Palestinian declaration of a state. The above failures, however, did not distract one person from carrying out his activities. Palestinian Prime Minister Salam Fayyad, who has been on a two-year mission, to as he calls it, to accomplish statehood and not declare a state, is cognisant of the restraints on the White House and trying to create a de facto state of Palestine that is based on institutions, and the rule of law. His efforts have won him praise from friends and foes alike, and his determination to go on with the effort of building up a state rather than continuously curse the occupation has been rewarded politically and financially. Not only did Latin American countries reverse earlier positions and recognised Palestine, but a number of European countries have or are planning to raise the diplomatic status of the Palestinian missions there. Palestinian statehood, set to materialise at the end of August 2011, according to the Fayyad plan, faces some huge obstacles. The division of Gaza and the West Bank looms large and not only affects internal cohesion but also has a bearing on inter-Arab relations, which is crucial for any success in gathering international support. The potential for 2011 to become a turning point in the Palestinian-Israeli conflict depends in large part on what happens in Washington and Tel Aviv. There is a limit to what Palestinians can do on their own. The Obama administration has the better part of this year to show resolve in pursuing this conflict before becoming consumed with the 2012 reelection campaign. The Israeli public needs to feel enough pressure so as to make the needed coalition changes or hold elections. Even then, it is not clear that the rightwing, racist slide that Israel is undergoing will soon see a reversal. Finally, while the political situation for the Palestinians is steadily improving, this can be easily shattered by one mistake by a militant thinking he knows best. As we approach the Palestinian self-declared date for preparing for statehood, all effort should be focused on keeping the people and the areas united in purpose and will.