The Obama Administration is making a mistake forcing Israel and the Palestinian Authority to discuss "core" issues such as Jerusalem, refugees, borders and settlements when the two sides are crying out that the gap between them on these explosive topics remains as wide as ever.

There is no doubt that the talks will fail. Mahmoud Abbas and Fayyad will be the first to pay the price because Palestinians will turn to them and demand that they stop talking about peace and coexistence with Israel. The only ones who will benefit from this are Hamas and its friends in Tehran and Damascus. The "proximity talks" will eventually undermine the moderates and boost the extremists among the Palestinians.

By insisting on putting the issues of Jerusalem and refugees on the table, the Obama Administration is placing Israelis and Palestinians on the course of collision.

As was the case on the eve of the Camp David parley, the "proximity" talks follow a period of relative calm and as the economy in the West Bank seems to be improving in a remarkable fashion. Israel and Hamas seem to have reached some kind of an unofficial cease-fire that has resulted in less violence and casualties over the past year. In the West Bank, on the other hand, security coordination between the Palestinian and Authority and Israel is one of the reasons why the suicide bombings have stopped.

Moreover, the Americans and Europeans are continuing to pour billions of dollars on the West Bank government of Prime Minister Salam Fayyad - a move that has led to a significant improvement of living standards in this area.

Yet these achievements on the security and economic fronts seem to be at risk now that the "peace process" is being revived. Sooner or later, Israel and the Palestinians will be trading allegations over which party is to blame for the failure of the "proximity" talks.

On the eve of the last summit, many Palestinians and Israelis were convinced that the two sides were closer than ever to reaching an agreement that would put an end to the conflict for once and for all. But the higher the expectations, the greater the disappointment was- especially among the Palestinians, who later vented out their anger and frustration against Israel.

The last time these issues were put on the table was at the Camp David summit in the summer of 2000, when former President Bill Clinton did almost everything he could to force Ehud Barak and Yasser Arafat to reach an agreement. The failure of the Camp David summit only increased tensions between Israel and the Palestinians, with each side blaming the other for foiling the "peace process." These tensions reached their peak in September that same year with the eruption of the second intifada.

Ironically, things seemed to be moving in the right direction just before the botched Camp David summit. True, it was not an ideal situation, but at least there was less violence and many Palestinians could still move between the West Bank and Gaza Strip and go to work in Israel. Back then, there were indications that the Palestinian economy was finally beginning to improve.

But tensions erupted as soon as President Clinton forced Arafat and Barak to start talking about the "core" issues, particularly the future status of Jerusalem and its holy sites. Arafat did not want to go down in history as the Arab and Muslim leader who gave up parts of Jerusalem to the Jews. On the contrary, he had always sought to depict himself as the modern Salah Eddin Al-Ayoubi, the Muslim warrior who drove the Crusaders out of the Holy Land.

Similarly, Arafat did not want future generations of Arabs and Muslims to condemn him for relinquishing the "right of return" of Palestinian refugees to their original villages inside Israel.

In short, a beleaguered Arafat was back then trying to explain to President Clinton that he did not feel that he had a mandate to make real concessions on Jerusalem and the refugees.

Arafat returned home from Camp David with the message that Israel does not want peace because of its refusal to withdraw to the pre-1967 borders and the Palestinians' other demands, first and foremost the "right of return."

Now President Obama is repeating the same mistake. The "core" issues of Jerusalem, refugees, settlements and borders are once again on the table - this time at the US-sponsored "proximity" talks between Israel and the Palestinians.

For the talks to succeed, both sides need to make concessions not only on Jerusalem and the refugees, but also on a variety of sensitive topics. As it appears now, neither Abbas nor Binyamin Netanyahu is in a position to make far-reaching concessions.

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