On the two year anniversary of Operation Cast Lead, when Israeli troops fought Hamas on the streets of Gaza, the situation seems just as parlous.
Israel-Palestine: The implausibility of peace
When Barack Obama was preparing to take office in late 2008, Israel-Palestine was in shambles. Operation Cast Lead was in full swing. Israeli troops fought Hamas in the streets of Gaza, that conflict ending two days before Obama was sworn in as president.
Two years later, on the anniversary of that conflict, the situation appears just as parlous. Small militant groups in Gaza marked the anniversary of the conflict by firing mortars and rockets into southern Israel. Israel responded with airstrikes. There is little reason to believe that 2011 will improve the situation. None of the parties are in a position to negotiate for peace.
The US appears to have played its hand already. After trying and failing to force Israel to halt settlement construction in the West Bank and East Jerusalem, the US was forced to settle for a 10-month "freeze". Meanwhile, attempts to pressure Arab states into a goodwill gesture toward Israel to accompany the settlement freeze collapsed in the face of Israeli intransigence. When the 10 months ended, peace negotiations fell apart.
A string of diplomatic failures culminated in the US's offer of 20 next-generation fighter jets, worth $3 billion, and security guarantees for Israel in return for a three-month extension. Israel's rejection of the deal humiliated the US and all but destroyed hopes for renewed peace talks.
There was never much chance that the Israeli prime minister, Benjamin Netanyahu would agree to an indefinite halt to settlement construction. He loses nothing by stalling for time, and every time he thumbs his nose at Obama and the Arab world, he scores points within his fractious coalition of right-wing parties. And he does need to score points. Netanyahu is under fire from almost every direction in Israel.
The left suffered huge losses in the last election, but they lose no opportunity to snipe at Netanyahu for his troubled relationship with Israel's closest ally. The slightest provocation of the right sparks revolt: settlers clash with the police and the army and municipal leaders find any loophole they can to take the brakes off construction in the Occupied Territories. The main opposition party, Kadima, sits on its hands and hopes that in-fighting will destroy the coalition and catapult them back into government.
There is a temptation to cheer on the squabblers. The labour minister Benjamin Ben-Eliezer raised eyebrows on Sunday when he told the cabinet that peace talks must resume or the world might unequivocally recognise a Palestinian state. It was a nod to the Palestinians' PR campaign to build a worldwide consensus on their right to statehood.
Since the end of the settlement freeze, Palestinian diplomats have gained the support of South American nations for an independent Palestinian state within the 1967 borders. Norway elevated the status of Palestine's mission to just below that of an official embassy, and 10 other European nations are reportedly considering similar moves.
Mr Ben-Eliezer's statements are more political opportunism than a validation of the Palestinian Authority's PR blitz. The fact that the left appears increasingly uncomfortable aligning itself with a government which is both antithetical to its political beliefs and incapable of forging peace might tempt the Arab world to hope for a new government in the future. That would be a mistake.
Israeli politics has become a scramble for power, not peace. In the absence of US pressure, Israel appears content with the status quo. Meanwhile, America has ever fewer levers with which to limit Israel's expansionism. For now, the US's role in the peace process seems to be contracting, perhaps necessarily. Having spent so much political capital in futility, Obama must step back or risk losing what credibility he has left. Peace will have to wait.
While there is little risk that a new war in Gaza will erupt, the peace process is in a markedly worse state than when Obama took office. Direct talks have died prematurely, and even indirect talks seem unlikely. That does not bode well for 2011.