Israel Pressured by Obama's Tough Stance on Settlements

JERUSALEM, May 28, 2009— -- On the day Palestinian leader Mahmoud Abbas met with President Obama to promote the pan-Arab peace plan, Israelis are concerned over an apparent shift in policy toward them from their closest ally.

The Obama administration has signaled a tough new stance that is opposed to Israel's settlement building in the occupied West Bank.

The issue of the settlements as an impediment to a peace process was emphasized today by Palestinian leader Mahmoud Abbas when he visited Obama at the Whie House, one week after Israeli Prime Minister Binyamin Netanyahu came to Washington.

After the meeting with Abbas, Obama addressed reporters and called the United States a "stalwart ally" of Israel. But he also challenged the Israelis to stop settlement construction in the West Bank.

Sitting alongside the Palestinian president in the Oval Office, Obama said, "I think it's important not to assume the worst, but to assume the best."

Secretary of State Hillary Clinton could not have made it clearer when she responded to a question from ABC News at her press conference with the Egyptian foreign minister Wednesday:

"With respect to settlements, the president was very clear when Prime Minister Netanyahu was here," Clinton said. "He wants to see a stop to settlements -- not some settlements, not outposts, not natural growth exceptions. We think it is the best interests of the effort we are engaged in that settlement expansion cease."

Obama said Thursday that he was confident Israel would recognize that a two-state solution was in the interests of its security.

The issue, of what some estimate to be more than 100 unauthorized Israeli settlements, has been a chronic problem in regard to Mideast peace, and the Obama White House has signaled a tougher position than the Bush administration took toward settlements over the last eight years.

After returning from Washington last week, the Netanyahu government said it will deal with more than 20 illegal outposts, but is insisting on the right to build for "natural growth." It argues that growing families living in existing settlements must be allowed to build new homes.

"We want to move on the issue of illegal outposts because, first and foremost, it is an issue of law and order and it has to end," Israeli government spokesman Mark Regev told ABC News. "Our position on settlement expansion is that within existing communities there has to be normal life."

"Will we be able to continue building within the existing boundaries of an established settlement? We hope so," Regev added.

Netanyahu immediately felt pressure from his own Likud political party, and several senior colleagues expressed their anger at plans to evacuate outposts.

There are also dire warnings from militant Israelis in the West Bank about their determination to oppose the moves.

Nevertheless, the same uncompromising U.S. message was heard in London Tuesday during meetings between the Obama administration's special Mideast peace envoy George Mitchell and an Israeli delegation led by Minister Dan Meridor.

The U.S. team rejected appeals for natural growth, or "normal life" as some Israeli officials are now calling it, and were equally insistent that Israel start allowing reconstruction materials and higher volumes of basic supplies into the Hamas-run Gaza Strip.

An informal arrangement between the Bush administration and previous Israeli governments allowed for so-called natural growth, but discouraged large-scale land acquisitions outside the boundary lines of the established settlements.

How Can Netanyahu Proceed?

Under an agreement between the Bush administration and former Israeli Prime Minister Ariel Sharon, joint U.S.-Israeli teams tried to delineate those boundaries, which are rarely well-drawn, but the process got bogged down and eventually was abandoned.

One view is that the Obama administration is now insisting on a full settlement freeze from Israel to induce confidence-building gestures and steps toward normalization from the Palestinians and crucial neighboring Arab states.

It's far from clear that Netanyahu has the will or the political backing to deliver a full freeze.