It's hard to know whether in our relations with the Palestinians we have reached a turning point of the kind that is termed "historic," but it's clear we're at a point where the sides have to take off their masks. A peace agreement is apparently closer than ever right now. The Arab states that are united in an anti-Iranian coalition want an agreement, as does Syria, which thirsts for the Golan Heights. The Palestinian leadership in the West Bank also wants an agreement; the secular Palestinian elite has apparently decided that an imperfect state right now is preferable to clinging to the dream of drowning the Jews in a flood of returning refugees in the future.

Thus the largest question mark hovers over the goals that the Israeli government and Israeli society have set for themselves. The number of answers to the question "what is Benjamin Netanyahu shooting for?" is equal to the number of people who speak with the prime minister. This fact suggests that the solution to the riddle will never be found behind closed doors; instead, it will arise in the noisy public square, where Netanyahu will have his back to the wall.

In the meantime, all the sane elements in Israeli politics must focus on taking down the obstacle that is so highly cherished by all the knights of the occupation: the claim that the dispute cannot be solved because the Palestinians seek to restore the situation in the country before 1948.

It is imperative that the Palestinian leadership and Israel's government begin direct negotiations immediately, accompanied by American and European pressure to ensure that the sides' national agendas are presented in public. The major issues are familiar: borders, Jerusalem and refugees. In the missile era, when the whole country is within range of the enemy's arms on all sides, local security arrangements of the sort Netanyahu loves such as holding on to the Jordan Valley are largely a pretext for killing time.

Beyond this, Israel's public must ask itself if it's legitimate to demand that the Palestinians engage in peace negotiations when next month the routine of land grabbing and settlement sprawl is destined to regain momentum. The worst mistake by Ehud Barak and his government 11 years ago was to proceed with negotiations when settlements were expanding and building was accelerated within them. That lesson must not be forgotten.

More than ever, a freeze on construction in the territories is a crucial prerequisite for progress in negotiations. With a chance to end a century of warfare staring him in the face, Netanyahu is worried about keeping his coalition together. This argument about coalition stability is so pathetic it says something about the lack of a genuine desire to reach an agreement.

If it turns out the government cannot hold together if it renews the settlement freeze, if it finally becomes clear that the settlers and the rest of the fanatics in the cabinet and Knesset are dictating the agenda, it will be best to put this government to rest. A prime minister can be replaced, if not in this Knesset, then in the next one. At any event, it's hard to imagine a government worse than the current one; it's a government whose legacy will include the selection of children of foreign workers for expulsion.

It could turn out that the next elections will usher in a yet more ultra-nationalist, clerical, fanatic and anti-democratic Knesset and government, but that result would have one advantage: It would make clear to everyone where we stand. Today more than ever the choice is clear. On the one hand, we can have a future of an apartheid-like state that is armed, "according to foreign sources," with Armageddon weaponry, while continuing on the path of a binational state steeped constantly in blood. Or we can have two states configured along the 1967 borders, with equitable land swaps. No other solution is viable.