I agree with you. But netanyahu, who at times past, may have seemed more pragmatic, has a different public in Israel, one more in line with his thinking. And he has a different public in Washington, who is simply fed up with his swagger and arrogance. But change course at this point? I suggest you look at what occured yesterday in Yizhar. That is just a small dose of what would happen on a larger scale if any concerted movement by the government were taken against this element in Israel that now calls the shots. They are violent, scornful of democratic process and increasingly alienated from any chance for peace. They believe the "enemy" is not one that can be turned into a friend through compromise. It is an existential enemy for them. netanyahu knows well that if he moves against this population it will bring about an unravelling of the social fabric and cause a Jewish intifada.
Donald Trump: Israeli settlement construction in West Bank should 'keep going' (Haaretz)
from the article: Indyk: If Israel manages alone, it can decide alone