There is not enough land in the present Israeli borders to give Palestinians and Israelis the state each of them rightly deserve. If I’m a Palestinian, and you give me the West Bank and Gaza, I’m thinking I just got a pretty bad deal since I’m only getting 22% of historic Palestine. If I’m an Israeli, and you give the Palestinians the West Bank and Gaza, I’m thinking you just left my biggest population centers with a border that’s roughly 10 miles wide between the Mediterranean and the Palestinian state, and I’m completely exposed to attack. So, a Palestinian state in the West Bank and Gaza is a bad deal for Palestinians and Israelis. That’s why this conflict has been going on forever. The solution the international community has been advocating is unappealing to both of the principal actors. So, all reasonable people can agree the Palestinians need to have a state of their own, but it needs to have borders that both Palestinians and Israelis are satisfied with. The Palestinian state should include some territory from the West Bank, Gaza and partly from neigboring countries to make it a viable state. Israel simply doesn’t have enough land with which you can carve out a viable Israeli state and Palestinian state.
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from the article: Netanyahu tells Obama: Israel cannot go back to the 1967 borders