I dislike the notion of a "Jewish State", "Muslim state", "German state", "French state", etc. However, as a practical matter, the Palestinians should recognize that Israel is the nation-state of the Jewish Peoples so long as Israel establishes a constitution which specifically recognizes that Palestinians will be treated equally under the laws of Israel as jews. [As jews have the right to "return" to Israel, so too should Palestinians under the Constitution.] Palestinians should take the moral high ground (for once) and leave the practical problems to Israel.
Donald Trump: Israeli settlement construction in West Bank should 'keep going' (Haaretz)
from the article: Netanyahu: No peace until Palestinians accept Israel as Jewish state