The US is to pro-Israel to be a promoter of a just peace. Nethanyahu has said that the status of Jerusalem is not negotiable so there is no basis for peace talks. But the Palestinians must go through the motions to keep world opinion on their side. There best and probably only chance is to unilaterally declare a state in 8/2011 and take their case to the UN. The record of failed peace negotiations will work to their advantage.
from the article: Obama to Abbas: I am committed to creation of Palestinian state