I think what happened is that Mr. Natanyahu has played some kind of Russian Roulette. Had Mr. Biden and he US swallowed the Israeli decision, Jerusalem would have been overflown with jewish settlements. But, for sake of peace and both peoples , Natanyahu's maneuver did backfire.
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Alleged assailant behind officer's stabbing in north to remain in custody for 4 more days (Haaretz)
from the article: East Jerusalem plan was supposed to be shelved, so what happened?