Israel wants a two state solution but wants to hold to some settlements, specially in East Jerusalem. That's what is problematic. The core issues have a solution, -all of them-. they have been outlined by the Clinton parameters, the Geneva Initiative, the Mitzna Plan, and countless other proposals. Only for Jerusalem, there are fourty different proposals. One of them must be acceptable to both sides, and it evetually will. Israel and the PA should sit down NOW and negotiate the core issues before statehood will be declared in september. It's better for all sides.
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Iraqi police fire tear gas as thousands of protests burst into Green Zone, storm Parliament (AP)
from the article: Palestinians to U.S.: Revive peace talks before we establish state