Recommended: The Real Story of How Israel Was Created by Alison Weir
It's important to understand this history, so obscured by political rhetoric and mythmakers. But, however flawed the creation, the state exists and is home to nearly 8 million people, of whom nearly 6 million (according to the Israeli census) are "Jewish" — by religion? by tradition? by ancestry? By any or all these criteria, apparently (which inflates the numbers). The occupied Palestinian territories have about 3.5 million people, including Muslims, Christians and atheists, not counting the many Jews (by any of the usual criteria) who have settled there illegally.
To my mind, the only acceptable way to solve the Israeli-Palestinian conflict is to dissolve the partition, that is, re-unite it all as a single state, with the same guaranteed rights for everybody regardless of family mythology, competitive tales of suffering, or whatever religion people profess or abjure. In other words, make it a normal modern state. Jews have as much right to live there as anybody, and no more right than anybody. It would cease to be a "Jewish" state and be simply a state with (probably for a long time) a "Jewish" majority. Until such a solution, the situation there will remain unstable and a continuing provocation to regional violence because the present condition is simply unacceptable to the non-Jews.
So how will the impasse between Palestinians and Jewish Israelis be broken? Not if it is left to those two parties, already locked in self-nourishing cycles of hate and fear. If a solution is not imposed by pressure from other states (extremely unlikely, given current US politics and the uselessness of Tony Blair), it must come from a wider change of the global context. The most important change will be if the peoples of Egypt and other Muslim-majority countries can achieve and consolidate their own democracies and themselves become normal modern states, with rights for all creeds. Such a revolution would immediately deflate Jewish Israeli paranoid chauvinism and leave people like Netanyahu and Lieberman without a constituency to play to. It would also force serious realignment and rethinking of Hamas and the PLO, and the Arabs and Jews of Israel-Palestine would again be able to talk to each and work things out, as they were beginning to do back in the early 1990s, before Rabin was assassinated (1995).
So, for the sake of Israelis, Palestinians and all the rest of us, we are obliged to do whatever we can to encourage democratization of Arab and other Muslim countries.