It can no longer be said that the United States cannot want peace more than the Israelis or Palestinians.

Israeli settlements in the Occupied Palestinian Territory, which encompasses under international law, East Jerusalem, the area in the West Bank that Israel annexed to Jerusalem, and the West Bank, pose a security threat to the United States. Settlements are the existential challenge to creating an independent and viable Palestinian state and the major barrier to resolving the Israeli-Palestinian conflict on the basis of a two-state solution. As the Iraq Study Group noted, because “all key issues in the Middle East—the Arab-Israeli conflict, Iraq, Iran, the need for political and economic reforms, and extremism and terrorism—are inextricably linked…The United States cannot achieve its goals in the Middle East unless it deals directly with the Arab-Israeli conflict…” To achieve its goals, which are ensuring the uninterrupted flow of oil into the world economy, promoting its missions in Iraq and Afghanistan, and preventing nuclear proliferation, the United States needs the support and cooperation of the states in the area. This support, however, is made more difficult because the heart of the Arab-Israeli conflict, the Israeli-Palestinian conflict, is unresolved. As General David Petraeus said on April 1, 2009, and reiterated on March 16, 2010 before the Senate Armed Services Committee, the continuation of the conflict “presents distinct challenges to our ability to advance our interests in the AOR (Area of Responsibility). Israeli-Palestinian tensions often flare into violence and large-scale armed confrontations. The conflict has created a deep reservoir of anti-American sentiment, based on the perception of US favoritism for Israel. Arab anger over the Palestinian question limits the strength and depth of US partnerships with governments and peoples in the AOR and threatens the continued viability of moderate regimes in the Arab world. Extremist groups exploit that anger to mobilize support. The conflict also gives Iran influence in the Arab world through its clients, Lebanese Hizballah and Hamas.” Former UN Ambassador Bill Richardson reinforced what General Petraeus said when he told CNN on September 24, 2009: “Ending the Israeli-Arab conflict…will provide the United States with a much better environment to advance its diplomatic efforts vis-ŕ-vis Iran…The comprehensive peace agreement that Obama, Secretary of State Hillary Clinton and special envoy George Mitchell are all working toward effectively takes away Iran's role as the champion of the Palestinians a significant distraction to our real interests when dealing with Iran.”

In his statement to the Senate Armed Services Committee on March 16, 2010, Gen. Petraeus elaborated on the above linkage by noting that “A credible U.S. effort on Arab-Israeli issues that provides regional governments and populations a way to achieve a comprehensive settlement of the disputes would undercut Iran’s policy of militant ‘resistance,’ which the Iranian regime and insurgent groups have been free to exploit.”

Former United States Ambassador Daniel C. Kurtzer and Scott B. Lasensky identified additional links between the Israeli-Palestinian conflict and its detrimental impact on United States interests by observing that it makes our counterterrorism effort more difficult, complicates economic and political reform in the region, increases Islamic militancy, weakens regional cooperation on Iraq and nuclear proliferation, destabilizes the region, and serves as a recruiting tool by extremist to attract disenchanted Arabs and Muslims to attack America.

The detrimental consequences to America’s national interests of continuing settlement activity in the occupied Palestinian Territory is increasingly recognized at the highest levels of America’s national security establishment. In January 2010, the Joint Chiefs of Staff were told by senior military officers of the Central Command that Israeli intransigence was, according to a report by Mark Perry, “jeopardizing U.S. standing in the region…” and as a result “America’s…military posture in the region was eroding…” This briefing was the background for Vice President Biden’s reported quote by the Israeli newspaper Yedioth Ahronoth, that “any decision about construction that undermines Palestinian rights in East Jerusalem could have an impact on the personal safety of American troops fighting against Islamic terrorism." Vice President Biden’s statement has not been officially denied.

While the prevention of a resolution of the Israeli-Palestinian conflict caused by the settlements damages America’s interests, it also damages Israel’s interests. The continuation of the conflict prevents Israel from being fully accepted in the region. As stated in the Arab League peace plan, the resolution of the conflict based on a viable and sovereign Palestinian state alongside Israel, will bring a normalization of relations with the Arab world. This will enable Israel to join forces with other states in the region to confront common challenges.