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No war, no peace, is the usual state of affairs between Israel and its neighbours in the Middle East. But every time an attempt at Arab-Israeli peacemaking fails, as US President Barack Obama's did shortly before Christmas, the peace becomes a little more fragile and the danger of war increases. Sadly, there is reason to believe that unless remedial action is taken, 2011 might see such a war.

Israel's fear of Iran's nuclear programme is only one of the fuses that could detonate an explosion at any moment. Another is the frantic arms race that has been under way since the inconclusive war in 2006 between Israel and Hezbollah, Iran's ally in Lebanon. Both sides have been intensively preparing for what each says will be a "decisive" second round.

Such a war would bear little resemblance to the previous clashes between Israel and its neighbours. For all their many horrors, the Lebanon war of 2006 and the Gaza war of 2009 were limited affairs. On the Israeli side, in particular, civilian casualties were light.

Since 2006, however, Iran and Syria have provided Hezbollah with an arsenal of perhaps 50,000 missiles and rockets, many with ranges and payloads well beyond what Hezbullah had last time. This marks an extraordinary change in the balance of power. For the first time a non-state actor has the power to kill thousands of civilians in Israel's cities more or less at the press of a button.

In that event, says Israel, it will strike back with double force. A war of this sort could easily draw in Syria, and perhaps Iran. For the moment, deterrence keeps the peace. But a peace maintained by deterrence alone is a frail thing.

The shipment to Hezbollah of a balance-tipping new weapon, a skirmish on the Lebanese or increasingly volatile Gaza border — any number of miscalculations could ignite a conflagration.

All of this should give new urgency to Arab-Israeli peacemaking. Give the Palestinians a state on the West Bank and it will become very much harder for the rejectionists to justify going to war.

Don't give up

Easy enough to say. The question is whether peacemaking can succeed. After striving for almost two years to shepherd Israeli and Palestinian leaders into direct talks, only for this effort to collapse over the issue of colonies, Obama is in danger of concluding like many presidents before him that Arab-Israeli diplomacy is a Sisyphean distraction.

But giving up would be a tragic mistake, as bad for America and Israel as for the Palestinians. The instant the peace process ends, the war process begins, and wars in this energy-rich corner of the world usually suck in America, one way or another.

Israel will suffer too if Obama fails, because the Palestinians have shown time and again that they will not fall silent while their rights are denied. The longer Israel keeps them stateless under military occupation, the lonelier it becomes — and the more it undermines its own identity as a liberal democracy.

Instead of giving up, Obama needs to change his angle of attack. America has clung too long to the dogma that direct talks between Israel and the Palestinians are the way forward. The recent history proves that the extremists on each side are too strong for timid local leaders to make the necessary compromises alone.

It is time for the world to agree on a settlement and impose it on the feuding parties.

The outlines of such an agreement have been clear since Bill Clinton set out his "parameters" after the failure of the Camp David summit a decade ago. The border between Israel and a new Palestine would follow the pre-1967 line, with adjustments to accommodate some of the bigger border-hugging Israeli colonies in the West Bank, and land-swaps to compensate the Palestinians for those adjustments.

But there is also much difficult detail to be filled in: how to make occupied Jerusalem into a shared capital, settle the fate of the refugees and ensure that the West Bank will not become, as Gaza did, an advance base for war against Israel after Israeli forces withdraw.

Clinton unveiled his blueprint at the end of a negotiation that had failed. Obama should set out his own map and make this a new starting point. He should gather international support for it, either through the United Nations or by means of an international conference. But instead of leaving the parties to talk on their own after the conference ends, America must ride herd, providing reassurance and exerting pressure on both sides as required.

Obama has shown in battles as different as health reform and the New Start nuclear treaty with Russia that he has the quality of persistence. He should persist in Palestine, too.