So, Mahmoud Ahmadinejad has, by hook or by crook, been returned to a second term of office in the Iranian elections, albeit with a suspiciously large majority. This means that the public face of Iran will continue to be an apocalyptically minded fanatic with a fetish for Holocaust diminishment and denial. If Israeli Prime Minister Benjamin Netanyahu does not make much of this in his major policy address tomorrow, and his allies in the United States do not make much of it in the American policy conversation, I will be very much surprised. Of course, power in Iran over foreign and military policy, among other things, as always rested squarely in the hands of the supreme leader, presently Ayatollah Khamenei. However, core diplomatic realities are exacerbated by the grotesque demagoguery to which Mr. Ahmadinejad appears in no common measure addicted. I don’t know about Iran, but in the United States and the Arab world, the war parties and clash-of-civilization types are certainly celebrating.

As for Netanyahu’s speech, there are already signs of dissatisfaction among Obama administration officials with what has been advertised in advance. Ha’aretz reports that, "The proposals to be outlined in Prime Minister Benjamin Netanyahu’s speech on Sunday will not be enough to satisfy the Obama administration, a senior U.S. official was quoted as saying.” The same report suggests that the outcome of the Iranian election can only intensify interest in moving towards an end-of-conflict agreement between Israel and Palestinians since, "U.S. President Barack Obama says containing Iran’s nuclear aspirations — which Israel considers a major threat — would be helped by progress toward a Palestine deal.” Indeed, US Special Envoy to the Middle East, George Mitchell, has continued to emphasize the seriousness of Washington’s new engagement, most recently by declaring that the US "supports the creation of a Palestinian state ‘as soon as possible.’” Meanwhile, signs are increasing that some members of Congress who have been increasingly critical of settlements and the occupation and supportive of President Obama’s peace initiative are beginning to feel the pressure from Jewish constituents in their districts. Movement by all deeply committed parties was always likely to be of the 3-steps-forward, 2-steps-backward variety, and entirely contingent upon momentum for progress.

Even though it’s very likely that Netanyahu’s speech will not fully satisfy the Obama administration, it’s also quite possible that they may cautiously welcome his remarks, in order to encourage further moves and out of an understanding that Netanyahu is constrained by his own coalition partners. It is essential that the administration not waver on the fundamentals of its position on a settlement freeze and a two state solution. However, as I noted recently, giving Netanyahu the time, space and political cover to adjust to the new American attitude is infinitely preferable to any sort of avoidable confrontation.

It is likely that Netanyahu is going to give way, at least in theory, to a Palestinian state, possibly with conditions. The conditions are not as important as they might first appear, as they represent the opening bargaining position from the present Israeli government, and not any fait accompli. The more crucial issue, and the thing to be listening for, is what language Netanyahu will be using to describe his policy on settlements. The Obama administration has been clear, consistent and extremely firm in ruling out all forms of settlement activity, although some kind of accommodation that allows for a degree of "natural growth" of structures but does not increase the size of any existing settlements in territorial terms is possible. However, it is unlikely that, over the long run, Netanyahu is going to be able to sell the administration on anything less than a real settlement freeze, no matter what kind of window dressing he can arrange for his right-wing allies.

The reason the administration is so firm on this issue is that Israeli compliance on Roadmap commitments, especially a settlement freeze, and Palestinian compliance with security commitments, sets the stage for revisiting the innovation to the Roadmap introduced in Annapolis, whereby phase 1 commitments such as settlements and security take place simultaneously as the beginning of negotiations on phase 4 permanent status issues. In other words, if a settlement freeze is achieved, and security measures are being taken by the Palestinians, it should be possible for the administration to begin to insist on convening permanent status talks and returning, at long last, to the fundamental issues. There are signs that the administration is very keen on beginning a serious negotiation on the question of borders, that being perhaps the most difficult and important of all permanent status issues.

The administration’s entire approach suggests a determination to actually achieve the outlines of an agreement, and perhaps even an agreement itself in the foreseeable future. If Netanyahu shows a willingness to go along with the essence of this by agreeing to a de facto settlement freeze with some obfuscations designed to mollify Israeli extremist sentiment, this will be a major step in the right direction, and certainly enough for the administration and the Palestinians to work with for the time being. At that point, it will be all the more important to bring the Arab states in to play a responsible role in building the conditions for peace. However, if Netanyahu falls radically short of the administration’s firm position on settlements, we will have moved one step closer to a confrontation between his government and the Obama administration, in which everyone could end up the loser. Except, perhaps, Ahmadinejad.