After the new Israeli government was formed, and the new foreign minister in Israel stated his opinion that this is were the "process" stops, Obama got stressed and sent his negotiator Mitchel to pressure Netanyahu to continue milking Israel in exchange for nothing.
Netanyahu expressed two key points with regards to continuing with the 2 states solution:
1. The Palestinians must recognize Israel's right to exist as a Jewish state. Which they refuse. The Arabs want an Arab state, and an Arab state with some rights for Jews. There's an unabridged difference of perception regarding what does a "2 state solution" mean.
2. Hamas controls Gaza - reaffirmed by Gaza take-over, any further steps taken without changing the status quo will lead to Iran/Hamas taking over the areas around Jerusalem and close to all major Jewish population. Fatah's leadership has been proven to hold no roots in the Arab population and once given chance are overthrown.
Then Mitchel went on to meet with the Palestinains, who basically made demands that Obama punishes Israel, refused to recognize Israel's right to exist as a Jewish state, and not so thinly veiled threat to resume violence - peace process bull-crap, violent threats void any appearance of peacefulness. Everything the Arabs said here was in code words. So naive people can understand what they want, but if you've been following the situation - it is quite clear.
Netanyahu: We won't accept another Hamastan
PA: Recognition of Israel as Jewish State a 'Provocation'
Pressure Israel to accept two states, Palestinians urge Mitchell
'Palestinians must accept Jewish state'
US official: No alternative to 2-state solution
The Americans have not gone back on a firm demand made during Condoleezza Rice's tenure as secretary of state, that Israel halts the construction of settlements completely, including in the Jerusalem vicinity.
Another demand relates to Israel's immediate commitment to remove all illegal outposts, and a third demand is that the Netanyahu government recognizes its commitment to reignite the dialogue with Palestinian President Mahmoud Abbas and Prime Minister Salam Fayyad.
"Contrary to the impression created in Israel by the new government," said an American source between one meeting to another, "President Obama is determined to advance the peace process with the Palestinians in the near future.
'Pressure Israel, or peace process will be a joke'