Five options are currently being analyzed. The first is for neither side to make compromises and let the status quo persist. From an Israeli perspective, this may be the worst scenario. Asher Susser, professor of Middle Eastern History at Tel Aviv University, argues that it is in Israel's best interest to end the conflict since time does not favor the Israelis.

"Time favors the Palestinians; they have demography and worldwide sympathy on their side." Susser adds, "Israel must detach itself from the Palestinians in order to sustain its majority Jewish, democratic character."

The second option is for the Israeli leadership to continue negotiations solely with Palestinian President Mahmoud Abbas and his Fatah-led Palestinian Authority (PA). This option seems flawed for both parties, as the negotiations neglect participation from the 1.3 million Gazans who elected Hamas.

This approach has not received sufficient encouragement and support from the United States, whose administration does not show the will or the way to effectively find a political solution. The Arab states for the most part, too, have shown little public support for Israel-PA negotiations and have failed on numerous occasions to unite the warring factions of Hamas and Fatah.

The third option is for Israel to grant citizenship to Palestinians living in the territories and incorporate them into a bi-national state. This proposal has received some praise from academics, Marxists and intellectuals, mostly living outside Israel. Libyan leader Muammar Gadhafi has called for a one-state solution based on Yugoslavia and Lebanon (which are failed models) and calls it, "Isratine." Hamas and Islamic Jihad could never support this because Palestine would lose its "Islamic" character and most Israelis could never support this because Israel would lose its "Jewish" character.

The fourth option, which was first raised 40 years ago, is the linkage of the West Bank and Gaza Strip into some type of federation or confederation with Jordan. This plan, advocated by some in Israel's Likud Party, assumes that the Palestinians would be happy and willing to live under Jordanian rule. Palestinians might prefer this option as long as they themselves were the rulers of Jordan, not the Hashemites. Also, Palestinian nationalism is too strong of a force today to be assimilated into Jordanian society. Moreover, an additional 4 million Palestinians could destabilize Jordan, which is already 60 percent ethnic Palestinian, and has already granted more than 1 million Iraqi refugees asylum.

The fifth and perhaps best option available is the Arab Peace Initiative, first proposed by Saudi Arabia in 2002 and revived in 2007. The peace plan is endorsed by all 22 Arab League states and offers full diplomatic and normalized relations with Israel in return for Israel withdrawing to its June 4, 1967 borders. A Palestinian state with East Jerusalem as its capital could presumably end not only the Israeli-Palestinian conflict, but also the Israeli-Arab conflict.

Israel, however, rejects the Arab demand for a "right of return" in the literal sense, but there could be room to negotiate a compensation package for Palestinians displaced during the 1948 war.

Jerusalem is no doubt a sensitive issue for Israelis, but it is no longer taboo. Former Prime Minister Ehud Barak offered most of East Jerusalem to Yasser Arafat in 1999, along with approximately 95 percent of the West Bank and 100 percent of Gaza plus $30 billion to repatriate Palestinian refuges. If Barak was willing to offer essentially an early blueprint of the Arab Peace Initiative, why not go the extra mile and accept the offer in principle and negotiate the final status issues to satisfy both sides?

These actions would end the state of war and usher in a new era of stability, security, and hope because fulfillment of the Arab Initiative would also isolate, undermine, and delegitimize the rejectionist camp which includes Hamas, Hezbollah, and Iran. Their modus operandi is not to reach a peaceful settlement to end the conflict, but to promote a continuation of war and chaos. These instigators thrive on the lingering Israeli-Palestinian conflict and exploit it by inciting, indoctrinating and radicalizing Muslims into believing that Arab and Muslim weakness is a result of an Israeli-Zionist plot backed by the West (mainly the United States) to humiliate Arabs and destroy Islam.

Ultimately, Israelis and Arabs could realize their full potential and embark on social, cultural, political, and economic reforms. Arab ingenuity and oil power combined with Israeli capitalist and technological expertise could radically transform the Middle East from a war-torn, conflict-ridden, unstable region into an advanced, progressive and economically powerful market on par with the European Union.

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Michael Sharnoff completed his Masters in Middle Eastern History at Tel Aviv University and is a freelance writer in Washington, DC