The resignation of Palestinian Prime Minister Salam Fayad is further evidence that the new American administration will not be able to advanceme the Israeli-Palestinian “peace process.” “Fayad’s resignation on Saturday was received with a sigh of relief by many Hamas and Fatah officials,” writes The Jerusalam Post’s Khaled Abu Toameh. But there is no relief for those Europeans, Americans and - yes - Israelis who’re trying to improve conditions for the Palestinians and advance the bottom-up process of “building Palestinians institutions.” For all those external players, Fayad was the go-to guy - the manifestation of possible change in the Palestinian Authority.

While the U.S. is publicly stating that Israel and the PA should continue their talks in the absence of Fayad, officials familiar with the Palestinian government understand that this will become much trickier in the coming months: “Fayyad, who is considered the Palestinian Authority official who is closest to the Americans, is the only one who the American government trusts and is ready to transfer funds through.”

This was true when the Bush administration was in power, and is still true today. Fayad is also the Palestinian official with whom “special envoy” Tony Blair dealt most extensively. Note that in almost every relevant public statement from Washington over the last couple of years, Fayad’s name was specifically mentioned alongside that of Palestinian President Mahmud Abbas. “[O]ur hope is that President Abbas and that Prime Minister [Salam] Fayyad, who is a good fellow, will be strengthened to the point where they can lead the Palestinians in a different direction,” President Bush said in July of 2007. With the “good fellow” opting out it’s not clear how international aid money will be channeled to the PA as promised last week. (One possible solution: Fayad will return to his role as Finance Minister. This would be a bitter pill for Hamas to swallow).

Thus, while the Palestinian partner is becoming less promising and more complicated to deal with, it seems that the administration is pulling out of the bag the only available trick: pressuring Israel on the settlement issue:

Israel is under increased pressure from the United States over settlement construction. In the past month, since Barack Obama was sworn in as U.S. president, Israel has received four official complaints from members of the new administration regarding various issues linked to West Bank settlements.

A senior government official in Jerusalem told Haaretz that the complaints represent a gradual increase in American pressure vis-a-vis settlement activity. “This is going to be one of the main issues that the Obama administration will be dealing with in the coming weeks and months,” the official said. “It is not going to be easy to argue with them.”

This pressure from the Obama team was to be expected but, with the resignation of Fayad, its futility will be even more evident than usual. Those who expect the freezing of settlement activities to make peace more probable should prepare for disappointment. Since peace is not in the cards as a short-term cause, Obama may want settlement activities halted in hopes of not derailing future agreements. That would be long-term future — when a new Fayad is found.

Commentary - http://www.commentarymagazine.com/blogs 2009