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Jewish settlers show support for a foundation-laying ceremony in the West Bank settlement of Kiryat Netafim on Sunday, Sept. 26.

Extremists in both the Israeli and Palestinian camps got what they wanted Monday morning - control over whether U.S.-sponsored peace talks will go ahead or not.

Israeli Prime Minister Benjamin Netanyahu, bowing to right-wing members of his coalition government, declined to extend a moratorium on construction in Israeli settlements in the West Bank that had been in place for the past 10 months.

Instead, Mr. Netanyahu appealed for settlers to "show restraint" in the construction of housing and other buildings.

Within hours of his appeal, however, settlers and many of their political leaders were starting work on new buildings even before the midnight expiry of the construction freeze.

"Today it's over and we will do everything we can to make sure it never happens again," settler leader Dani Dayan told a cheering crowd in the West Bank settlement bloc of Ariel, referring to the moratorium. "We return with new energy and a new determination to populate this land."

Palestinian leader Mahmoud Abbas had said he would walk out of the month-old direct peace talks if settlement construction resumed. But, acceding to U.S. wishes, Mr. Abbas softened his position over the weekend. Rather than declare he was walking out of the talks immediately, Mr. Abbas said he would take the matter to his party's central committee and to the follow-up committee of the Arab League. It was those groups that gave their endorsement to Mr. Abbas entering direct talks with the Israelis.

While Mr. Abbas had been given clear direction from his Fatah party and from the PLO, the Palestinian Authority president clearly did not want to shoulder sole responsibility for the fate of the talks.

"We do not need to wait for a meeting to confirm our position to the President," said Mahmoud el-Alul, a member of Fatah's Central Committee. "We already told him our position, which supports his view of rejecting settlement building and settlement expansion.

"We cannot go back to square one," Mr. el-Alul said. "There will be no negotiations with settlement building."

About 300,000 Israeli settlers already live in government-supported communities amidst 2.7 million Palestinians in the West Bank. Another 190,000 Israelis live in parts of Jerusalem occupied by Israel in 1967 and claimed by Palestinians as their capital.

Mr. Abbas's decision to seek counsel gives the Palestinian leadership a few days to think matters over. But if there is to be widespread Palestinian endorsement of continuing the peace talks, the construction "restraint" will have to be considerable.

That is unlikely, however, as Israeli settlers want to abandon the peace talks and keep building. Most settlement leaders adhere to the belief that all of Judea and Samaria, as they call the West Bank, rightfully belongs to Israel.

"For 10 months, you have been treated as second-class citizens," Danny Danon, a pro-settler lawmaker in Mr. Netanyahu's Likud Party, told a rally in the settlement of Revava on Sunday. "Today, we return to build in all the land of Israel."

Palestinians also are divided over the merits of the peace talks. Many believe they are giving up too much for the sake of an agreement with Israel -too much territory; too much sovereign control; too much of their right to return to their homeland and perhaps too much of their proposed capital in east Jerusalem.

"The continuation of these negotiations is a crime against the Palestinian people and a dangerous and slippery slope," Hamas spokesman Fawzi Barhum said on Sunday in a statement issued in Gaza.

"In light of the arrogance and pomposity of the Zionists, Mahmoud Abbas must immediately withdraw from these negotiations and announce their end."

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