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Time is running out in the U.S.-backed Israeli-Palestinian peace talks scheduled to end in April. And so, it seems, is U.S. patience.

Secretary of State John Kerry went to Jerusalem and Ramallah last weekend for the 10th time since last summer when the nine-month talks were announced and he carried an ultimatum: either put aside your differences and agree to a framework for a final peace agreement or do without U.S. support.

Rather than paring down the list of items for discussion, however, Israel has raised the ante, making two previously extraneous and controversial issues the keys to any deal.

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In the first six months of talks, the government of Benjamin Netanyahu dusted off a 1967 plan for annexing the occupied Jordan Valley. Then, this week, its Foreign Minister resurrected a 2004 proposal to cede several Arab-Israeli communities to a future Palestinian state, in exchange for the Palestinians agreeing to forego their claim to several parcels of West Bank land on which large blocs of Israeli settlements sit.

The need to retain the Jordan Valley, captured along with the rest of the West Bank in 1967, is based on Israeli security concerns, the government says. Even if a future Palestinian state is demilitarized, there will always be a threat from other Arab states who could cross the Jordan River and attack Israel, the administration reasons.

It's not the first time the argument has been used. Just weeks after the 1967 Six-Day War, Yigal Allon, a cabinet minister and former military commander, proposed just such an annexation. The map he drew would give the occupied Jordan Valley and Judean Desert west of the Dead Sea to Israel, while the rest of the more heavily-populated West Bank would be given back to the Jordanians who had occupied it previously.

Never approved by any of the Israeli administrations of the 1960s and 70s, and dismissed by Jordan's King Hussein, the plan was discredited as ineffective and unduly provocative.

The notion that keeping such frontier territory would be a deterrent to a foreign attack didn't stand the test of 1973. Israel's occupation of the Golan Heights and Sinai Peninsula, both also captured in 1967, didn't prevent Syria and Egypt from attacking Israel. Indeed, the occupation was a motive for the attack.

More than that, the nature of warfare has changed markedly since 1967. It takes just three seconds for a foreign fighter jet or missile to cross the Jordan Valley, and missiles in Israel can strike at any advancing army to the East or anywhere else. With mountains on either side of the Jordan Valley, it would be "a death-trap for any forces deployed within it," wrote Shlomo Brom, a former head of military planning. Contrary to popular opinion, the Jordan Valley would be of no use in repelling any invader.

Annexing the valley would, however, deprive a Palestinian state of badly needed territory in which to house a growing population, and fertile land with which to feed it.

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None of this, however, stopped right wing members of the governing coalition from backing a bill last week to effectively annex the Jordan Valley, despite an appeal from Prime Minister Netanyahu not to support the measure.

Into this diplomatic tinderbox, Israeli Foreign Minister Avigdor Lieberman has tossed a lighted match – his decade old plan to swap populated territories with the Palestinians.

"I will not support an accord unless it includes land and population swaps," Mr. Lieberman announced Sunday.

While many people – Israelis, Palestinians and outsiders – condemned the notion 10 years ago as a kind of ethnic cleansing, the controversial scheme may actually provide a much needed means for breaking up the negotiations' logjam.

Mr. Lieberman has proposed that Israel willingly give up to the Palestinian state some of Israel's most densely-populated Arab-Israeli communities, including the volatile city of Umm al Fahm, centre of an anti-Israeli branch of the Islamic Movement led by a former Umm al Fahm mayor, Raed Salah. In return, Israel would be allowed to annex the major blocs of Israeli settlements in the West Bank.

In interviews with scores of Arab-Israelis since 1982, I found very few who say they would prefer to move to a Palestinian state, rather than stay in their current Israeli communities. They are attached to their towns and villages, they say; the homes of their ancestors. But the appeal of the Lieberman plan is that they would stay in their communities; it's the border that would move.

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True, many Arab-Israelis identify with the predominantly Jewish state and benefit from it. Better the devil they know, they reason, rather than whatever devil may lurk in a future Palestinian state.

Here too, the Lieberman plan has an option: It would allow Arab-Israelis to move to another community within Israel, or to accept the change in jurisdiction to the Palestinian state yet continue to enjoy Israeli health and other benefits for the rest of their lives.

Any citizen, Arab or Jew, who chose to stay in Israel would have to take an oath of loyalty in order to retain their Israeli citizenship; failure to do so would cost them their citizenship, though they still would be classified as permanent residents.

It's worth noting that Umm al Fahm was to be part of the Arab state proposed by the UN partition plan of 1947, but it and the rest of the triangle were awarded to Israel in the 1949 armistice talks in order to provide for increased Israeli security, being a kind of buffer zone.

The Lieberman scheme has undeniable potential and will likely grow in popularity. Many Jewish Israelis like the idea of being rid of Umm al Fahm and its anti-Israeli tendencies. Palestinians, though they don't admit it, probably relish the idea of being joined by such vibrant established communities.

With the resurrection of this plan, Mr. Lieberman has catapulted himself into the centre of the Israeli-Palestinian negotiations just as they approach their climax. Beyond his land-swap proposal, he has become Mr. Kerry's biggest supporter among Israel's right wing, arguing that the American's proposed framework offers the best course possible.

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Recently cleared of corruption charges, Mr. Lieberman is rumoured to want to take his Yisrael Beitenu party out of the electoral partnership he made 15 months ago with the Likud. Doing so would enhance his negotiating powers within the coalition and free him to seek the prime minister's position after the next elections.

It certainly wouldn't hurt his chances if he were viewed as the right wing leader with a pro-American viewpoint. And with his commitment to a Palestinian state, however self-serving, the Palestinians could do a lot worse.

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