"There are signs that reality is forcing Prime Minister Netanyahu to the center, just as reality pushed Ariel Sharon and Ehud Olmert, his two predecessors, to the center. Goldblog Central has been hearing rumors and intimations for some time that Bibi is going to announce something dramatic -- perhaps before a joint session of Congress (a friendlier audience than the Knesset, by a long shot). How dramatic? This is what is unclear. It's got to be pretty dramatic to keep Bibi's ostensible allies, President Obama and Angela Merkel among them, from giving up on him. According to Ha'aretz, Bibi has been telling associates that he fears the creation of a binational state in Israel's place if the country fails to allow the birth of a Palestinian state next door. He is even said to be thinking about endorsing a Palestinian capital in East Jerusalem. For a man like Bibi, a hard-edged nationalist, this would be quite something, and would invest a speech with suitable drama." [Emphasis mine.]
Mind you, I've been hearing this BS about a new Israeli peace plan for weeks and weeks, so I'll believe it when I see it, but I've said it before, and I'll say it again. The saddest thing about Israel's situation is that they keep on electing right-wing Prime Ministers who vow not to vigorously pursue a two-state solution, only to wake up a year or two into their terms and all of a sudden realize that, hey, a bi-national state would be really bad, and only then they start to tackle the problem with any urgency. Then, invariably, they get killed/fall into a coma/get taken down for massive ethics violations/whatever will happen to Netanyahu. Then, rinse and repeat.