US Israel settlements fight marks lowest point since 1970s: ambassador

In a bid to cool tensions with the US over Israeli settlements, which Israel's ambassador described as the lowest point in diplomatic relations since the 1970s, Prime Minister Benjamin Netanyahu apologized again Sunday for last week's announcement of 1,600 new homes in East Jerusalem. His political future may be in jeopardy.

Despite an attempt by Israeli Prime Minster Benjamin Netanyahu to downplay the angry messages from US officials over plans for new homes in East Jerusalem, Israel's envoy in Washington believes it’s the worst crisis between the allies in more than a generation.

Ambassador Michael Oren told Israeli consuls in the US during a conference that a nearly week-old public fight that broke out during Vice President Joe Biden's visit marks a low point in diplomatic relations since the mid-1970s when the Ford administration reassessed ties with Israel over a disengagement agreement with Egypt and froze arms shipments. President Barack Obama has been pushing for a full Israel settlement freeze to get peace talks with the Palestinians restarted.

IN PICTURES: Israeli settlements

The leak of the ambassador's statement to Israeli newspapers Monday could hurt Netanyahu's standing in Israel, where public opinion is historically unforgiving toward leaders who don't manage US relations well, said experts.

"You don't want to be the prime minister that's the worst in the relationship with the US,'' says Mitchell Barak, an Israeli pollster. "[Former Prime Minister Ariel] Sharon was wildly popular, and one of those reasons is because of a close relationship with [Former President George W.] Bush.''

A spokesperson from the foreign ministry did not return a phone call seeking comment.

Another apology for 1,600 new homes

Amid an unusually high-profile flap over Israeli settlements, Netanyahu on Sunday apologized again for what he called the unintentional publication last week of plans to build 1,600 new homes in East Jerusalem, which Palestinians claim as the capital of a future state and which was seized by Israel in the 1967 war. News of the project has prompted the Palestinians to threaten a boycott of negotiations that the US had finally succeeded in renewing, spurring an unusual series of public criticisms of Israel from the Obama administration.

The announcement of the plans came from the Interior Ministry, which is headed by Eli Yishai of the religious nationalist Shas party, prompting speculation that the move was designed to derail Biden's visit and make Netanyahu look bad.

The Israeli press has generally blamed Netanyahu for mishandling the crisis, saying that he has put relations with the US at risk at a time the Jewish state needs close security cooperation to block Iran's nuclear program.

Writing in the daily newspaper Yediot Ahronot, columnist Sima Kadmon bemoaned Washington's "lack of trust'' in Israel. "We deserved this,'' she wrote. We had fully earned the treatment we were receiving.'

Some Israeli experts, however, have accused the US of unnecessarily inflating the crisis over the weekend at a time when Netanyahu had hoped that an initial apology would be sufficient.

How the Israeli public is likely to respond

It's unclear in which direction Israeli public opinion will tip. Will it coalesce behind Netanyahu against an administration that's already seen by Israelis as tilting toward the Palestinians – as it did a year ago when the US first pressured the Jewish state on settlements?

Or will it put the weight of the blame on the prime minister for not doing enough to mollify Israel's most important ally – as it did in 1992 when voters sent home Prime Minister Yitzhak Shamir, in part over his falling out with President George H. W. Bush over settlement expansion?

In Netanyahu's favor is the fact that Israeli public opinion generally backs building in the Jewish neighborhoods of East Jerusalem. While most international observers consider anything over the Green Line to be a "settlement,'' Israelis don't consider the 200,000 Jews living in the urban neighborhoods as settlers.

What's more, public opinion in Israel has been skeptical of Obama's policy in the Middle East as bending over backward to court Arab governments at the expense of the Jewish state. On Sunday, the American Israel Public Affairs Committee (AIPAC), the leading pro-Israel lobbying group, warned the Obama administration of unnecessarily inflating the crisis.

Avi Primor, a former Israeli ambassador to the European Union, speculated that the Obama administration doesn't have the domestic political strength to see through a true crisis in relations, which he said would involve US security backing for Israel. Still the current war in the media will nonetheless take a toll.

"The anger of the American government has a psychological effect on Israeli public opinion which fears a deterioration of relations,'' he said. "The US is Israel's biggest security asset. There is a cost of alienating that asset.''

Indeed, the public remembers the diplomatic turmoil of Netanyahu's first term office unfavorably, and a series of foreign policy gaffes has raised questions about whether the Israeli prime minister has matured since he lost reelection in 1999.

"It’s the same old Stupid Pet Tricks,'' says Barak, referring to the classic segment from David Letterman's show. "He's starting to wear on people. People are starting to say this is the old Netanyahu.''

IN PICTURES: Israeli settlements