At the beginning of the latest US-Israel crisis over the issue of the settlement freeze, the Americans considered both carrot and stick to “encourage” the Israelis to do the right thing, in accordance with international law.

Among the incentives that special adviser to Secretary of State Hillary Clinton Dennis Ross and company convinced the White House to offer the Israelis was a set of the latest US fighter planes, to the tune of $3 billion, a commitment from Washington to veto any UN Security Council resolution calling for the recognition of Palestine and incorporating the Israeli demands regarding security presence in the Jordan Valley.

At the same time, the Israelis were told that if they do not adhere to the commitments they themselves had made by accepting the roadmap, the US would support Arab and international demands for the recognition of a unilaterally-declared Palestinian state.

Israel has clearly rejected the US carrot and we are now awaiting to see if the stick will surface in any form.

Palestinians and their supporters are not asking or expecting the US to impose any economic sanctions on Israel. Nor are people asking the US forces to begin a blockade on Israel. In fact, as far as I am aware, no one is asking the US to do anything by way of reprimanding Israel. Some are simply asking the Americans to stop protecting Israel. If Washington agrees to do so, however, a major political earthquake is bound to take place.

Initially, some Israelis will proudly denounce the US and insist on their independence. Israeli leaders repeatedly said that they were no banana republic and that they took decisions that fit their national interest. This might be the initial response, but I am certain it will not be the last word from Tel Aviv.

If America joins the rest of the world in politically isolating Israel because of its refusal to adhere to international law, this will have a snowball effect that will most certainly lead to change in the Israeli political scene.

The change could be the Labour Party’s withdrawal from the government, thus crippling Prime Minister Benjamin Netanyahu’s coalition and forcing him to either change course or call for new elections.

The big question, however, is whether the Obama administration, which has just come out of difficult midterm elections, will follow through on the obvious next steps.

There is no doubt that Netanyahu is counting on his allies to bail him out. Pro-Israel politicians like Republican number two congressman Eric Cantor have actually made public statements that favor Israel over his own country.

Many analysts said that Netanyahu, who spent some time in the US, was counting on this issue when he agreed to only a 10-month moratorium on settlement construction, knowing full well that President Barack Obama will be much weaker after November 2, 2010.

Obama has been weakened, but it would be a big mistake for the Israelis to count him out. Already this week, the Democratic president has concluded a taxation and unemployment deal with his Republican rivals.

Israel would also be mistaken to count too much on Congress regarding national security issues. US foreign policy has always been made in the White House and Obama has at least two more years in office.

Dan Kurtzer, former aide to Obama and former US ambassador to Israel, publicly attacked the carrot idea, calling it a “bribe” and advising not to haggle with the Israelis.

The Americans have to take a position. Not taking a position now would be a major victory for a country that is clearly violating international law by building settlements in occupied areas.

The big question now is whether Obama will have the courage to fulfill his self-prescribed plan for how to deal with the crisis with Israel. With the carrot having failed to dissuade the Israelis, it is time to get out the stick, or at least stop protecting the pariah state of Israel.

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