Israel's in the news again. I see three options for peace in the middle east, all of which has both positives and negatives. Which one of these are positive and which are negative depends on who you are. My policy is "fuck the militants" because they're the ones who see all compromise as bad and demand unworkable positions.
As a background: The region is under war between two groups. The Hebrew tribes controlled the region from 3560 BC until 70 AD. Then conflict with the Romans kicked them out. Another group, primarily Arab, moved in. They were conquered a few times, by various powers, ending with the Ottoman Empire. None of these powers evicted the Arab tribes.
When England defeated the Ottoman Empire, they inherited control of the region in the form of the "Mandate of Palestine." They gave the half on the east side of the Jordan river to the Heshemites, forming the Kingdom of Jordan. They had claimants of both the decedents of the Hebrew tribes, the Jewish people, and decedents of the Arab tribes, the Palestinians, and took matters to the UN for adjudication.
The UN suggested dividing the remaining territory. The Arab tribes opposed this and rioted. This spiraled into a war which the Arab tribes lost. Egypt and Jordan (and Syria and Lebanon) joined the war on the Arab side, Egypt grabbing what is now known as the Gaza Strip, and Jordan grabbing what is now known as the West Bank. Neither one assimilated the region into their own country, but allowed displaced Arab tribes to live there. This was 1948. The victorious Jewish groups declared the state of Israel in their territory.
A second war emerged in 1967, in which Israel conquered the Gaza Strip and the West Bank. Egypt and Jordan were again belligerents, which worked out poorly for them. Israel did not incorporate the people living in those regions as citizens, leaving them in a stateless limbo.
Both sides have militants who claim that God himself granted them the right to the entire thing (and most or all of Jordan as well), and rabidly oppose any claims to the contrary.
Accordingly, I now see three possible solution, which I have produced little maps. By taking a tourism map and doodling on top of it.
Option one: Two State Solution
In the two state solution, Israel gives up Gaza and the West Bank (the regions marked in green on the map)to a new nation, Palestine, which will have a "right of return" for the Arab tribes. Presumably there will be a large shuffling in which people move to their preferred side of the border. The two would recognize each other's right to exist.
This solution is preferable to those who want cultural purity, as both sides will now have room for their culture to dominate their particular region. Both sides will retain basic identity, pleasing the nationalists.
Militants would probably remain angry over artifacts on the other side of the border, many of which are claimed by both sides. (Commonly, the site of one religious artifact would have another built on top of it, such as the remains of the temple destroyed by the Romans having a mosque built on top of it.) Militants would also be upset at not receiving the entire region, but it's at best irrational of them to expect this, and at worst, totally stupid.
The new Palestine should work on establishing alliances, and should avoid declaring war on anybody until it's developed considerable economic and military power. (Especially no wars with Israel, who could conquer it in about 3 hours.)
Also, would likely change into the three state solution, because Gaza is almost pure Hamas and the West Bank is almost pure Fatah, creating a Pakistan-Bangladesh-type situation.
EDIT: An anonymous reader proposes an interesting variant in which the west bank is divided into interlocking spirals, and both sides get all their population centers, most of their holy sites, continuous territory, and the advantage of surrounding the other side. Mutually. Sweet plan, anonymous reader.
Option two: One State Solution
Israel would assimilate the stateless people in the West Bank and Gaza, granting them all rights, privileges, and duties of citizenship. Represented in this picture by replacing the white section of the Israeli flag with Arab-style green.
Both sides could now legitimately claim to control the entire territory, as they would now be the same nation. This country would be immensely powerful, have an increased economic base, and be at peace. Naming and control issues would be decided democratically.
Cultural groups would be irritated at the influence the two cultures would inevitably have upon each other from constant contact. Also, the resulting country could no longer claim to be exclusively Jewish, as it would be about 49.5% Arab. Arabic would need to be added to the list of official languages for the sake of govern-ability.
This is the preferred solution of Liberal groups worldwide, and hopefully it would improve relations around the Arab world. (Though I imagine groups would find other grievances to whine about.)
Militants would whine about the presence of the other group in their country, but would sound like Nazis for doing so, so to hell with them.
Option Three: Evil
Israel's military power exceeds Palestine's enough to blow them away. Genocide like this tends to piss off everyone on Earth, and Israel would be from that day forward a pariah state. Arab states would almost certainly declare war. Only Christian or Jewish fundamentalists would want to help Israel, and they are not a majority in any country. Other powers might or might not declare war. Israel almost certainly wouldn't survive, and if it somehow did, it would be greatly diminished and despised for centuries.
It would make every insult ever lobbed in Israel's direction true.
Thankfully, very few people in Israel are anything but opposed to this, so I'm sure it won't happen.
In order of viability, I see it like this: Two state, One State, Status Quo, Evil.