WASHINGTON — Israel and the United States Thursday backed away from a week-old confrontation over Israel's plans to build 1,600 new apartments for Jewish residents in East Jerusalem, which Israel captured from the Arabs in 1967.
Prime Minister Benjamin Netanyahu, in a phone call with Secretary of State Hillary Clinton, offered to take some steps to help restart peace talks, and Clinton directed U.S. special envoy George Mitchell to travel to the region this weekend after suspending his mediation several days ago.
The easing of tensions came days before Netanyahu is to arrive in Washington to address the American Israel Public Affairs Committee, the leading pro-Israel lobby. A pall descended over U.S.-Israeli ties after Netanyahu's interior minister announced the new construction, which the Obama administration opposes, after Vice President Joe Biden began a visit to Israel last week.
U.S. and Israeli officials wouldn't spell out what steps Netanyahu agreed to take, and it wasn't clear whether they'll be sufficient enough to bring Palestinian President Mahmoud Abbas back to the negotiating table.
There was no sign that Netanyahu would cancel the plan to build the apartments in the Ramat Shlomo neighborhood in East Jerusalem, which Israel considers part of its undivided capital.
Israel could delay the start of construction, but in the past it's always pressed forward with such expansions.
With President Barack Obama postponing his Asia trip to focus on health care legislation, he and Netanyahu will be in Washington early next week. White House officials said there was no decision whether the two leaders will meet.
Israeli news reports said that Netanyahu told Clinton that Israel is willing to release Palestinian prisoners, remove checkpoints on the West Bank and perhaps even transfer some lands to Palestinian control to facilitate peace talks.
Clinton and Mitchell will now have to convince Palestinian leaders, whose position was undermined by the March 9 East Jerusalem announcement, that they should begin indirect talks with Israel.
"What we're focused on is getting back to where we were a little over a week ago," when the Israeli-Palestinian "proximity" talks were announced, said a senior U.S. official, who wasn't authorized to speak for the record.
State Department spokesman P.J. Crowley, in a statement from Moscow, where Clinton was traveling, said that she and Netanyahu "discussed the specific actions that might be taken to improve the atmopshere for progress toward peace."
"We are going to review the Prime Minister's response and continue our discussions with both sides," Crowley said, adding that Mitchell will visit the Middle East this weekend.
Senior U.S. officials initially responded to the building plans in unusually harsh language, with Clinton calling the move "insulting."
Clinton and others toned down their rhetoric starting Monday, and began looking for a way out of the crisis that would at the same time boost talks on an independent Palestinian state.
Obama's credibility as a Middle East mediator is at stake in how the dispute is resolved — and how it's perceived to be resolved in the Middle East and beyond.
Obama already backed away once, last year, when he softened his demands that Israel agree to a comprehensive settlement freeze, including what Israel calls "natural growth" of existing settlements. Instead, he agreed to Netanyahu's offer of a 10-month halt that excluded East Jerusalem.
The Arab world, in particular, will be watching closely to see if Obama has stood his ground this time.
"People in this region can smell weakness 10,000 miles away," said an Arab diplomat, who requested anonymity to speak more frankly.
If Obama backs down, "it adds to the perception that he's a relatively weak leader in foreign policy. . . . That has consequences across the board," said William Quandt, a University of Virginia professor who worked for President Jimmy Carter on the Camp David accords between Israel and Egypt.
Obama's dilemma is made more difficult by the fact that he made tough demands last year but did not enforce his will, said Aaron David Miller, who advised six secretaries of state on the Middle East.
"They can still redeem themselves. But it's not going to be easy. . . . Round One went to Bibi," Miller said, using Netanyahu's nickname. If Obama is seen to falter again, "The 'street cred' will be minus zero," said Miller, who's now with the Woodrow Wilson International Center for Scholars.
The senior administration official argued that Obama's record ultimately will be judged on whether he can revive Israeli-Palestinian peace talks.
If that happens, "all these other questions (about U.S. credibility) will take care of themselves," the official said. People in the Middle East "are more concerned about getting results."
On his Washington trip, Netanyahu is bringing Defense Minister Ehud Barak, a former Israeli prime minister who's seen here as more moderate than the prime minister.
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