Secretary of State Kerry devoted most of his talk at Davos today to crafting a framework to resolve the Palestinian-Israeli conflict around the following prinicples:

"An independent state for Palestinians wherever they may be; security arrangements for Israel that leave it more secure, not less; a full, phased, final withdrawal of the Israeli army; a just and agreed solution to the Palestinian refugee problem; an end to the conflict and all claims and mutual recognition of the nation-state of the Palestinian people and the nation-state of the Jewish people."

He also predicted that a failure of the current round of talks would be catastrophic for both parties as well as for the US. He suggested that the UN had neither the ability or the credibility to grant the Palestinian aspiration for independence, and if they failed to achieve it in this round of negotiations with the Israelis, another opportunity would not be likely to arise in the near future. He warned that unilateral acts by either party could precipitate a downward spiral back to violent conflict.

With regard to the eventual complete withdrawal of Israeli troops he added that "the Israelis rightfully will not withdraw unless they know the West Bank will not become a new Gaza, and nobody can blame any leader of Israel for being concerned about that reality." He said that the US, Israel, Jordan and the Palestinians have discussed the creation at the border with Jordan, a "security structure that meets the highest standards anywhere in the world," one which would have the capacity to thwart "an individual terrorist or a conventional armed force."

He emphasized that both sides would gain from a peace agreement. Palestine would achieve independent statehood and the chance for economic prosperity. Israel would get diplomatic recognition and economic ties with the Arab and Muslim world. Estimates are that could result in a six percent increase in GDP per year for Israel.