...Of the core issues standing in the way of resolving the Israeli-Palestinian conflict, borders, refugees, and settlers have emerged as intractable and zero-sum in nature. The key to peace is to transform zero-sum issues between the parties into workable solutions that address at least some of the concerns of all constituencies, while staying true to international norms. Negotiators have made little to no advances on key issues, including: where the border will be; what the final destiny of Palestinian refugees and their descendants will be; whether each side can recognize the others' right to self-determination within only a portion of the land they both claim; whether the parties can reconcile their national narratives with international law; how each state can reconcile its nationalist nature with the rights of its significant minorities; whether Israel can be a Jewish state as defined by the Israeli right and still be a democracy; and  what happens when the Arab minority in Israel grows closer to being a majority.

These problems have been made inexorable in part by an assumption of nationalist exclusivity and by the national narratives of both people. Most Israeli Jews do not recognize the need for a Palestinian state as one of Palestinian rights but as a necessity of Jewish demographics. The argument of Israeli leaders from Yitzhak Rabin to Ariel Sharon and Ehud Olmert has been that in order for Israel to maintain its Jewish character it must divest itself of non-Jews. The only internationally-acceptable way to do that is by creating a Palestinian state in parts of the West Bank and the Gaza Strip.

For their part, Palestinians do not recognize the right of Jews to self-determination in all of historic Palestine. Because of the balance of power heavily weighted in Israel's favor, the majority of Palestinians choose to exercise their right to self-determination in only 22 percent of historic Palestine (the West Bank, including East Jerusalem, and the Gaza Strip). Many Palestinians may accept Israel's right to exist, but they don't accept a superior Jewish right to self-determination over Haifa than for the Palestinian inhabitants who lived there in 1947 or who live there today.

It is clear to anyone from Israel and Palestine that both peoples hold to a nationalist narrative tied to all of Eretz Israel/historic Palestine. The problem is not so much that their maps don't acknowledge the other state - it is that they both have the exact same map (minus the Golan Heights for the Palestinians).

That fact cannot be discounted, nor should it.

There are ways for Israelis and Palestinians to have their cake and eat it too - still within the rubric of a two-state solution and still within the confines of their nationalist narratives. There are ways for settlers to maintain their ties to the Land of Israel and for Palestinian refugees to re-establish their relationship to historic Palestine.

A Permanent Residency Status can help expand the pie by offering a new and creative solution that adds flexibility and space to final status issues. A Permanent Residency Status law can be composed of a set of mutually agreed upon arrangements between the state of Palestine and the state of Israel. It opens the space to separate the material livelihood and political aspirations of both peoples, leading to a sustained national majority in the political system of each state, while making the physical movement of people a matter of personal choice [i]...