Middle East Inside Line: First Indirect Israel-Palestine Talks; Israel Warns Iran; West Jerusalem's Economic Win

First Indirect Talks End in Success? The US State Department announced on Sunday that the first round of indirect peace talks between Israel and the Palestinian Authority has been completed, saying that both Israel and the Palestinians had taken steps to create an atmosphere conducive to successful talks.

State Department spokesman P.J. Crowley said in a statement that US special envoy George Mitchell has left the Middle East after concluding talks characterized as "serious and wide-ranging."

Middle East Inside Line: Israel-Palestine Indirect Talks; Syrian-Turkey Meeting

Crowley said Israel had pledged not to build in the Ramat Shlomo neighborhood of East Jerusalem for two years and that Palestinian Authority leader Mahmoud Abbas vowed that he would work against incitement of any sort. He warned both parties:

As both parties know, if either takes significant actions during the proximity talks that we judge would seriously undermine trust, we will respond to hold them accountable and ensure that negotiations continue.

Sources close to Israeli Prime Minister Benjamin Netanyahu confirmed the situation in Ramat Shlomo.

However, on Sunday, Peace Now said that renovation work has recently begun for the construction of 14 housing units in an old Israel Police station in East Jerusalem, where plans are in the works for the largest Jewish neighborhood in that part of the city. The construction of 104 housing units is to be connected to an existing Jewish neighborhood, Ma'aleh Zeitim, and will be occupied by some 200 families.

"This is the first violation and first breach of the terms to start the indirect negotiations," said Abed Rabbo, the secretary of the Palestine Liberation Organization's Executive Committee. He added, "We will act immediately to stop this, because we will not agree that negotiations will be used as a cover for settlement activities."

Jerusalem Mayor Nir Barkat, meanwhile, vowed to continue "planning and construction throughout the city for all its residents". He said, "We trust that the prime minister will not allow a freeze in Jerusalem, not in words and not in actions."

Israel's Warning to the "Existential Threat": Addressing a conference on air power, Vice Prime Minister Moshe Ya'alon said on Monday that Israel has the technological capabilty to launch a military strike against Iran. He added:

There is no doubt that the technological capabilities, which improved in recent years, have improved range and aerial refueling capabilities, and have brought about a massive improvement in the accuracy or ordnance and intelligence.

This capability can be used for a war on terror in Gaza, for a war in the face of rockets from Lebanon, for war on the conventional Syrian army, and also for war on a peripheral state like Iran.

As far as I'm concerned, attack remains the best form of defense.

There is no doubt, looking at the overall situation, that we are already in a military confrontation with Iran. Iran is the main motivator of those attacking us.

Israel's Economic Victory: The Organization for Economic Cooperation and Development accepted Israel on Monday despite the reservations of Switzerland, Ireland, and Norway about Israel's membership.