ATFP President Ziad Asali explains the Palestinian state and institution building program. At a major conference in Israel, PM Fayyad demands an end to the occupation, and DM Barak says without peace, Israel will be an apartheid state. Hamas says it may broaden the conflict with Israel. Israel is still considering options on a prisoner exchange. Hamas submits its response to the Goldstone report. A senior Fatah leader makes a goodwill visit to Gaza. A third "barrel bomb" washes up on an Israeli beach, and Israel bombs a Gaza smuggling tunnel in response. Dubai warns Israel, Hamas. A Ha'aretz commentary says fear of peace will be the death of Israel. Israeli officers and international experts say the Israeli military violated the rules of war by placing soldiers lives ahead of civilians. Special Envoy Mitchell reportedly urges Europeans to push for renewed negotiations.