Prominent Israelis call for the establishment of a Palestinian state. The New York Times looks at why Judge Goldstone reconsidered his views on the Gaza war. Hamas arrests suspects in the murder of an Italian activist, and kills one. Pres. Abbas and other PLO officials say Palestinians will approach the UN in September, but say they still have confidence in Pres. Obama. Abbas says he will not accept another armed uprising against Israel. Fatah say they are still open to a compromise with Hamas, but Danny Rubinstein says Hamas isn’t interested. A settler shoots a Palestinian near Nablus. Israel indicts an Australian man on accusations of working with Hamas, and arrests four Palestinian lawyers accused of passing messages to Islamic Jihad. Moth infestations threaten Gaza crops. PA officials say they face a “double fiscal crisis.” Shlomo Avineri says PM Netanyahu should give a speech to Israelis, not Americans, clarifying his vision for the future. Amira Hass says the murder of settlers doesn’t justify collective punishment against Palestinians. International activists seek to protect Palestinian fishermen from the Israeli Navy. Umm el-Fahm boasts a significant art gallery. Jonathan Freedland says peace needs more international supporters. Displaced Palestinian refugees in Lebanon finally get new homes.

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