President Barack Obama deserves acknowledgement for his efforts to realize a two-state solution, but applause is un-called for. One must begin to question the depth of Obama’s strategy, as his moves in the process seem more and more reactionary. Pressuring Israel to implement a 10-month West Bank settlement freeze was the right move, but waiting until it was nearly expired to make any further moves effectively eliminated any significance it had. Furthermore, the scheduling of peace talks at the same time as mid-term elections may have been inevitable considering the non-stop American political cycle, but it has severely limited his political capital to exert further pressure on the Israelis. As the peace talks he fought so hard to start teeter on the brink of collapse, what does the American president have up his sleeve?

Pressuring Israel to enact a 10-month settlement freeze was perhaps a necessary precursor to renewing the long-stalled peace talks. However, waiting so long to make his next move essentially wasted the momentum created by the freeze and the ensuing public chilling of relations between the US and Israel. By the time the American-sponsored peace summit materialized (and with it, the most optimism the region has seen in years), the settlement moratorium was weeks away from expiring. Had the US held its summit in month-five, or six, or even seven, there would have been time left to work with.

It may have been Obama’s intention all along for the freeze to become permanent, or to become some new status quo in Israel. This certainly seems to be sitting Palestinian Authority President Mahmoud Abbas’ understanding. Abbas told the Arab League last week that he would return to the negotiating table only if the freeze is extended. The US has been raising the idea that with a short extension, the only issue on the table should be hammering out borders so that the issue of settlements becomes moot – Israel would be able to continue building on their side of the future border. Why wasn’t this idea pushed halfway through the initial settlement freeze?

Now, Obama finds himself in a situation where one issue – settlements – is standing in the way of the peace process. Settlements are huge in any peace deal, but to let one issue stymie the very beginnings of the talks was a huge mistake. Alas, we shouldn’t dwell on the past. What can he do next?

The US holds two major cards over Israel’s head: economic and military aid, and its support in the international arena, particularly in the UN. For a handful of reasons, he does not hold the economic card at the moment.

George Bush Sr. was able to use threats of withholding economic aid in order to force a similar settlement freeze nearly twenty years ago, but under entirely different circumstances, domestically in both the US and Israel, and also geopolitically. Bush enjoyed widespread public and congressional support in the US following the Gulf War, then Israeli Prime Minister Yitzhak Shamir was lacking in domestic support for standing up to Israel’s financial and military big brother (among other reasons). Barack Obama currently faces the prospect of losing both houses of congress to the Republicans, something that will pre-empt any moves that are seen as putting heavy pressure on Israel. Netanyahu came out of the latest spat with the US relatively unscathed domestically. Contrarily, it made him appear stronger, something Israeli leaders are known to have wet dreams about. Geopolitically, Bush Sr. had just neutralized Israel’s biggest threat when he threatened to withhold loan guarantees from the Israelis. Today, Israel is facing a new Iranian threat, which the US has thus far been unsuccessful at mitigating.

So barring a change in Israel’s refusal to extend the settlement freeze (there is talk of a meeting between Netanyahu and opposition head Tzipi Livni – possibly about her Kadima party helping form a “peace coalition), Obama is left with only one card to hold over the Israelis. Those pushing for an Israeli-Palestinian peace agreement – on nearly every continent – have been saying for quite some time now that this is the last chance for a negotiated agreement. Abbas reportedly told the Arab League last week that if this round of talks fails, he would seek international support for de facto recognition of a Palestinian State in the pre-1967 borders. This is an ugly scenario that is unlikely to bring any peace in the short term. It would symbolize a major shift in the Israeli-Palestinian power structure that would surely put the Israelis in a defensive posture – which rarely results in peace. Will Obama threaten to go along with Abbas’ unilateral declaration of statehood if the Israelis don’t extend the settlement freeze? This is highly unlikely. It would be more politically palatable for Obama to simply watch his peace process unravel. He certainly wouldn’t be the first to do it.

So what comes next? Let’s just hope that Obama actually has a strategy and that it includes a few more cards up his sleeve.