Why is a shared Jerusalem necessary for a just and lasting Israeli-Palestinian peace?
Jerusalem is holy to each of the three Abrahamic faiths, and each has a long history of dwelling in the city. Both the Israeli people and the Palestinian people see Jerusalem as central to their identities, historically as well as in the present time. For a peace agreement between Israelis and Palestinians to be just and fair to all involved, it would need to allow both Israel and a future Palestinian state to share Jerusalem, mutually ensure access to all of the holy sites for people of all faiths, and allow both Israel and a future Palestinian state to claim Jerusalem as a capital. While a two-state solution without a shared Jerusalem is, in the strictest sense possible, it is neither just for conducive to a lasting peace. Any suggestion that Jerusalem should be the sole possession of either Israel or the Palestinian people is incompatible with a just and lasting peace.

What is the modern history of the Israeli and Arab presence in Jerusalem? 
During the years of the British Mandate over Palestine (1920-48), Jerusalem existed as a single city with Jewish, Muslim, and Christian neighborhoods, though the communities were frequently at strife with one another. In 1947, as the end of the British Mandate was approaching, the United Nations proposed the partition of historic Palestine into a Jewish state and a Palestinian state. Jerusalem would have been territorially fully within the Palestinian state, though it would have been internationally administered and accessible to all. Jewish leaders in Palestine accepted this proposal while Arab leaders rejected it. When the Mandate expired in 1948, Israel declared her independence along the lines suggested by the UN partition plan and was subsequently invaded by her Arab neighbors. The resulting war placed a much greater percentage of the land in Israeli hands than the partition plan, with Israel’s territory extending all the way to Jerusalem. The West Bank, rather than becoming a Palestinian state, came to be occupied and annexed for the next two decades by the Kingdom of Jordan. Jerusalem was subsequently divided, with the Western portion belonging to Israel and the eastern portion belonging to Jordan. Following the 1967 Arab-Israeli War, Israel came to occupy East Jerusalem and the West Bank, driving the Jordanian presence to the opposite side of the River Jordan. Israel publicly support UN resolution 242 in the wake of the 1967 war, which would have returned all of the occupied territories to their original owners in exchange for Arab recognition of Israeli sovereignty over its land, but this principle was rejected by the Arab League. Israel has since annexed Palestinian East Jerusalem through Israeli law, though this is not recognized by any major members of the international community. Complicating matters, Israel has systematically seized Palestinian property in and around East Jerusalem for the construction of Israeli settlements, creating “facts on the ground” that raise substantial practical questions about how, and even whether, East Jerusalem could serve as the capital of a future Palestinian state.

What is the official position of the Israeli government toward a shared Jerusalem?
Past Israeli governments have declared a willingness to share Jerusalem with the Palestinians as part of a final peace agreement, and – as noted above – Israel supported the 1967 UN resolution calling for the return of all the occupied territories, including East Jerusalem, to their original owners in exchange for Arab recognition of Israel’s right to exist. The current government of Prime Minister Benjamin Netanyahu has, however, never accepted the principle of Palestinian sovereignty for any of East Jerusalem (however defined geographically) and any recognition of East Jerusalem as the capital of a Palestinian state. Mr. Netanyahu recently stated, “We are building [settlements] in Jerusalem because it is our right and our duty.”

Why is United States recognition of the need for a shared Jerusalem important?
The United States enjoys a closer diplomatic relationship with Israel than any other nation and, as a result, has significant diplomatic influence with the Israeli government. At the present moment, the President’s proposal for direct negotiations between the parties on the basis of the 1967 borders with land swaps has been included in the Quartet’s September 2011 invitation to negotiations. Negotiations, however, are not yet in sight. As a result, both parties have an obligation to avoid steps that further complicate the possibility for a just and peaceful resolution to the conflict. Israeli settlement construction in East Jerusalem is clearly such an issue. Thus, the United States, as Israel’s closest ally, should use whatever influence at its disposal to urge Israeli restraint in settlement construction in East Jerusalem.