Some would argue that Arafat himself did a fine job of damaging Fatah by lining the pockets of his deputies while allowing key institutions to decay. Not Avnery, who is rarely at a loss for damning things to say about Israeli leaders (Shimon Peres--"a man without principle"; Ehud Barak--"a megalomaniac") yet seems incapable of mustering a critical thought about the former PLO chairman. Arafat possessed a "genius" for preventing the strands of his movement from unraveling, Avnery told me. But wasn't he also authoritarian and corrupt? "It's irrelevant," he said. Propped up on a shelf in Avnery's apartment were no fewer than three photos of Arafat, a fondness many find curious. "Where is the criticism he educated us on?" asked Segev, who on several occasions tagged along on visits to see Arafat that Avnery helped to arrange. The excursions had the feel of official tributes paid to the Great Leader in a totalitarian state, Segev said. When he asked Arafat a question one time about human rights abuses carried out by his security services, eyebrows were raised, as though he'd committed an inexcusable faux pas.

The most powerful argument against the two-state solution can be found not in the statements of Hamas hardliners but in the facts on the ground that Israeli settlers have been creating for decades, with no pause to see how negotiations might fare. One morning last summer I traveled through the West Bank with Dror Etkes, a researcher formerly with Peace Now who earlier this year published a report showing that 90 percent of Israeli settlements sprawl beyond their official boundaries. We drove north in his battered pickup truck along a bypass road in the direction of Psagot, a hilltop settlement that overlooks Ramallah. Etkes pulled over. "See that?" he said. Scattered atop a hill in the near distance were a bunch of makeshift trailers and antennas. It was an illegal settlement outpost, built on privately owned Palestinian land. The Israeli government has vowed to block such outposts, but those vows have acquired an increasingly hollow ring. "A classic land grab," said Etkes. Later, along a rutted road slicing through an otherwise isolated stretch of terrain, we came upon a cluster of concrete bungalows next to an open field enclosed by razor wire. The land was uninhabited, but it had been fenced off for a reason: to reserve space for more housing once capacity in the nearby settlement is reached.

It is hard to find an Israeli these days whose confidence in the peace process was not shaken by the wave of suicide bombings that struck the country several years ago. It is equally difficult to find a Palestinian whose faith has not been eroded by the inexorable expansion of the settlements. There were 130,000 settlers in the West Bank in 1993, the year of the famous handshake between Rabin and Arafat. There are 270,000 today. "Israeli governments used Oslo in order to change, dramatically and irreversibly, the geography of the West Bank," Etkes said. In 2000, the year Ehud Barak blamed Arafat alone for Camp David's failure--a spurious claim that quickly became holy writ among many American commentators--construction began on 4,000 housing units in the West Bank, according to Etkes. This was the highest number since the Oslo agreement was signed.

The settlements, the bypass roads, the security checkpoints built like international border crossings, the massive 270-mile separation wall--all this has acquired an air of permanence that some view as grounds for a paradigm shift. At a debate last May in Tel Aviv, historian Ilan Pappé, a radical critic of Zionism, declared, "The real two-states formula is the one which we see being implemented in front of our eyes: half the West Bank annexed to Israel, and the other half as a Bantustan surrounded by walls and fences but allowed to fly a Palestinian flag." The time has come for the peace movement to call for turning Israel and Palestine into one democratic state, he argued. Pappé's opponent was Avnery, who was having none of it. "It is far easier to dismantle a settlement, to dismantle settlements, to dismantle all the settlements--far easier than to force 6 million Jewish Israelis to dismantle their state," Avnery countered.

The problem with the one-state solution is that "nobody wants it except a few intellectuals," Avnery told me. And who exactly will dismantle the growing archipelago of settlements? "Sharon, with all his faults, has shown that it can be done," Avnery insisted. He was referring to Israel's 2005 withdrawal from Gaza, which did not spark as fierce an opposition as many had anticipated. But what has happened since has hardly bolstered prospects for peace. The fact that Gaza is now ruled by Hamas and that the Israeli border town of Sderot has come under steady rocket fire has played into the hands of those who warn that even worse chaos will erupt should Israel withdraw from the West Bank. Even a popular Israeli leader would likely balk at such a step. Israel's prime minister, Ehud Olmert, is deeply unpopular, and the man waiting in the wings, Netanyahu, is about as likely to end the occupation as George W. Bush is to lead the call for pulling US troops out of Iraq.

Things could change if something significant emerges from the upcoming Israeli-Arab summit in Annapolis, Maryland. But few observers expect this to happen; the barriers to forging an agreement in the short term are immense. A relative of mine joked that the slogan "Two states for two peoples" should give way to "Three prisons for two peoples" (meaning Gaza, the West Bank and Israel itself). It's enough to make you wonder why Israelis who yearn to live in a country at peace with its neighbors bother to stick around. The truth is, a growing number don't. Estimates of the number of Israelis leaving the country in recent years range from 19,000 to 30,000 annually, a figure that exceeds the number of Jews making aliyah. In 2004 writer Amos Elon, born in Vienna in 1925 and for decades one of Israel's most esteemed journalists, shipped the last of his belongings to Tuscany, where he now lives permanently, having grown deeply distraught at what's become of his country. Shulamit Aloni, a veteran civil rights activist and recipient of the Israel Prize, the country's most prestigious public citizenship award, hasn't departed yet, but she told me she feels increasingly despondent. "I'm pessimistic," she said. "I fought for years so that we would have a model state--instead we have an ethnocracy."

Avnery is not without worries of his own. In a book published forty years ago, he wrote that "without a policy aimed at securing acceptance by the peoples in the region, any security [for Israel] could only be temporary." Today, instead of seeking acceptance, Israel is erecting walls, and all around it Islamic movements are gathering strength. Avnery admitted to viewing the latter development "with trepidation." But he has also lived long enough to know that walls built to divide people can be torn down. One morning in early September, he made his way to Liberty Bell Garden, in Jerusalem, for a small victory celebration. Earlier in the week, the Israeli High Court of Justice had ruled that a mile-long stretch of Israel's separation barrier must be rerouted, since its sole purpose had been to accommodate a future Jewish settlement. The case had been brought before the court on behalf of the residents of Bil'in, a West Bank village where both Jewish and Palestinian activists had been staging weekly protests, several of which Avnery attended.

In an article written shortly after the ruling was announced, Avnery acknowledged that the decision fell short of a complete victory: the court did not call on Israel to dismantle other parts of the wall that cross over the Green Line, as the International Court of Justice had done in 2004. Even so, he hailed the ruling as a symbol of what ordinary people can accomplish and a reminder that history is not static. "When my friends fall prey to despair, I show them a piece of painted concrete, which I bought in Berlin," he mused. "It is one of the remnants of the Berlin wall.... I tell them that I intend, when the time comes, to apply for a franchise to sell pieces of the separation wall."

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