Obama Admin Rips Israel for New Construction; Israel Says Housing Not a 'New Settlement'

WASHINGTON -- Both the White House and State Department slammed Israel today for new construction in the West Bank, claiming that Israeli Prime Minister Benjamin Netanyahu went back on his word -- something the Israeli government denied.

Israel's Foreign Ministry said in a statement that 98 housing units approved in Shilo "do not constitute a 'new settlement'" as they "will be built on state land in the existing settlement of Shilo and will not change its municipal boundary or geographic footprint."

"The units are intended to provide a housing solution for the residents of Amona who must leave their homes in accordance with the demolition order issued by Israel's High Court of Justice," the MFA said, adding "Israel remains committed to a solution of two states for two peoples, in which a demilitarized Palestinian state recognizes the Jewish state of Israel."

"The real obstacle to peace is not the settlements – a final status issue that can and must be resolved in negotiations between the parties - but the persistent Palestinian rejection of a Jewish state in any boundaries."

The State Department first lashed out with a lengthy statement claiming the "new settlement, which could include up to 300 units, would further damage the prospects for a two state solution."

"The retroactive authorization of nearby illegal outposts, or redrawing of local settlement boundaries, does not change the fact that this approval contradicts previous public statements by the Government of Israel that it had no intention of creating new settlements," said spokesman Mark Toner. "And this settlement's location deep in the West Bank, far closer to Jordan than Israel, would link a string of outposts that effectively divide the West Bank and make the possibility of a viable Palestinian state more remote."

"It is deeply troubling, in the wake of Israel and the U.S. concluding an unprecedented agreement on military assistance designed to further strengthen Israel's security, that Israel would take a decision so contrary to its long term security interest in a peaceful resolution of its conflict with the Palestinians," he added. "Furthermore, it is disheartening that while Israel and the world mourned the passing of President Shimon Peres, and leaders from the U.S. and other nations prepared to honor one of the great champions of peace, plans were advanced that would seriously undermine the prospects for the two state solution that he so passionately supported."

Toner said Israel "must ultimately decide between expanding settlements and preserving the possibility of a peaceful two state solution" as "such moves will only draw condemnation from the international community, distance Israel from many of its partners, and further call into question Israel's commitment to achieving a negotiated peace."

White House press secretary Josh Earnest told reporters at the daily briefing that the announcement of settlement construction "does provoke strong feelings in the administration."

Earnest reiterated the same State Department talking points about the recently signed 10-year Memorandum of Understanding (MOU) that pledges $38 billion in U.S. security assistance, as well as the death of Peres and "the settlement location [that] is far closer to Jordan than it is to Israel."

In his speech last month before the United Nations General Assembly, Netanyahu stressed that "the conflict raged for decades before there was a single settlement, when Judea, Samaria and Gaza were all in Arab hands."

"The West Bank and Gaza were in Arab hands and they attacked us again and again and again. And when we uprooted all 21 settlements in Gaza and withdrew from every last inch of Gaza, we didn't get peace from Gaza – we got thousands of rockets fired at us from Gaza," the prime minister added. "This conflict rages because for the Palestinians, the real settlements they're after are Haifa, Jaffa and Tel Aviv."

"Now mind you, the issue of settlements is a real one and it can and must be resolved in final status negotiations. But this conflict has never been about the settlements or about establishing a Palestinian state. It's always been about the existence of a Jewish state, a Jewish state in any boundary."