The situation deteriorates further when five more…

The situation deteriorates further when five more Israelis are killed and more than one hundred and seventy wounded in a triple suicide bombing in Jerusalem at the Ben Yehuda pedestrian mall on September 4.

Netanyahu responds to the terror by closing off Palestinian areas and holding back some forty million dollars in Palestinian tax payments, measures that exacerbate economic hardship and draw widespread international condemnation.

The Egyptians, Europeans, and Americans spearhead mediation efforts to break the deadlock.

The American plan is based on a simple formula: the Palestinians need to show determination in word and deed to crack down on terror, and the Israelis have to refrain from further unilateral actions like the construction at Har Homa.

U.S. Secretary of State Madeleine Albright visits Israel and urges Netanyahu to accept a "time-out" on settlement activity for the duration of peace negotiations.

The Israelis insist that both the scope and the duration of the time-out be more closely defined.