Why would the Israelis want an agreement with the Palestinians?

In the Bible, when the Israelites wanted someone else's land, they did an ethnic cleansing. It was easy to justify -- God made them do it. According to the Old Testament, Numbers 33:

And the LORD spake unto Moses ... saying, Speak unto the children of Israel, and say unto them, When ye are passed over Jordan into the land of Canaan; Then ye shall drive out all the inhabitants of the land from before you. And ye shall dispossess the inhabitants of the land, and dwell therein: for I have given you the land to possess it.

God warned them that the cleansing had to be thorough:

But if ye will not drive out the inhabitants of the land from before you; then it shall come to pass, that those which ye let remain of them shall be pricks in your eyes, and thorns in your sides, and shall vex you in the land wherein ye dwell.

God issued these instructions a few millennia ago, but they could have been issued in 1948, when the modern Israelites ethnically cleansed 750.000 Arabs from Palestine and created the nation of Israel. But, failing to heed God's warning, they allowed a substantial population of Arabs to remain. This population has pricked their eyes, been a thorn in their sides and vexes them to this very day.

The ideal for Israel would be to possess a Palestine bereft of Arabs. The international community, on the other hand, has consistently proposed two states, side by side. It continues to push for that solution, with various "road maps" having been proposed over the years. But does Israel have any real interest in this solution? Or does it find the current situation a quite acceptable second best?

One could argue that Israel has the best of both worlds. It has the West Bank available for increased Jewish settlement while keeping the Arabs nicely segregated. It expands its control of the best land and most of the water, destroying Arab assets in the process, while having little responsibility for the Arabs, who have no right to citizenship, welfare, or indeed much of anything. Almost 40 per cent of the West Bank is taken up with Israeli infrastructure which ties the settlements together while separating and isolating the Palestinians. It might be called ethnic cleansing by stealth.

And Israel is under no great pressure to allow an Arab state. It has the most powerful army in the region, nuclear weapons, and the unequivocal support of the most powerful nation in the world. It can do pretty much whatever it wants and the U.S. will back it up.

The only real threat to the Israelis is demographic. It can't incorporate the West Bank and Gaza into Israel because that would add millions more Arabs to Israel's population, gravely diluting its ethnic purity, thus defeating the very purpose of Israel which is its existence as a Jewish state. This is why leaders like Prime Minister Olmert occasionally seem amenable to the two-state solution, albeit reluctantly.

And the demographic threat increases as the Arabs outbreed the Jews. Even within Israel, the Arab portion of the population, already at 20 per cent, steadily grows. The situation is repeated in the West Bank and Gaza. And lurking in the background is the Palestinian diaspora.

But in the meantime, Israel is secure behind its wall, its military and its unequivocal American support while it increases its grip on Jerusalem and its expansion into the West Bank. The longer it delays any agreement, the more leverage it has. And a two-state solution won't solve the demographic problem, the ultimate threat, anyway. So what, from Israel's perspective, is the point of offering the Palestinians anything?