The problem is not obtaining a Palestinian state. Israel itself desperately needs a
Palestinian state, since it can neither bestow citizenship on the Palestinians nor deny it to
them permanently.
In order to retain its Jewish character yet control the entire country,
Israel must somehow "relieve itself" of the Palestinian population. The only way out
(except for transfer, which is impossible in the present circumstances) is to establish a
Bantustan.
Sharon has suggested a Bantustan (he calls it a plan of "cantonization") on
40% of the West Bank, but has indicated that he is willing to unilaterally "give" the
Palestinians 60%, perhaps even a bit more. Labor, wishing to make a Bantustan
cosmetically acceptable, would offer up to 85% of the Occupied Territories, knowing that
Israel needs just a strategic 15% to retain control.