It is an Israeli public problem. The views of the public in Israel at this time are very radical and are not conducive to peace at all.
The reason that extreme views in Israel are politically viable - despite the obvious long term interests of the State, is the unconditional American support.
If normal geopolitical conditions applied to Israel, we probably would have had peace a long time ago in the Middle East.
In that sense our blind support to Israel hurts everyone in the Middle East, Israel included.
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