Built into Fayyad's neoliberal economic prescription for statehood is a no-nonsense, Giuliani-style emphasis on security. Of the $500 million PA receives annually in foreign aid, $100 million goes toward maintaining law and order. The Palestinian security forces — a 2,000-man contingent of which has been trained by U.S. Lt. Gen. Keith Dayton — has done such an admirable enough job of keeping the peace that, since 2008, Israel has reduced its major manned checkpoints in the West Bank by about two thirds. A Palestinian can today drive from Jerusalem to Hebron on Route 60 without facing any physical impediments. In mid-August, the IDF even began tearing down a 600-meter concrete barrier erected a decade ago to protect the southern Jerusalem neighborhood of Gilo from Palestinian gunfire. 

IDF spokesperson Lt. Col. Avital Leibovich told me that apart from Hamas's vicious and opportunistic murder of settlers this week, designed to derail the Washington summit, there were just two other incidents in all of 2010 in which Israeli civilians were killed in the West Bank. Otherwise, she said, the security situation was still "stable." (Also noteworthy was the PA's rapid response to these killings: within less than 24 hours of the first incident, Fayyad's security forces had rounded up close to 200 Hamas agents in the West Bank.)

With such concrete achievements in mind, might there not be room for PA President Mahmoud Abbas and Israeli Prime Minister Benjamin Netanyahu to fashion a modest consensus? Call it Phase Two of Palestinian state-building.

First, Israel can do more to speed up the erasure of its military footprint in the West Bank. In addition to manned checkpoints, there are over 500 dirt roadblocks still in place, the further reduction of which would enable greater internal mobility for Palestinians but also act as a sweetener for corporate investment. Second, according to the PA's checklist for state-building, many crucial projects have yet to receive funding. These include those that Israel has it in its long-term interests to see implemented, such as updating the Palestinian legal framework, training more civil servants, building new complexes for the security agencies, investing in civil defense infrastructure and bolstering the judiciary in the north West Bank. 

In return, the PA can offer Israel something it's been wanting for decades: substantive educational and cultural reforms to ensure that future generations of Palestinians are reared on the value of peaceful coexistence with the neighbors, not violent irredentism. PA television under the control of Fatah and PLO hardliners still broadcasts news and quiz shows that speak of Israeli cities such as Ashkelon and Haifa and Acre as part of Greater Palestine. The PA Ministry of Agriculture currently displays maps of the Levant sans a Jewish state. These are some of the milder geographic offenses. Abbas should also pledge to end the state-backed promulgation, in the arts and press, of paranoid conspiracy theories that blame Israel for spreading the AIDS virus, assassinating Arafat and introducing drugs into Palestinian society.

Fortunately, Fayyad seems keen on exactly these types of reforms as well. On August 8, speaking in Arabic, he introduced an unprecedented program for rehabilitating Palestinian education, which he rightly called a "key priority" for statehood. He fastened on three areas for scrubbing the current curriculum: strengthening language skills, teaching critical thinking over rote memorization, and eliminating religious fanaticism and indoctrination. Boys and girls should learn to shake each other's hands, Fayyad said, not just because women are equal to men but because tomorrow's Palestinian businesspeople will not navigate a global marketplace if their social customs are rooted in sharia law. (Unsurprisingly, Hamas assailed this plan as a "war on Islam.")

The upside to pessimism is that you can always be pleasantly surprised. Grand-gesture diplomacy a la Oslo has failed precisely where the less romanticized policy of bricks-and-mortar Palestinian state-building has excelled, albeit quietly. It'd be a waste of perfectly good low expectations not to expand upon this propitious reality in the days and weeks to come.