Israel and the PA are in a confederation, highlighted by Israel's collection and transfer of tax revenue (and its repeated suspension) and the common currency of the NIS. Even an otherwise independent Palestine (not possible really because Israel will not forego military sovereignty), would be quite foolish to abandon the NIS therein. The question is not One or Two States, but the character of the present confederation, which is indeed brutally unstable. I remain of the view that incremental improvement of this confederation is the only presently plausible forward.