In an otherwise compelling analysis of why negotiations for a compromise two-state settlement of the Israeli-Palestinian conflict have repeatedly failed ("What Future for Israel?" New York Review of Books, August 15, 2013), Nathan Thrall, a senior analyst at the International Crisis Group, argues that the standard compromise proposals would “almost certainly not achieve an end of conflict.”
The Palestinians, Thrall writes, “believe the core of the conflict is Zionist settlement in Palestine and the expulsion of Palestinians during the 1948 war that established the Israeli state,” and for this reason “the belief of American and Israeli negotiators that solving the problems of 1967 will close the door on those of 1948” is mistaken: “the root of the conflict is not east of the Green Line but in the more than century-old project of Zionist settlement itself.”
Evidently then, Thrall accepts the common but mistaken view that even moderate Palestinian leaders continue to insist that any settlement of the conflict must include a literal “right of return”—meaning the return of millions of Palestinian refugees and/or their descendants to their former lands, homes, and villages in pre-1948 Palestine, before they fled or were driven out by Israel.
The evidence suggests otherwise. In fact, most Palestinian leaders have long understood that the right of return demand is unrealistic: the leading non-Hamas Palestinian officials, from Yasser Arafat’s PLO through Mahmoud Abbas’s Palestinian Authority, have repeatedly—and not merely privately--made it clear to the Israeli and U.S. governments that they would not allow the refugee issue to block an otherwise acceptable two-state settlement.
As early as 1990, Abu Iyad, the leading PLO official after Arafat, openly stated as much in the prominent journal Foreign Policy: “We accept that a total return is not possible….we recognize that Israel would not want to accept large numbers of Palestinian returnees who would tip the demographic balance against the Jewish population.... Nonetheless, we believe it is essential that Israel accept the principle of the right of return or compensation with the details of such a return to be left open for negotiation....We shall for our part remain flexible regarding its implementation.” [emphases added] 
Shortly afterward, Arafat himself privately confirmed the real Palestinian position. In December 2000 Arafat wrote to Clinton that the Palestinians were “prepared to think flexibly and creatively about the mechanism for implanting the right of return.” Then, in a widely-noted 2002 New York Times op-ed, Arafat publicly repeated that there would have to be “creative solutions” to the issue: “we understand Israel’s demographic concerns and understand that the right of return…must be implemented in a way that takes into account such concerns.” Two years later, in a Haaretz interview—this time speaking directly to the Israelis-- Arafat reiterated that it was “clear and obvious” that the refugee problem would have to be solved in a manner that “would not change the Jewish character of the state.”
Mahmoud Abbas, Arafat’s successor, made it clear both in the unofficial but highly influential Geneva Accords of 2003 and in his 2008 negotiations with Israeli Prime Minister Ehud Olmert that he was prepared to effectively drop the right of return. The full record of those secret negotiations has not been released, but there have been a number of analyses, based on detailed interviews with Abbas and Olmert, that have concluded that “both leaders agreed on the principle that a certain number of Palestinians should return, but that the governing question should be how to limit that number in a way that preserves Israel’s distinction as a state with a Jewish majority but that does not prejudice the rights of the Arab minority.”
Even the numbers issue was essentially resolved in subsequent secret Israeli-Palestinian negotiations. In January 2011 the British newspaper Guardian published the “Palestinian Papers,” based on the Wikileaks documents, which revealed that during the negotiations with Olmert in 2009, the Palestinian leaders “gave up the fight over refugees…Palestinian negotiators privately agreed that only 10,000 refugees and their families….could return to Israel as part of a peace settlement….PLO leaders also accepted Israel’s demand to define itself as an explicitly Jewish state, in sharp contrast to their public position.”
Thus, it has become increasingly clear that the true demand of most Palestinian leaders is a symbolic one, that the Israelis acknowledge their responsibilities for the expulsion or flight of the Palestinians during and following the 1948 and 1967 wars, but that in practice the rights of the Palestinian refugees can only be realized by some combination of a small-scale family reunification return to Israel, a right of return to the Palestinian state of most of the refugees and their descendants, or voluntary resettlement elsewhere, accompanied by major international economic compensation and assistance.
Aside from the Palestinians, the Arab world as a whole has made it clear that the right of return issue will not be allowed to block an overall Arab-Israeli settlement: in 2007 the twenty-two states of the Arab League unanimously approved a peace plan that does not mention a Palestinian “right of return” but rather states that “a just resolution of the refugee problem” should be “agreed upon.” This carefully chosen language, like the Geneva Accord and the Abbas-Olmert negotiations, effectively grants Israel a veto on the issue.
None of this is to challenge Thrall’s pessimism about the prospects for an Israeli-Palestinian peace, but if the territorial and other issues were to be settled, it is not likely that the right of return would be an insuperable obstacle to a negotiated settlement.
 Abu Iyad, “Lowering the Sword,” Foreign Policy 78 (Spring 1990), p. 103.
Jane Perlez, “Expectations Low As Clinton Pushes Plan with Arafat,” New York Times, January 3, 2001.
 Arafat, “The Palestinian Vision of Peace,” New York Times, February 3, 2002.
 “A Jewish State? Definitely,” Haaretz, June 18, 2004.
 The quote is from Bernard Avishai, “A Plan for Peace That Still Could Be,” New York Times Sunday Magazine, February 7, 2011.
 Guardian, “Palestine Papers: Palestinians agreed only 10,000 refugees could return to Israel,” 24 January, 2011.