Netanyahu blames the Palestinians for the deadlock. The prime minister imposed a partial freeze on settlement construction early in his term, leading to a brief attempt to resume negotiations. But Netanyahu refused to extend the construction slowdown, and the talks quickly collapsed. He says talks should resume without any preconditions.
The deadlock has pushed Palestinian President Mahmoud Abbas to head to the United Nations this week to upgrade the Palestinian observer mission to "nonmember state" status. The General Assembly is expected to pass the request.
The Palestinians believe the international endorsement, while largely symbolic, will bolster their position if negotiations resume. Israel, backed by the United States, opposes the bid and has been furiously lobbying allies to oppose it, saying all differences must be resolved through negotiations. In a setback for Netanyahu, France announced Tuesday that it would vote in favor of the Palestinians.
At a time when there are no talks with the Western-backed government of Abbas, Israel this week opened an indirect dialogue with Abbas' rival, the Islamic militant Hamas movement, as part of a cease-fire that ended an Israeli military offensive in the Gaza Strip last week. Israel considers Hamas, which seized control of Gaza five years ago, a terrorist group.
"Everything is upside down: a government that negotiates with terrorists and freezes all dialogue with those who work to prevent attacks," Livni said.
Livni told the audience that the fighting in Gaza, in which her youngest son was mobilized to Israel's southern front, had factored into her decision to return to politics.