It would be nice to think that the strenuous efforts of our indefatigable secretary of state to jumpstart peace talks between Israel and the Palestinians have a realistic chance of success. But they don’t. The problem isn’t just that, contrary to all sense, Israeli Prime Minister Benjamin Netanyahu continues to expand settlement activity in the West Bank. And it isn’t only that, just as direct talks are getting under way for the first time in years, the Palestinians appear to be ramping up their charming tendency to quote Adolf Hitler admiringly in schoolroom textbooks.

As the controversy surrounding Netanyahu’s demand that the Palestinians recognize Israel as a "Jewish state" makes clear, the most intractable obstacle to peace is that so many people — in the Middle East and in the United States, on the sidelines and at the negotiating table — persist in demonstrating delusional thinking about the conflict.

Let’s begin with the delusion at play in the Times story on the controversy. It is, frankly, difficult to understand how at this late date, 65 years after the "Declaration of Establishment of the State of Israel" pronounced that the new nation would be a "Jewish State," anyone could describe Netanyahu’s demand as shocking or surprising. I can certainly believe that the self-righteous simpletons at the American Studies Association could be scandalized by the news. And I definitely understand why Palestinian Authority President Mahmoud Abbas would consider it helpful for his PR efforts to stir up controversy among the ill-informed. (More on this below.)

But short of a monumental bout of amnesia, how could the Times possibly treat Netanyahu’s position as newsworthy? Israel was explicitly founded to be the national homeland of the Jewish people. The rights of non-Jews living within the state would be protected, but only Jews (living in diaspora around the world) would be entitled to take advantage of the "Law of Return" and become instantaneous Israeli citizens; non-Jews, by contrast, would have to apply for naturalization after an extended period of residency. This is very old news.

Which isn’t to say it shouldn’t trouble the liberal-democratic conscience. The denial that it should is another delusion — and we regularly see it at work among Israel’s strongest American defenders, from liberals to neoconservatives and evangelical Christians, all of whom delight in describing Israel as an embattled American-style democracy surrounded by hostile, illiberal forces.

This is true — but only up to a point. Israel is indeed a democracy, but its status as a "Jewish state" makes it less liberal than most of the world’s democracies. To state the obvious: Liberal democratic governments normally strive for (while often falling short of complete) neutrality with regard to the ethnic and religious attachments of citizens.

Israel is different, with Judaism granted special status due to the Zionism intertwined with its founding and embedded in its legal system. That doesn’t make it evil. But it does make it less classically liberal than the United States and most other liberal-democratic nations — and that can be grounds for legitimate criticism (as opposed to criticism motivated by anti-Semitism, of which there is plenty).

When the late historian Tony Judt argued that Israel should abandon the Zionist dream of creating a distinctively Jewish state in favor of becoming a binational Jewish-Palestinian state, for example, he may have been being wildly and irresponsibly unrealistic, but he wasn’t expressing a hatred of Jews. He was denying that Israel could be both essentially Jewish and essentially liberal — and he chose to side with liberalism.

When Israel’s American defenders take a stand for Zionism, they should be equally honest about the compromises it requires. (The increasing unwillingness of young American Jews to sacrifice their liberalism for Zionism is what lies behind the trends that Peter Beinart highlights in his provocative recent writing.)

But there's an even bigger, more intractable delusion: The one that Abbas encourages when he treats the recognition of Israel’s Jewish character as a sticking point in peace talks.

Netanyahu does not always act and speak reasonably, but he’s fully justified in demanding that the leader of the West Bank Palestinians accept that Israel’s status as the homeland of the Jewish people is non-negotiable. The very fact that Abbas refuses to agree to this demand proves the point Netanyahu was surely trying to make in issuing it: That Palestinian leaders continue to entertain the fantasy that the Jewish state can be made, somehow, to disappear.

That isn’t going to happen — now, or ever.

Until the Palestinians of the West Bank (let alone the even more delusionally intransigent Hamas-led Palestinians of Gaza) accept that cold, hard, ineradicable fact, they will continue to suffer in statelessness.