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An opportunity to make some small progress on the issue of a homeland for Palestinians was stopped in its tracks this week when the Israeli government could not agree on how to proceed. As a result, the Middle East remains bogged down in the same old quagmire.

The 12-member inner Cabinet for Israel split 6-6 on whether to approve an Egyptian proposal for Israeli-Palestinian peace talks to be held in Cairo. The United States had favored the Egyptian plan. The tie vote was the equivalent to rejection of the idea.The outcome demonstrated once again what difficulty Israel has in making foreign policy decisions because the government is equally divided between the right-wing Likud and the center-left Labor parties.

Election after election keeps splitting representation from the two parties almost equally. Neither can acquire a majority, so Israel must function with a fragile coalition government. The parties alternate the top government posts and neither has effective power.

The result is a form of government paralysis - not the best response to the Palestinian unrest in the occupied territories of the Gaza Strip and West Bank. That unrest, mostly in the form of rock-throwing demonstrations, has resulted in nearly 700 Palestinian deaths.

The Palestinians, after 20 years of Israeli occupation, are demanding independence and their own political state, free of Israeli rule. The big question is who would represent the Palestinians. The Palestine Liberation Organization, probably would win any popularity vote, but Israel refuses to talk to the PLO, branding it a terrorist group.

In April, Israel proposed Palestinian elections to pick delegates who could negotiate with Israel. But Palestinians and Arabs generally view the idea with suspicion, especially since the popular PLO is excluded.

The Egyptian proposal would have offered a meeting in Cairo to hammer out the specifics of such an election. But the session in Cairo now appears dead, a lost opportunity.

The tie vote has shaken the Israeli government. The Labor Party has talked of toppling the coalition government and seeking another election. However, most experts view that as merely talk. Any election probably would come out with Parliament still evenly divided.

Peace in the Middle East and creating a homeland for Palestinians are difficult issues. Solving them probably will require bold initiatives by Israel - including the taking of a few chances.

But with a fragile, deadlocked government, Israel does not appear to be in any position to take bold steps. That's tragic because it almost guarantees continuing unrest, confrontations and bloodshed.