Is the Palestinian Authority finished and, with it, 18 years of the Middle East peace process? That is the question increasingly being asked by Palestinians in the wake of a week of damaging revelations that Palestinian negotiators secretly made major concessions to Israel in talks on Jerusalem, refugees and borders. The question of the PA’s survival, and the future direction of Palestinian politics, has gained added urgency as the wider Middle East is rocked by unrest, from Tunisia to Yemen.

Rivals camps within Israel’s political and security echelons appear to be at loggerheads over whether Israel should keep open an option to launch a military attack on Iran. The feud has been brought to the fore by comments from Meir Dagan, the outgoing director of the Mossad spy agency, that Iran is not in a position to develop a nuclear bomb before 2015 at the earliest. His assessment conflicts with previous Israeli estimates, including one presented in 2009 by Ehud Barak, the defence minister, that Tehran might have a nuclear weapon as soon as this year.

A towering concrete wall looms over the main street of what was once a flourishing market in the northern Israeli town of Baqa al-Gharbiya, or Western Baqa. The 8-metre high barrier separates them from the West Bank and their former twin, Eastern Baqa. Western Baqa’s 22,000 Arab residents say they are opposed to living in the shadow of a wall that separates brothers from sisters and children from their parents. But they were equally unhappy to learn this week that, as part of peace negotiations with the Palestinians three years ago, Israel secretly proposed redrawing the borders to strip them and potentially tens of thousands of other Israeli Arabs of their citizenship.

For more than a decade, since the collapse of the Camp David talks in 2000, the mantra of Israeli politics has been the same: “There is no Palestinian partner for peace.” This week, the first of hundreds of leaked confidential Palestinian documents, the so-called Palestine Papers, confirmed the suspicions of a growing number of observers that the rejectionists in the peace process are to be found on the Israeli, not Palestinian, side.

Thousands of pilgrims flocked this week to Israel’s latest tourist attraction, touted as the place where Jesus was baptised in the River Jordan. Visitors to Qasr al Yahud, in the Jordan Valley, received an unusual welcome, however. They had to pass through a fenced-off corridor warning that landmines surrounded them on all sides. At the river’s edge, they were watched over by armed Israeli soldiers in watchtowers with orders to stop anyone trying to cross the short stretch of water that marks the border with Jordan.

Ehud Barak, Israel’s defence minister, appears to have driven the final nail in the coffin of the Zionist left with his decision to split from the Labor party and create a new “centrist, Zionist” faction in the Israeli parliament. Prime Minister Benjamin Netanyahu has pressing reasons for wanting Barak to stay in the most rightwing government in Israel’s history. He has provided useful diplomatic cover as Netanyahu has stymied progress in a US-sponsored peace process.

Jewish investors, led by a Jerusalem city councillor, last week foiled a bid by businessman Bashar Masri to become the first Palestinian to own a Jewish settlement in East Jerusalem. A coalition of settler groups and Israeli business leaders had branded as “treason” the initial acceptance of Masri’s offer late last month to bail out the settlement project’s owner, Digal, an Israeli investment company.

Benjamin Netanyahu, Israel’s prime minister, risked further straining relations with the White House, already damaged by the impasse in peace talks, by writing an open letter this week to President Barack Obama urging the release of spy Jonathan Pollard. It is the first time that an Israeli government has made a formal request for clemency for Pollard, who was sentenced to life in 1987 for passing thousands of classified documents to Israel while serving in US naval intelligence.

Jonathan Pollak, one of Israel’s most prominent political dissidents, is no stranger to dangerous situations or arrest in the occupied territories. In seven years of joining Palestinians in their weekly stand-offs with the Israeli army at sites in the West Bank, where the separation barrier is being built, he has been arrested “too many times to count”, he said. He has been injured several times. This week, he received his first jail sentence for participating in a mass bicycle ride in Tel Aviv.

Half a million trees planted over the past 18 months on the ancestral lands of Bedouin tribes in Israel’s Negev region were bought by a controversial Christian evangelical television channel that calls itself God-TV. A sign posted a few kilometres north of Beersheva, the Negev’s main city, announces plans to plant a total of a million trees over a large area of desert that has already been designated “God-TV Forest”.

The pretty two-storey home with a red-tiled roof built by Adel and Iman Kaadan looks no different from the rows of other houses in Katzir, a small hilltop community in northern Israel close to the West Bank. But, unlike the other residents of Katzir, the Kaadans moved into their dream home this month only after a 12-year battle through the Israeli courts. The small victory for the Kaadans, who belong to Israel’s Palestinian Arab minority, dealt a big blow to a state policy that for decades has reserved most of the country’s land for Jews.

Israeli police have been criticised over their treatment of hundreds of Palestinian children, some as young as seven, arrested and interrogated on suspicion of stone-throwing in East Jerusalem. In the past year, criminal investigations have been opened against more than 1,200 Palestinian minors in Jerusalem on stone-throwing charges, according to police statistics. That was nearly twice the number of children arrested last year in the much larger Palestinian territory of the West Bank.

Jews must not rent homes to “gentiles”. That was the religious decree issued this week by at least 50 of Israel’s leading rabbis, many of them employed by the state as municipal religious leaders. Jews should first warn, then “ostracise” fellow Jews who fail to heed the directive, the rabbis declared. The decree is the latest in a wave of racist pronouncements from some of Israel’s most influential rabbis.

The Wikileaks disclosure this week of confidential cables from United States embassies has been debated chiefly in terms either of the damage to Washington’s reputation or of the questions it raises about national security and freedom of the press. The new disclosures, however, provide a more interesting and useful insight. Underlying the gossip and analysis sent back to Washington is an awareness from many US officials stationed abroad of quite how ineffective — and often counter-productive — much US foreign policy is.

While Washington struggles to kick-start the troubled Middle East peace talks, Israel has been working quietly over the past few weeks to sabotage the US efforts with a series of measures targeting the most incendiary issue of all – Jerusalem. The latest move was the passage of a law requiring a national referendum before occupied East Jerusalem can be handed over to the Palestinians, who demand it as the capital of their future state.

Top Palestinian officials, including President Mahmoud Abbas, are engaged in “very serious” discussions about whether to abandon negotiations with Israel and seek United Nations recognition of a Palestinian state, a senior Palestinian official said yesterday. The official said there was momentum building among senior Palestinian political figures to act on a long-standing threat to bypass the current peace process, which has stalled, and ask the UN Security Council to recognise Palestinian statehood.

Watching the peace process between Israel and the Palestinians drag on year after year without conclusion, it is easy to overlook the enormous changes that have taken place on the ground since the Oslo Accords were signed 17 years ago. Each has undermined the Palestinians’ primary goal of achieving viable statehood.

Benjamin Netanyahu, Israel’s prime minister, is in the United States this week, but few observers expect an immediate or significant breakthrough in the stalled peace talks with the Palestinian leadership. In public, Mr Netanyahu maintains he is committed to the pledge to work towards the creation of a demilitarised Palestinian state. But so far he has proved either unwilling or unable to renew even a partial freeze on Jewish settlement building in the West Bank.

Gideon Levy, a columnist for the Israeli daily Haaretz, last week declared Safed “the most racist city in the country”. The unflattering, and hotly contested, epithet follows an edict from Safed’s senior rabbis ordering residents not to sell or rent homes to “non-Jews” – a reference to the country’s Palestinian Arab citizens, who comprise a fifth of Israel’s population.