Advantage, Netanyahu. Haaretz reports today that George Mitchell, President Obama’s special envoy to the Middle East, has dropped the administration’s insistence on a permanent settlement freeze in East Jerusalem, recognizing that it is unfeasible. Although Mitchell said he won’t endorse settlement building in that area, the part of the capital considered Palestinian territory, he also said he won’t continue to demand a public announcement from Netanyahu that such building will be halted (the Israeli prime minister has offered as a compromise a nine-month freeze in construction).

This news comes just after Palestinian sources said Palestinian Authority President Mahmoud Abbas would meet, albeit informally, with Netanyahu at the upcoming U.N. General Assembly, and P.A. Prime Minister Salam Fayyad’s announcement that the West Bank would become a “de facto state” by 2011, based on its progress on development and security.

U.S. Drops Demand for Israel Building Freeze in East Jerusalem [Haaretz]