Israel's Cabinet has made a controversial policy decision, following a Palestinian attack that left five people dead.
Israel has approved construction of hundreds of new homes in West Bank settlements, in response to a grisly attack on a family of Jewish settlers. An Israeli couple and three of their young children, including a baby, were brutally stabbed to death when Palestinian assailants broke into their home during the weekend in the Itamar settlement.
At the weekly Cabinet meeting, Prime Minister Benjamin Netanyahu accused the Palestinian Authority of talking peace, but inciting terrorism.
Mr. Netanyahu said the Palestinian government names city squares after terrorists who killed dozens of Israelis and gives financial support to the families of suicide bombers. He said that is not education for peace.
Palestinian Prime Minister Salam Fayyad condemned the attack on the settlement.
"We are talking about, in this particular case, an infant, two children and their parents," Fayyad said. "This definitely has to be condemned. That is always our position. We have always spoken against violence."
But the Palestinians also condemned the Israeli decision for new settlement construction on land they claim for a future state. They reiterated that they will not return to peace talks with Israel until all settlement activity stops.
The Palestinian Authority urged the international community to intervene and implement the two-state solution, saying that is the only way to end what it called the "vicious cycle of violence."