Michael Walzer nails it:
Why did he focus on the line about ’67 and pick a fight? There is a simple answer to that question: he isn’t interested in the peace process; he doesn’t believe that there is a peace process; he is thinking only of his political position at home. His speech to Congress was his reelection platform.
Walzer looks ahead to September:
Actually, if the Palestinians are smart, as they are these days, they won’t walk across the lines, for that raises the specter of return, and the right of return doesn’t (yet) have sufficient international support. Come September, after the UN recognizes their state, they will march inside the 1967 lines, thousands of them—from Nablus, say, into the nearby settlements and army bases, asserting their own sovereignty and territorial integrity. And what will Israel do then? Many Israeli rightists would, almost certainly, prefer a new terrorist campaign, which would put the Palestinians once again in the wrong. That is certainly possible, but it is, suddenly, less likely than peaceful protest.