I strongly recommend this article at Zeek magazine on the current debate between Israel and the US on natural growth, what a settlement freeze could mean and what next steps Obama needs to take. The author writes further on the point at his blog here.
Great Article On the “Natural Growth” Argument
June 22, 2009 by Mitchell Plitnick
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The argument that “natural growth” is essential to Israeli wellbeing is false. But it is also falacious to make that the issue.
Zealot Israelis believe that the area rightfully and legally belongs to Israel and therefore they should need no excuse for building on it, as they so please.
There is no international tribunal capible for with proper jurisdiction to adjudicate this dispute. Why? Suppose for example that the United Nations voted and adopted a resolution that Texas legally belongs to Mexico? Suppose further that the World Court affirmed? Would the USA be obliged to surrender Texas to Mexico?
If the Palestinian-Arabs were serious about making peace, they would use the considerable leverage they have (some of it quite unfair) to get the best deal they could at the negotiating table, which might well include parts of these disputed zones.
the rest of the argument is gas.