While Israel and its supporters have welcomed Richard Goldstone's retraction of his scathing false accusations against Israel and its army, I think that there is an important side to the story being largely overlooked: Palestinian reaction.
Obviously, Hamas roundly condemned any retraction and implored the UN to act based on Goldstone's initial report. That same report also castigates Hamas with war crimes, but Hamas' hypocrisy can be overlooked because it knows it is not subject to any UN pressure (despite the fact that the UN is the biggest employer and provider of services in Gaza).
More important is the reaction coming from the less violent wings of the Palestinian Arab population, namely Mustafa Barghouti, the so called 'third way' candidate, supposedly most amenable to peace with Israel, and Yasser Abed Rabbo, a PLO and Fatah VIP who was Yossi Beilin's partner in drafting the Geneva Initiative. Why wouldn't supposedly peace-loving Palestinians want to exonerate Israel, so that their population will be more supportive of their former declarations of peace?
The obvious answer, clearly, is that no one was really interested in selling the idea of peace, or that the IDF could make a good neighbor, to the Palestinian street. While every Israeli household received a copy of the Geneva Initiative no such distribution was done in Arab communities in Yehuda, Shomron or Azza. Palestinian overtures were only made towards Israel for Israeli consumption, and to dupe Israelis into thinking that giving away their land would guarantee peace. The furor which erupted over the so-called "Palestine Papers" was also based on the fact that the average Palestinian had no idea of even which potential compromises their leaders were being asked to make.
Since the PLO stopped negotiations with Israel, using Operation Cast Lead as an excuse to cover up the unbridgeable gaps between Olmert and Livni's concessionary offers and Abbas' intransient demands, it has been obvious to close observers that the PLO intended to act unilaterally against Israel through the UN. On March 20th, Saeb Erekat, the chief non-negotiator, announced this officially.
Israel's goal now has to be not only to show that its army acted justifiably against Hamas, but that Fatah and more moderate-sounding factions are just as willing as Hamas to incite against Israel, and are as unwilling as Hamas to negotiate a peaceful settlement.
The original platform for negotiations was the concept of "Land for Peace." The international community must understand that with the thorough PLO rejection of peace, there is no reason to entertain that Israel should depart from any of its land.