That territory encompasses Israel proper, the disputed territories AND Jordan. Jordan is 75%-80% of "Palestine". Id there's any occupation it's the Jordanian. Through a defensive war and international recognition (acceptance into the UN) the Israeli Jews earned the right to Israel proper's territory; they also earned the right to purchase and settle the uninhabited portions of the disputed territories, notwithstanding Steven Argue's propaganda droning machine.

As for the theoretical question of where the Palestinians could go,-- if they get resume terror in earnest, I would say they should eventually go to the relatively vast country called Jordan; and if Jordan goes democratic on the heels of Iraq, all these Palestinians' rights would be guaranteed with no danger of Hashemite discrimination. Already a year ago I popped the idea of transforming Jordan into a constitutional monarchy, which might be the best way of saving face for the Jordanian monarch. Presently, all Jordanian Palestinians are still discriminated against and many still dwell there in refugee camps, even though Jordan doesn't deny them citizenship.

Now that Abu-Mazen at least seems bent on bettering the masses' lot and Israel has begun to lift part of the restrictions on Palestinian movement, it's up to the PA to take responsibility for their citizens instead of tossing and retossing it on Israel. It's the PA that owes them decent livelihoods, not Israel. Argue will obviously keep spewing his baseless nonsense here, but the Palestinians aren't being murdered and robbed.