Ramat Shlomo: Inside the town that will test Obama to the limit

The US President wants the expansion of Ramat Shlomo to stop immediately. But its Jewish residents tell Donald Macintyre that the land was given to them – by God

Ask Rabbi Sam White what he thinks of the global political row over plans to expand the community in which he lives, prays and studies, and he answers bluntly: "I don't see the problem. God gave us the land of Israel." The notion that the location of Ramat Shlomo, on land occupied after the 1967 Six Day War and officially expropriated six years later, might belong to another people is wholly alien to the 32- year-old Salford-born rabbi. "There's no question. It's in the Torah, which says that God gave the land to the Jewish people."

We are talking in a gabled brown brick house which, incongruously set amid the rows of plain white multi-storey apartment buildings in this hilltop settlement of some 18,000 in the north of Jerusalem, looks as if it might have been transplanted from another country. Which in a sense it was. For this is the Chabad House, the community base of the famous Hasidic sect which still reveres the leadership of the late Lubavicher Rebbe Menachem Mendel Schneerson, its architecture a replica of the movement's world headquarters in Crown Heights, Brooklyn.

And Rabbi White is as opposed to territorial compromise of any part of the greater "land of Israel" – stretching, in his view, from the Jordan to the Mediterranean – as his spiritual leader was throughout his long life. "Look what happened in Gaza, when they took the people from Gush Katif [the main settlement bloc in the territory dismantled by Ariel Sharon in 2005]," he says. "An Israel in pieces is not an Israel at peace."

What Rabbi White cannot change, however, is that Ramat Shlomo is now ground zero of a trial of political strength between the Obama administration and the government of Benjamin Netanyahu. A trial triggered by the untimely announcement last week of a plan unveiled during the visit of the US Vice-President Joe Biden for 1,600 new homes on a long sliver of what is now green, wooded land on the south side of the settlement. On one persuasive reading, the US President is heading for just the same kind of fall he suffered when Mr Netanyahu last year refused to agree the total settlement freeze Barack Obama wanted to get negotiations between Israel and the Palestinians off to a healthy start.

But another reading, much more ominous for the Israeli hard right, and perhaps for Mr Netanyahu himself, is that the President has seen the crisis as an opportunity to redeem that defeat. And that he is – despite all the internal political risks posed by a fiercely effective pro-Israel lobby – this time determined to see it through because he has a clear understanding that an end to the conflict is not only an Israeli and Palestinian interest but an American one. In this he has now been publicly bolstered by General David Petraeus, head of US Central Command who bluntly told a US Senate hearing on Tuesday that unresolved Israeli-Palestinian tensions have an "enormous effect" on the operation of American forces in Muslim countries like Iraq and Afghanistan.

All of which may help to explain why Washington is now demanding not just the scrapping of the plan to expand Ramat Shlomo but a promise that any talks go straight to the "core" issues between the Israelis and Palestinians – including the future of Jerusalem itself.

Back in Ramat Shlomo itself, some considerations are rather more mundane. Nechani Rabinovich, a young mother wheeling her baby son Ezekiel in his pushchair, typically reflects Mr Netanyahu's political need to find relatively low cost housing to meet the rapid growth of large religious families. Mrs Rabinovich, whose parents have lived in Ramat Shlomo since its beginning in 1995 would like to buy a house – instead of renting – and to see many of her 11 siblings do so too. "If we had more houses it would be much cheaper," she explains.

But asked if she would divide "Greater Israel" to make peace, Mrs Rabinovich, 23, says: "I don't think this will bring peace and I don't think we have a partner." And if there was a "partner" would she relent? "No," she admits. "This is our land, our country. God gave it to us. There is no reason why they should take something that belongs to us." And what does she think about Mr Obama pressing Israel to abandon its plan for an extra 1,600 houses here? "I don't think he likes Israel. I don't think he likes Jews. I think" – she pauses here – "he is anti-Semitic."

The residents of this mainly ultra-orthodox neighbourhood, aware of its sudden unexpected fame, show none of the abrasiveness towards foreign reporters sometimes found in settlements established for more ideological reasons. But whether or not under the strong influence of Chabad, their views about the political future are notably hawkish, to put it mildly. Meir Margalit, a historian, human rights activist and member of the Jerusalem municipality for the left-wing Meretz party says the orthodox community have become progressively more right-wing in recent years. "It is part of a process of fundamentalism happening to religious communities, especially in Jerusalem," he says. And in this respect the Ramat Shlomo residents are a kind of grass roots microcosm of the right-wing elements in Mr Netanyahu's coalition, one which could well break up if the Israeli Prime Minister backs down in the face of US demands.

Local grocery store owner Rafael Niasov, 45, is no exception. He too cites the Torah and argues that Jews have inhabited the land of Israel for "5,500 years". Explaining that he came from Uzbekistan at the age of eight, he says: There we lived side by side with Muslims. We had good relations, we were like family. But these [the Palestinians] are savages." On one point he disagrees with Mrs Rabinovich "I don't think Obama is anti-Semitic," he says. "He wants to make his place in history like Reagan, Bush, Clinton, the son of Bush; they all tried and now Obama's trying. But it won't help him. In the Torah it is written that there will be no peace. Obama is living under an illusion. We will continue suffering until the Messiah comes."

The question of whether Mr Obama, as Mr Niasov clearly thinks, is heading for another failure is still open. Mr Netanyahu has argued that there is a wide Israeli "consensus" – even on the left – that "neighbourhoods" like Ramat Shlomo, close to the larger Jewish settlement of Ramot and a hi-tech Israeli business park, Har Hotzvim, as well as the Palestinian districts Beit Hanina and Shuafat would remain in Israel under a two-state solution.

Danny Seidemann, a Jerusalem lawyer and campaigner for a shared capital in the city, points out that 1,600 homes in Ramot is more than Israel has built for Jerusalem Palestinians in 43 years of occupation. But he accepts that – assuming a just land swap – that such a consensus exists. However he adds: "The status of Jerusalem will be determined not by Israeli consensus but by an agreement with the Palestinians. If I as an Israeli want Ramat Shlomo to be part of Israel, the only people that can give it to me are the Palestinians. The borders have to be determined by negotiations, not by settlement activity."

Which may go to the heart of why the US appears to see – at least for now – a halt of the Ramat Shlomo project as one necessary token of good faith to begin negotiations. And why, unlikely as it seems, this quiet Jewish suburb on the Palestinian side of the green line which was Israel's border until 1967 may have become the greatest test of the Mr Obama's international statesmanship to date.