Trump proposes Palestinian state with capital in East Jerusalem

By Steve Holland WASHINGTON (Reuters) - U.S. President Donald Trump on Tuesday proposed creation of a Palestinian state with a capital in East Jerusalem, dependent on Palestinians taking steps to become self-governing, in an attempt to achieve a peace breakthrough in their decades of conflict with Israel. Senior administration officials, briefing Reuters on the details of a plan the president was due to announce at the White House at mid-day, said that under Trump's proposed Middle East peace plan the United States will recognize Israeli settlements on the occupied West Bank. In exchange, Israel would agree to accept a four-year freeze on new settlement activity while Palestinian statehood...