He is right, but must take further steps.
Every society has its criminals, it's extremists, and it's potential terrorists, that need to be reigned in. The tragedy is that extremists and extremism, destructive to Israel no less than to the Palestinians, have not been reigned in, in spite of more than enough warnings and terrorist acts, such as the assassination of PM Rabin. No, they have been allowed to lead the way, leading government policies astray.
Negotiations with the Palestinians failed, no less because of the Palestinians than the Israelis. They will hopefully be resumed, but even prior to this, PM Netanyahu has to do the following (or similarly):
- Declare the small area along the 1948 ceasefire line in which 80% of settlers live (and which in any peace agreement will be part of a land swap) to be part of Israel,
- Declare a complete settlement freeze beyond this area, where the majority of settlements, in which however a minority of settlers live; offer settlers who are willing to evacuate the possibility of compensation; the earlier they evacuate, the greater the compensation; at the end of the process, the settlements will be relocated into the remaining settlement blocs (state funds thus saved should be channeled to affordable housing for the young inside Israel),
- Declare willingness to swap land for the areas held on to, at a future negotiated peace agreement, but not until then,
- Unlike the full withdrawal from Gaza, military occupation (for instance to ensure that rockets are not fired from the West Bank into Israel’s Ben Gurion International airport) will remain until security arrangements and partial or full peace agreements are reached – only the civilian aspects of occupation, that is the settlements, will be evacuated until such times,
- Declare recognition of an Arab Palestinian State, whether independently in the West Bank and Gaza, or in (con-)federation with Jordan, and the willingness to establish joint financial and other projects to make such a state viable, in whatever shape the Palestinians themselves decide.
The above as an intermediary prior to the resumption of negotiations, and in order to reign in Jewish extremism, that threatens the fabric of Israeli society more than an external enemy can ever do.