In 2004, US President George Bush, in exchange for then Prime Minister Ariel Sharon’s plan to withdraw from the Gaza Strip, wrote a letter saying in any future agreement between Israel and the Palestinians it would be “unrealistic” to expect a full Israeli withdrawal to the 1949 Armistice lines (the 1967 lines), and that a just and fair solution to the Palestinian refugee issue would be their absorption in a future Palestinian state, rather than Israel.

What prompted Prime Minister Netanyahu to issue a surprisingly harsh response to President Barack Obama’s speech Thursday night was the sense that Obama had essentially thrown that letter out the window.

There were three elements in the Obama speech — a speech which was not without some “sweeteners” for Israel — that particularly irritated and surprised Netanyahu.

The first had to do with the President using, for the first time, the 1967 lines as a baseline for an agreement, saying in his speech that “We believe the borders of Israel and Palestine should be based on the 1967 lines with mutually agreed swaps, so that secure and recognized borders are established for both states.”

Using the 1967 lines as a baseline, and saying that land will have to be swapped from inside Israel, has never before been US policy.

In 2009, in a carefully worded statement, US Secretary of State Hilary Clinton said the following: “We believe that through good faith negotiations the parties can mutually agree on an outcome which ends the conflict and reconciles the Palestinian goal of an independent and viable state based on the 1967 lines, with agreed swaps, and the Israeli goal of a Jewish state with secure and recognized borders that reflect subsequent developments and meet Israeli security requirements.”

What Obama did in his speech was make the Palestinian goals of a “viable state based on the 1967 lines, with agreed swaps,” the American goal as well.

Although the 1967 lines may have been the implied baseline in the Bush letter, there was no hint there of a need for Israel to compensate the Palestinians fully for all territory taken in the Six Day War. In fact, Bush wrote that Israel must have “secure and recognized borders” emerging from negotiations based on UN Security Council Resolutions 242 and 338. UNSC Resolution 242 famously calls for an Israeli withdrawal from territories taken during the war, but not all the territories.

In Netanyahu’s mind Obama is charting new and dangerous territory, something that cannot be ignored or whitewashed. Or, as he said as his plane was just about to land in Washington Friday morning a few hours before his planned meeting with the President, “some things cannot be swept under the rug.”

The second issue that perturbed Netanyahu was the refugee issue.

While Bush in his letter said clearly that the Palestinian refugees should return to a Palestinian state, Obama made no mention of that position and instead actually said that the refugee issue would have to be negotiated down the line. In the Israeli view, Obama simply ignored the American policy articulated by Bush on the refugees.

With Palestinian “refugees” storming the border fence in the north demanding the “right of return,” the concern inside the PMO is that Obama’s failure to take a firm stand on the issue only reinforces the Palestinian belief that there is actually something to talk about on this issue. “This is a basic misunderstanding of the reality,” one PMO source said.

And the third issue that rankled Netanyahu had to do with Hamas. While Obama said the Hamas-Fatah reconciliation raised “profound and legitimate questions for Israel,” for Netanyahu this was simply not a strong enough statement. The PMO saw Obama as “wishy-washy” on Hamas, and at the very least wanted to hear Obama reiterate the Quartet’s three conditions for engagement with Hamas as part of a PA unity government: forswearing terrorism, recognizing Israel and accepting previous agreements.

That Obama made no mention of these conditions, and that he did not clearly and unequivocally reject Hamas’ participation in a PA government, sent — at least in Netanyahu’s mind — exactly the wrong message.