Israeli Ambassador: Worst Crisis with U.S in Years

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JERUSALEM, Israel -- The Obama administration has unleashed a new round of harsh condemnation of Israel over its decision to build an apartment complex in Jerusalem.

Israel Ambassador to the U.S. Michael Oren is calling the dispute the worst crisis in Israeli-U.S. relations in 35 years.

On Sunday, White House Advisor David Axelrod became the latest member of the Obama administration to criticize Prime Minister Benjamin Netanyahu's government.

Click play to watch Chris Mitchell's updated report.  Get more reaction on Israeli-U.S. relations from Pat Robertson here.

"What happened there was an affront," Axelrod said. "It was an insult, but that's not the most important thing. What it did was it made more difficult a very difficult process."

"We've just gotten proximity, so-called proximity talks, going between the Palestinians and the Israelis," Axelrod continued. "And this seemed calculated to undermine that and that was distressing to everyone who is promoting the idea of peace and security in the region."

Relations in Jeopardy?

The incident began during Vice President Joe Biden's visit March 9. Israel's Interior Ministry announced it had approved plans for 1,600 new apartments in the eastern section of Jerusalem.

Netanyahu apologized for the timing of the decision, saying it was made by lower level bureaucrats.

By Thursday, Biden accepted the apology, declared the issue was behind them and said it was time to move on.

However, in a rare public diplomatic slap Friday, U.S. Secretary of State Hillary Clinton called the decision on the apartments "insulting" and made it clear the president himself stood behind her tough language.

She even hinted U.S. military support might be linked to construction in east Jerusalem, where Palestinians expect their future capitol to be built.

According to the Israeli press, Clinton demanded specific changes in Israel's policies, including cancelling the apartment project itself and freeing hundreds of Palestinian prisoners.

Fodder for Netanyahu's Enemies

Meanwhile, the Anti-Defamation League is calling the tone of the U.S. message "shocking."

In a statement, the group said, "We cannot remember an instance when such harsh language was directed at a friend and ally of the United States."

The U.S. criticism has given ammunition to Netanyahu's political enemies and strains his fragile coalition government.

Some Likud members feel Obama is "going after Netanyahu's head" since these demands are simply impossible for Netanyahu's coalition to meet as soon as the White House wants.

Netanyahu says the construction will not be canceled and that this project "in now way" hurts Palestinians.

Meanwhile, Sen. Sam Brownback is asking the Obama administration to stop what he calls "verbal attacks on our staunch ally."

"It's hard to see how spending a weekend condemning Israel for a zoning decision in its capital city amounts to a positive step towards peace," he said. 

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