Well, my best possible solution would be worldwide socialism. :) Short of that, I believe the most just solution is one secular state with constitutional provisions in place to guard against any one ethnic group getting too much power. It's not the sort of thing that I expect to see in my lifetime, though it's a possibility, since the fragmentation of Palestinian territory has eliminated the possibility of the classic realistic solution (which is a return to the 1948 UN-established partition plan or some variation thereof).

But I'm not arrogant enough to think I get to decide these things. I'm a Jew living in Canada, and I have the privilege to turn my back tomorrow and pretend none of this shit is happening. It's up to the people living there to develop a workable solution. Western interference so far has only caused a clusterfuck.