call with netanyahu, clinton commanded israel reverse its decision on the settlement project and take concrete steps to prove it wants to negotiate with palestinians. >> she asked for a former response by the israeli government and we await that response. >> reporter: israeli officials tell cnn jerusalem is debating what steps to take to defuse the process. netanyahu stood his ground calling the timing of the announcement regrettable and hurtful. he says settlement building will not stop. the spat is stirring up a horn et's nest on capitol hill. >> didn't have thep to be public disparagement on the secretary of state. >> reporter: a matter of serious concern and distraction from important issues like middle east peace and iran. the liberal j street termed it