If Prime Minister Benjamin Netanyahu backs off of building new housing developments in East Jerusalem, his government will fall.
Because the Prime Minister doesn’t want to have his government fall, he won’t back off in response to the Obama Administration’s public denigration efforts.
If the Obama Administration wants to convince the Prime Minister to back off, they will have to use private diplomacy, and throw a sweetener into the deal in order to make it easier for the Prime Minister’s government to survive.
Eric Cantor seems to know this, which is why his advice to the White House to back off in public ought to be listened to. Whether it actually will be listened to is an open question; as the Obama Administration has made clear in a little over a year in office, its actual ability to do foreign policy right is not nearly as great as was advertised during the 2008 Presidential campaign.