Israeli Prime Minister Ariel Sharon and President George W. Bush, following their sixth meeting in 15 months, agreed this week that reforms promised by Palestinian President Yasir Arafat to provide security for Israelis were insufficient to warrant renewed peace talks.
A day later, a roadside bomb injured three Israeli teenagers and a Palestinian suicide bomber killed a 15-year-old girl and injured nine others.
"No one has confidence in the emerging Palestinian government," Bush said after an Oval Office meeting with Sharon.
Sharon insisted that a prerequisite to peace talks is a "full cessation of terror hostilities and incitement."
[A new video on Palestinian Authority television Monday depicted Sharon as a Nazi attacking a young Palestinian boy with an axe, according to Palestinian Media Watch.]
Sharon added: "We must have a partner for negotiations. At the present time, we don’t see yet a partner."
Meanwhile, Israeli troops who moved back into Ramallah hunting for terrorists (there were more than 60 arrests) discovered two parked cars filled with explosives in the center of town similar to the one that last week was used to blow up an Israeli bus, killing 17.
Palestinian Information Minister Yasir Abed Rabbo, furious that Bush appeared to give Sharon a green light for the military excursion, called for an emergency Arab summit to address the "total American bias" in the conflict.
"This is proof that this is an administration that cannot be trusted," he told the French news agency. "They have violated all their commitments and promises to the Arabs."
With no political progress on the horizon, analysts were glum about prospects for peace.
"I’ve never been as pessimistic about the possibility of ending the bloodshed and finding a reasonable resolution," said Henry Siegman, a senior fellow at the Council on Foreign Relations.
Reuven Hazan, a political science professor at the Hebrew University of Jerusalem, said that as long as Arafat continued to head the Palestinian Authority, "there is little likelihood that there will be anyone on the Israeli side willing to enter into serious negotiations with him."
"An agreement with Arafat is probably a contradiction in terms right now," he said.
Although Arafat reduced his cabinet from 31 to 21 members and appointed an Interior Minister to oversee security forces, the steps appeared meaningless, according to David Makovsky, a senior fellow at the Washington Institute for Near East Policy.
"There is no indication that … it will mean a reorientation of the Palestinian Authority," he said. "If there is no peace conference around which to focus on a grand deal, and no Palestinian willingness to do anything less than a grand deal, and no [Palestinian] political will to stop the attacks, it’s hard not to reach the conclusion that this period of violence will continue."
Dore Gold, an adviser to Sharon, said that in the absence of political dialogue all the Sharon government could do to provide security for Israelis was to use "offensive means to break the terrorist infrastructure."
That move has been coupled with the establishment of defensive security zones. Contractors this week broke ground for the first phase of a security fence separating the northern part of the West Bank from Israel. The entire fence is expected to take three years to complete (see story on page 33).
The Israeli daily Haaretz Wednesday said in an editorial that this period should realistically be viewed as an "interim one in which the main effort will be to manage and control the conflict while taking defensive steps such as the security fence.
"Above all, it is important during this period to avoid escalation of any kind, particularly with regard to necessary military operations, which should be as brief and as limited as possible to avoid unnecessary friction."
Aides to Sharon reportedly said the prime minister is still considering expelling Arafat from the territories but that he did not broach the subject in his meeting with Bush.
Makovsky cautioned that there are good arguments on both sides of that issue.
"I think it’s important that those who believe such a step should be taken see the genuine short- and long-term benefits and not take the step merely because it is the ‘do something’ option," he said. "There are no guarantees in life, but you have to have a reasonable belief it would succeed."
A senior Israeli military officer was quoted by The New York Times this week as saying that even in exile, Arafat’s influence would be "strong enough to prevent any grass from growing up." He said Arafat’s position was bolstered by Israel’s recent military offensive.
Both Sharon and Bush reportedly agreed in their Monday meeting not to concentrate on Arafat at this time but rather to press for reforms of the Palestinian Authority that would diminish Arafat’s role. And Bush agreed with Sharon that the time is not right to set a timetable for reforms or for the start of a regional peace conference.
But in a later interview, Secretary of State Colin Powell was quoted by the London-based Al Hayat newspaper as saying in an interview that Bush was considering the establishment of a "temporary" Palestinian state before final-status talks begin. And he said the U.S. still planned to convene a Middle East peace conference this summer.
Zalman Shoval, an adviser to Sharon, said the idea of a temporary Palestinian state "won’t fly … Israel will not agree."
Regarding the peace conference, Shoval recalled it was Sharon who proposed the assembly. Shoval said Israel, the U.S. and the Arab states that attend would first have to develop an agenda before a conference could be convened.
"There is a wide gap between the Arab approach and the Israeli approach," Shoval said. "The Arabs speak about agreeing on the establishment of a Palestinian state early on (within months or a year) on 40 to 45 percent of the territories. After that, they would negotiate other things like borders, the future of Jerusalem, refugees.
"Israel’s attitude is that once you recognize a Palestinian state, the whole negotiating process becomes a lot more difficult. … Far-reaching reforms should precede the establishment of a state because if you have the same leadership it would be like shuffling marked cards … they’re still marked. The result would be another rogue dictatorial state in the Middle East."
Bush in his press conference with Sharon said he was looking for the Palestinians to make reforms in four areas before conditions would be ripe for a ministerial summit: security, economic transparency, anti-corruption steps and a rule of law enforced by a court system.
Hazan said the Palestinians would have to take "concrete actions to regain the support of the Israeli public."
"If there is a younger Palestinian generation [that succeeds Arafat] and is willing to move ahead [with reforms], Israelis would be willing to make concessions," he said. "It is quite possible Israel would go back to the 1967 borders but it is impossible with Arafat.
"Most Israelis do not support the settlements and do not wish to subjugate the Palestinians. They would make concessions if there was viable, credible security and Arafat was not present anymore."
However, polls released this week found hard-line positions among both Israeli Jews and Palestinians.
One poll found that 56 percent of Israeli Jews opposed returning to the 1967 borders in return for a peace agreement with the Palestinians and the Arab world. And only 4 percent agreed to return to the ’67 borders when the question specified the need to give up the Golan Heights, the Jordan Valley and the Old City of Jerusalem. The poll of 501 Israelis was conducted by Smith Research.
A Palestinian poll released this week found that 79 percent of Palestinians supported violence and that 51 percent believed the objective was the destruction of Israel. The poll of 1,179 Palestinians by the Palestinian Jerusalem Media and Communications Center found also that 68 percent approved of suicide bombings against Israeli civilians.
Palestinian attitudes were largely unchanged in the last six months, the poll found.
Hazan pointed out that amid Israel’s security concerns, the country was also facing what he called "dire economic straits."
"In the last two weeks, the interest rate has been raised 2.5 percent but the Israeli currency continues to decline," he said. "If the decline continues, Israel will not be far from Argentina when it comes to a probable economic collapse."
But Harry Langman, chief fiscal officer for the Israeli government in North America, termed that assessment an "exaggeration" and noted that the bond rating agencies have not downgraded Israel’s credit rating. Moody’s still posts an A minus credit rating.
Langman said the Knesset last week approved an economic reform package that cut more than $2 billion from the budget and that a tax reform package has been submitted for implementation next year that would further shore up the Israeli economy.
"The markets today stabilized," Langman said Wednesday, noting that the shekel was holding at about 5 to the dollar.
He noted that the governor of the Bank of Israel and the minister of finance met Wednesday to develop a joint strategy and suggested that this meeting would also help bring about stability.
"We’re taking steps that will calm down the markets," Langman said, adding that it was now unclear whether another proposed 2 percent hike in interest rates at the end of the month would be necessary.