MR. FREEMAN: I haven't been in this particular room before. My experience with it is that the acoustics are somewhat difficult, and therefore if you have trouble hearing, I suggest you just move around in the room and you'll find a place where you can probably hear more than you want to.

Well, it's about 9:30 Arab time, so why don't we get started. I am in shirtsleeves, and anyone who feels more comfortable that way, please feel free to relax. I am Chas Freeman. It is my honor to be president of the Middle East Policy Council, which is a small struggling organization that does three things. First, we come up here to Capitol Hill, and with the help of the members of Congress we hold a discussion of some politically incorrect, awkward, embarrassing or exceedingly difficult set of issues that are not getting in our view a full and fair treatment, and we try to provide a full and fair treatment. We pose the questions. We assemble a distinguished panel with different views to address those questions, and then we open it to the audience.

The transcript of these sessions is always posted at our website, and it becomes the first item in the second thing that we do, which is publish Middle East Policy, which I am proud to say is the most often-cited journal in its field, and which is distributed by Blackwell commercially.

And, finally, the last thing we do, beyond the Beltway mainly, but I think perhaps most significantly, is a train high school teachers how to teach about Arab civilization and Islam. We have trained some 13,000 teachers to date, which means that we confuse about a million kids a year with a fact or two that they otherwise would never have encountered -- all very worthwhile, I think.

In any event, this session today is part of our regular series of discussion of interesting topics, and we are here today, as you know, to talk about the crown prince of Saudi Arabia, Prince Abdullah bin Abdulaziz's peace proposal, and whether it is an offer or an ultimatum.

Whatever it is, it certainly was historic, and it's very unlikely that any other Arab leader at present would have had the stature in the Arab world or the Islamic world to make the proposal that Abdullah did. That proposal, as summarized by his Royal Highness Saud al-Faisal, the foreign minister, in Beirut is simple: complete peace for complete withdrawal. That is to say Saudi Arabia through the crown prince offers peace and normal relations with Israel -- not just on the part of the kingdom, but on the part of all Arab states, in return of Israel's negotiation of mutually satisfactory peace arrangements with Israel's neighbors.

This is also the first time that a ruler of Saudi Arabia, to my knowledge, has communicated or has sought to communicate directly to the Israeli people. That this was the purpose of the peace proposal is clear, and that it continues to be its purpose is equally clear, as the Saudis engage in extensive polling in Israel for the first time in an effort to try to understand the shifting kaleidoscope of Israeli opinion and response to events and to the peace plan.

It is also clear, however, that the crown prince's proposal is not a road map but a destination. It is a reward for success in bilateral negotiations between Israel and Palestine, between Israel and Syria, and ultimately Israel and Lebanon. It does not say -- it does not attempt to specify how those negotiations should proceed, and it has left open the question of how Israel and its neighbors might get to the destination that would justify the reward. In fact, since the crown prince's proposal, the discussion has been dominated by the question of tactics and how to get there. Will Israel in fact accept this vision of the crown prince is uncertain. Will Israel seek to impose a solution or to negotiate one also remains uncertain.

But there are two clear trends. The first is a clear -- the emergence of clear differences in discussion of the road map of how to get to peace. Some say that first the Palestinians must halt their violence resistance to the Israeli occupation. Then the Palestine Authority must be reformed so that more acceptable leaders are there with whom to negotiate. And, third, discussions could then begin about the Palestinian state and its contours.

Others -- this is one two three -- others reverse the order. First there must be a Palestinian state because only a state can bind all Palestinians to an agreement. No movement, no political party, can speak for everyone. Then there must be reform of the Palestine Authority in order to make the government of that state effective, responsible, accountable, and to make the state viable. And finally, there must be an end to the violence in the context of the negotiation of agreed borders, frontiers, and relationships between Israel and the Palestinian state. So three, two, one vies with one, two, three as the framework.

The second trend is that there is rising pressure within the Arab world, and especially within Saudi Arabia, on the crown prince to retract his peace offer. And to show its flip side, if complete peace is offered for complete withdrawal, then it is clear that many see the flip side as escalated confrontation with Israel, including perhaps the collapse of the Camp David framework in return as an answer to recalcitrance and unilateralism on the part of Israel. It is also clear that the crown prince has paid a very high political price for his courage in putting forward this proposal. This is nowhere more clearly evidenced than in the unprecedented assertion of political power by Saudi women against the wishes of the government, and something that has not been reported, in the Western press at least, an extremely effective consumer boycott of American products, engineered by Saudi women behind the back of and over the opposition of the Saudi monarchy.

This raises questions of course also about the broader Arab context of this proposal. How long can it remain on the table? Is it a sustainable offer? Is its flip side about to show itself or not?

Here to discuss these and other issues which are I think of vital importance to anyone concerned with the Middle East, we have a very distinguished and able group of people. I am not going to read all the biographic information because if you have the program it is on the back of the program. We will proceed in the order stated on the front, which is I will call first upon Mamoun Fandy, who is professor of politics, at the Near East South Asia Center for Strategic Studies at the National Defense University and someone who follows opinion in Saudi Arabia politics in Saudi Arabia and the Arab world more broadly very closely.

Mamoun will be followed by Ambassador Ned Walker, a colleague who is the president of the Middle East Institute, our sister organization with which we are very pleased to be able to cooperate. MEI steals some of Ned's thunder. MEI is a membership organization that fosters policy discussions amongst its members, provides a forum for visitors to address those members and others, publishes an excellent scholarly journal called Middle East Journal -- has a research library which is unique, and which teaches Arabic, Farsi, Hebrew and Turkish to the public. And we are very pleased that MEI's activities complement our own and do not overlap with them, enabling us to cooperate, as we are today.

Third, we will call on Ofer Grosbard, whom I just met, and who is now finishing a doctorate at George Mason University, but is a clinical psychologist with a degree from Tel Aviv University who has taught in Israel and done a lot of work in psychodynamic dialogue between Jews and Christians, and who is working now -- his doctoral piece, I should say, is on conflict resolution, which is very much to the point.

And finally, we will hear from Michael Hudson, who is professor of international relations and Seif Ghobash professor of Arab studies at the School of Foreign Service in Georgetown University, and who probably needs no further introduction to a knowledgeable audience in Washington.

Let me call now on Mamoun. I should add, for those of you who are not familiar with the procedures here, that everybody gets about 10 to 12 minutes, and if they begin to exceed 12 minutes I will physically eject them from the panel. So you will see me begin to move ominously in their direction if they go on too long. Fair warning. You know about it.

MAMOUN FANDY: I know about it. I’ve been there.

Good morning. It's very difficult practically to talk after Ambassador Freeman always, because he covers all the issues and then asks us to repeat covering them again in a more pedestrian way.

So I was asked to talk about the initiative of Crown Prince Abdullah that the ambassador described, with quoting Prince Saud Faisal an on initiative that is based on peace for withdrawal.

The crown prince's initiative is something that is extremely significant, and what I would like to do just before the discussion is to let you know what it is after it was adopted by all Arab states March 28th, in the 14th Arab Summit in Beirut. And the basic ideas concerning this initiative were that the Arab states were to call upon Israel to affirm a full Israeli withdrawal from all the total system territories occupied since 1967, including the Syrian Golan Heights to the lines of June 4th, 1967, as well as the remaining occupied Lebanese territories in the south of Lebanon.

They also asked for a just solution to the Palestinian refugee question on the basis of Resolution 194. There is also a request for the acceptance of the establishment of a sovereign independent Palestinian state on the Palestinian territories occupied since the 4th of June 1967 in the West Bank and Gaza, with East Jerusalem as the capital.

Consequently, the Arab states will do the following. One, consider the Arab-Israeli conflict to be completely over; and two, to establish normal relations with Israel in the context of comprehensive peace. And they also called upon the government of Israel and the Israelis to accept this initiative in order to safeguard the prospect for peace and stop further shedding of blood in the region. These are the key issues. If they were described as peace for withdrawal, I would probably describe them as normalization for normalization: that the Arab states practically were asking Israel to be a normal state. As a result, they would normalize their relationship witch Israel -- economic and culture and otherwise.

We know that normal states are clearly defined in terms of borders. They have very fixed and clear borders. They do not occupy or invade or -- normal states are normal states. So for the Arabs, Israel has to be a normal state in the region with clearly defined borders, with no occupation of other people's land. In return they will have normal relations with Israel. This is a broad Arab position that reflects a choice on the Arab parties that they chose peace as the strategic choice in the region.

The specialness of the crown prince's initiative comes from probably two things: one, the man and the state. Crown Prince Abdullah is known from probably Marrakesh to Bangladesh, throughout the Muslim, world as a man of integrity. There is very little criticism of Crown Prince Abdullah in terms of either issues of corruption or issues that are related to his personal life. He is a man who is admired throughout the region. He is also known to be a straight shooter, a man -- a Bedouin man with a clear head and clear vision, and what you see is what you get. He's well respected as probably the key Arab figure who enjoys a lot of respect throughout not just the Arab world, but also the Muslim world.

Also, the crown prince right now is managing a state that is most important in the Muslim world. Saudi Arabia is the seat of the Muslim world. It's the place where the holy sites of Islam are concentrated. The birth of Islam is in Saudi Arabia. So Saudi Arabia is a state with an amazing reach in the Muslim world, and capable of convincing not only Arabs, but bringing Muslims along to accept whatever deal that the Saudis will accept.

It was very obvious at the beginning had this initiative came from any other party it would have been probably doomed. But the success of Crown Prince Abdullah and the skillfulness of Saudi diplomacy managed to get unanimous consent for that initiative in Beirut, including -- of all countries -- Iraq -- even Iraq signed on that treaty, that initiative.

It is very important to remember that most people here in the United States in that spirit of World Cup sometimes miss great events that take place in the world. There is a big World Cup taking place right now, but very few of us know. The whole world is engaged in an event, but we don't know much about it. The same goes for the crown prince's initiative. It was a very big event in the Arab world for both the man and the state. Saudi Arabia is known to be a cautious, conservative, status quo power. But finally it put its neck on the line for peace in the region.

The Saudis decided, probably like most Arab states -- Egypt did in 1977 -- that the key for stability in the Arab world are two concepts. The first concept is peace as an organizing concept that regulates relations among states in the region, and internal reform that will regulate relationships between states and their societies. And if one looks at the record of Crown Prince Abdullah, one can see that indeed two concepts are at work: There is an internal reform that is regulating the relationship between the state and its society, and there is also a commitment to peace. And that commitment is very obvious. He brought all the Arab states along with him. People who have the wrong focus on this initiative, or the detractors of the initiative, focus on the issue of is it an ultimatum, or is it really a serious initiative? I think Prince Saud al-Faisal gave an interview -- probably to ABC News -- which was April 28th, after the crown prince's visit to Texas, and responded to these remarks by saying there was media speculation that the crown prince was pressing for one thing, and the president was pressing for another. He said this was not -- this was a discussion between friends -- and threats are no way to discuss things among friends. God knows we have enough threats in the region.

Everyone wanted to present this as Saudi Arabia threatening the United States, and they talked about Saudi Arabia will use oil as a weapon. The reality is since April nothing happened. Saudi Arabia did not use any weapon.

In the case of Saudi Arabia the Washington community is -- these are threats -- (laughter) --

MR. FREEMAN: Backed up by the use of force.

MR. FANDY: Usually -- concerning Saudi Arabia, the amazing thing about Washington is that it always gets it wrong about Saudi Arabia. And probably that's the solid conclusion that one can come up with. It has always been whenever there is a crisis -- 1990 and '91 -- everybody told us that Saudi Arabia would crumble. Somebody else told us Saudi Arabia is mired in problems. But Saudi Arabia for the last probably 80 years or so people have been making wrong predictions about it. And I conclude by saying that those who think that the crown prince's initiative is an ultimatum, they are yet making another wrong conclusion. Thank you.

MR. FREEMAN: Thank you very much, Mamoun -- succinct summary of how the crown prince's proposal and some of its context for which I think we are all very grateful. It nicely sets the tone for further discussion.

I would say -- before asking Ambassador Walker to take the podium -- that usually Middle East Policy does not publish documents -- that's not really our role -- but we have published in this latest issue the full text of both the crown prince's remarks at Beirut and the Arab summit declaration on peace. And I urge you to read those because it's remarkable how many people are able to provide detailed analytical interpretations of these proposals but have never actually read them.

EDWARD S. WALKER: Well, thank you very much, Chas, and thank you for saving me the time, and all of us the time, of having me talk about the Middle East Institute. We are sister organizations and do work closely together.

Well, first let me start with I think that it is wrong to characterize what the Saudi crown prince did as a plan. It is not a road map to peace. It is a sense or a vision for the -- primarily addressed to the Israeli people. That was its original intent. And it was -- the idea was to give them a sense that indeed if we can get to peace – if we can get to peace, there will be acceptance in the Arab world, there will be recognition. This is based on the premise that this has been one of the long-standing Israeli fears -- one of the basic fears -- that we will make peace and then they will continue to seek the destruction of the state of Israel. That's a continuing fear in Israel. It's still there, and there's lots of reasons for people to believe such a thing. The crown prince was trying to answer that question.

Then he took it further. He took it to the Arab world, and he took it up to Beirut. Now, I was in touch with a number of the participants in the Beirut process that went on. This was not easy. For the Arab world to come together, when it includes rejectionist states, and to say, yes, that if there is peace we will recognize Israel -- we will have normal relations with Israel -- was an astounding accomplishment on the part of the Saudi crown prince.

If you think back in time a bit, and you remember that it was -- well, quite a few years now ago -- that the Arabs got together and said in Khartoum that there would be no peace with Israel, there would be no recognition and so on, and if you think back to the way King Faisal talked about the issue and said that Saudi Arabia would -- that if every Arab state recognized Israel, Saudi Arabia still would not. And then that policy evolved to Saudi Arabia will be the last to recognize Israel -- this is truly revolutionizing on the part of the crown prince.

Now the question that was raised by Chas on the -- was this an ultimatum or is it an offer -- well, I disagree with my friends. It's both. And I'll tell you why it's both. It's an offer to the people of Israel. But in reality it's an ultimatum to the rejectionists. This is a plan that the Saudi crown prince has put out there to say in effect rejectionism is over. We as Arabs cannot accept the rejectionist program any more. That has profound implications for things like Hamas, Palestinian Islamic Jihad, Syria, Iraq, ultimately Iran and so on.

We were slow, I think, in trying to embrace this as a country. We should have welcomed it with open arms. Now, there are a lot of people who will psychoanalyze why the crown prince did this, and I think there are many good questions that could be asked. We know that the Saudis were feeling pressed because of the participation of Saudis in the September 11th issue. We know that they were concerned about their stature and status in the Arab world and in the United States and the West. These are all motivations presumably. But the reality is it doesn't much matter why this took place. What matters is that it took place. We haven't sat down and asked ourselves, why did Sadat go to Jerusalem. What -- you know, the result was the important thing, and I think the result here is the important thing.

I just was out in the region, and I was over -- I talked to the crown prince -- I went through Saudi Arabia, talked to a lot of businessmen. And Chas is absolutely correct: this was not a popular move in Saudi Arabia. This crown prince was criticized for it. The atmosphere there is very negative. The atmosphere towards the United States is very negative, towards the administration. There is enormous frustration. And this is particularly true among the younger people in the region, but particularly in Saudi Arabia.

There is the beginning or the feeling that the United States has completely identified with Israel. I think that's wrong, but that's what the feeling, the impression is. And so therefore there is a hostility that is growing about the United States.

This was the background on which the crown prince made his proposal. And I would add another thing: this was solely his initiative. This was not something that he went through with a fine-tooth comb, with all the other princes and so on. In fact, Prince Sultan was out of the country when this was announced. So this is the courage of one man, and the vision of one man. And I seriously doubt that he is going to back away from this. That certainly was not the impression I got when I was talking to him just two weeks ago.

He was deeply impressed with his visit to the United States. He was impressed with his discussion with President Bush out in Texas, in Crawford. He was waiting to see what we are all waiting to see, next week's announcement of the direction the United States is going to take. But he was very firmly committed to his concept and his vision of what the future can bring.

Keep in mind that he was not specifically defining borders or territory or anything in fact when he made the proposal. He said, "I am not in the real estate business." So it's up to the Palestinians to make those decisions. What he's trying to do is provide leadership in the Arab world. And he is working very closely with President Mubarak as well. This has been a coordinated effort, and they have been consulting closely. I know there are those who think that there is some kind of a contest going on. There is no contest. This is in the best interests of both countries. Both want to see it work. Both want to work with the United States to make it work. So we have a hard road ahead. He's aware of it. President Mubarak, who I also talked to, is aware of it. They are going to take a lot of flak in their own constituencies. But if we take the lead -- if we take the leadership and if we engage, this will be the strongest coalition that has been ever put together on peace, on the movement towards peace in this region of the world. And with the cooperation and help of our Israeli friends, we may actually make a breakthrough in this area.

MR. FREEMAN: Thank you, Ned -- very insightful and admirably succinct. Let me now invite Ofer Grosbard, who is the author of “Israel on the Couch,” to come up and put this whole process on the couch for us.

OFER GROSBARD: I would like to suggest in this short introduction a new and different look at the Middle East conflict using psychoanalytic tools taken from my profession as clinical psychologist. I shall concentrate on the Palestinian Israeli conflict. The terms of the final agreement between Israel and the Palestinians, the question of the borders, are quite clear today. We are speaking about the borders prior to the '67 war. The problem is not a few percentage points to this side or the other, or exchanging land - those are technical problems. I can also assure you that most Israelis support the Abdullah plan, and I believe most Palestinians also support it. So why do the parties, who might agree on the borders issue, or to Abdullah plan, not move toward peace? Why has the hostility never been greater?

The reason for this block is an emotional/psychological one. Therefore, I suggest that you think about this conflict in emotional, not rational, terms.

Israel has acted over the years out of a deep fear of annihilation. It has good reason to feel like this, mainly because of the holocaust and the attempt of Arab countries in the past to exterminate Israel. It is again true on the individual as well as on the national level that people under such a threat try first of all to convince themselves that they are very strong. It is difficult for them to be empathetic to the other, perceived as the aggressor. So Israel has made a lot of mistakes of this kind through the years. The Six-day War was an example of passing from feelings of existential threat to euphoric grandiosity in a very short time. In such a psychological state, Israel could not recognize the Palestinians. Our lives would be different if we had helped the Palestinians established their state after the 1967 war. We could have withdrawn from Lebanon much earlier, and in the future we will say the same thing about the West Bank and Gaza. For Israel to remain small and vulnerable psychologically is the most difficult thing. We call it "Auschwitz borders," and it is almost unbearable for us. Those anxieties, part of which have had a base in reality but are today mostly unrealistic, cause us to invite war instead of peace, like a self-fulfilling prophecy.

Under such anxiety, what is impossible for the Israeli leaders is to look straight into the eyes of the Palestinians and tell them that we Israelis recognize and acknowledge their suffering, and to say, we know that our independence was your Nakba (disaster); that we will do everything to help you build your state because it is our moral and historical responsibility - but still we are not guilty and do not need to apologize and that we also want to exist and have a state. Such an emotional statement from an Israeli leader, which will have to be repeated time and again, is invaluable. But still we cannot say it because of our psychological anxieties, which do not allow us to see the other. The Israeli leaders are afraid that if they say it immediately it will mean that we Israelis admit our guilt for what happened to the Palestinians. They do not understand the security importance of such declarations. You see how it is hard to recognize the suffering of the other and at the same time to not jeopardize your own right to exist. This is why this conflict is so difficult.

Because of these anxieties, Israel does not know something very important for every person and state to know: where do I end and someone else begin? What is mine, and what is not mine? We call it a separation difficulty or dependency. Yes, Israel is dependent on the Palestinians when it says our borders will be fixed only in negotiations. Israel has never decided on its own borders; it depends on the Palestinians to determine them. If you leave the Israelis to decide on their own borders, they will have a hard time agreeing about them without any connection to the Palestinians.

This question of separation has immense consequences on the emotional life of a state. Where do we put our energy, money - everything? In the settlements, or inside Israel with all its problems? What do you see on the media: the poverty inside Israel or the war outside our borders? Did I say outside our borders? I got confused. The libido, the emotional energy, should be directed inside for growth and not outside. These are only small examples of the huge sea of emotional problems of a people who for 2,000 years crossed borders and now are trying to pass from a religion to a state - to pass from the boundless kingdom of imagination to the ground of reality. Understanding these emotional dynamics suggests straightforward practical methods to enhance peace, but these are beyond the scope here.

The Palestinians have many emotional difficulties as well. To be a Palestinian means to feel oneself a victim and to be without hope. I think there are some basic facts that the West does not understand in this regard. In traditional hierarchical families many times the child and later the adolescent has two possibilities: to rebel or to surrender. This is the first occupation in the mind of the child. Here we can speak about women's liberation and children's liberation in Palestinian society. The feelings of victimization and absence of hope starts here. The second circle of occupation is the regime. Today Palestinians speak in a more open way about the corruption of their regime and how it exploits them. The whole world speaks today about the reforms that are necessary in Palestinian society. Then there is the Israeli occupation.

In the minds of the Palestinians all these occupations are one entity; it is impossible to distinguish among them. Therefore, Israel gets a lot of the rage that should be directed at the regime and the family constellation. It is very easy for the regime and for the parent figure to direct the anger to the so-called legitimate target, so they remain innocent. This is another powerful argument for Israel's prompt withdrawal from the occupied territories. The Palestinians cannot fight on two fronts at the same time. Only when Israel is not there anymore will the Palestinians have the chance to improve their regime and confront issues of civil rights.

Israelis and Westerners do not understand what it means to be under occupation, especially for Palestinian society, and what intense feelings of humiliation it generates. The willingness of some Israelis to replace Arafat is a huge mistake. The child has to rebel against his authoritative figure. He will never agree for an outsider to humiliate his father. It will cause him to cling to him and defend him in a stronger way. Israel should not be there, inside the Palestinian home, involved in this internal Palestinian business. I have no doubt that some of the suicide terrorists would like to set off their bombs in the office of Arafat, but it is impossible for them to recognize this repressed urge. The deep feelings of victimization and absence of hope that characterize so much Palestinian discourse emanate from what I have just explained. They feel themselves victims on conscious and unconscious levels, and they also do not believe they can change their lives. This is the reason why so many conversations between Israelis and Palestinians end up with hope on the Israeli side and despair on the Palestinian side.

For peace to be achieved, Palestinians like the Israelis must know, where do I end and someone else starts? What is mine, and what is not mine? In short, they need the ability to be separate. The "right of return" means, on an emotional level, to be mixed up with Israel, to live in a dream and to wake up every morning thinking about it instead of building their country. It is not a coincidence that the Palestinians have not declared their independence yet, although the whole world - including Sharon - has agreed to it. To say that from now on I am independent is essentially an emotional declaration that aims toward growth, taking responsibility and directing the libido inside and not outside. The recent suggestions of Mubarak, Bush and others are the right beginning from a psychological perspective, but understanding this dynamics may also help with many other ideas. Therefore, the ultimate test that will tell us if we are on the right track is the ability of the Palestinians to build their independent state and to invest their energy inside in hospitals, schools, economics etc. and not outside in an imagined return to Israel. The concept of separation exists on the territorial as well as on the emotional level.

There are many other things in Palestinian society that should be understood with the aid of psychodynamic tools, if we want to enhance peace. For example, the denial of the Holocaust; their different theories about what really happened on September 11; the "lies" of Arafat on TV, his saying that the Jews have never had anything on Temple Mount - the list is endless. We have to understand where it comes from and what it really tells us. We cannot allow ourselves to skip such issues because of political correctness or to ignore them because of the absence of psychological tools to understand them. This fear of touching such issues is a fear of understanding empathically the other side.

MR. FREEMAN: Thank you very much, especially for bringing us back from the very elegant level of analysis that we have been at to a bit of -- (inaudible). I take it you were agreeing, however, in your final remarks, with Ofer Grosbard and others that, in fact, the contours of the settlement are quite clear.

What is lacking is the ability or will of the parties to reach that. And in this connection, I was very struck -- my last remark or question, as I introduced the topic, was whether the crown prince's peace plan was sustainable, whether it was politically sustainable, given the level of alienation and estrangement that exists.

And I hear you saying that, among Palestinians, but I think more widely in the Arab world perhaps as well, disbelief in the efficacy of governments that led to disrespect for those governments. The desperation among Palestinians is matched by the despair of other Arabs that peace will arrive. The rage of Palestinians finds its echo in the frustration of other Arabs, and everyone finds this an intolerable situation. And this leads to a sense of urgency about making a decision.

And I wonder, therefore -- I'd like to ask other members of the panel, perhaps Ned, to comment at the outset on whether, in fact -- leave aside the question of whether the crown prince's vision is an offer or an ultimatum. Is it an offer with an expiration date? You know, sell by such-and-such a date or take it off the shelf, because I think this is the external reality which would actually validate some of the disbelief that you report among Palestinians.

Ned, do you want to comment on that?

MR. WALKER: Yeah. I don't question for a minute the hostility of the Palestinian people to the efforts of Arab leadership to find a solution or to help encourage the United States to help find a solution. There is an enormous frustration that Michael's talked about.

And that carries over, as I said earlier, in Saudi Arabia. I mean, I've had people there talking about the boycott. One man said that he wouldn't smoke Marlboros anymore. Another said that his children were not allowing him to go to McDonald's or to drink Coca-Colas. And this is based on a realization that this has no direct impact on the United States; in fact, it only hurts local businessmen. But I was told, you know, it's the symbolism. It's doing something. Just do something, because the feeling is that nobody's doing anything, and there is enormous sympathy, based on the television, on the daily -- on the World Wide Web, the chat rooms and so on.

And the feeling is more intense, actually, among the younger generation, which hasn't been so exposed to the West, which hasn't gone out to university in the West, which is more and more isolated from the way we look at things. And that's a worrisome sign for the future.

But I don't think we ought to overemphasize this feeling. It isn't -- there's no -- it is not yet deep. It is not deeply ingrained. And as one man said to me, yes, it's true this concept of a boycott is achieving some traction in the region, and so you'll see people drinking Pepsis telling their children not to drink Cokes. It hasn't gotten that far yet.

And of all the possible leaders in Saudi Arabia, the crown prince still has a great deal of respect and -- by the people of Saudi Arabia. His words do make a difference. He is trying to make adjustments in the kinds of things that come out of the mosques, constrain the more egregious statements, work on the educational system, look for reform in his own society. These are all revolutionary items, and it is a difficult road.

And as Al-Jubeir said last night, if the Palestinian issue continues to fester and continues to get worse, it becomes harder and harder for other leaders in the region to take the kind of reforms that they want to do because they will be looking for safer ground as they -- as the people become more and more intensely involved in this issue.

So it's important that we move quickly, that we move aggressively, in order to recapture our own credibility in that region.

MR. FREEMAN: Mamoun, and then we will go to questions and comments. One old hand has already signaled his intention to make a comment or ask a question. I'd ask you if you do that, please to come to the microphone so we can have a record of your eloquence on the tape. And please identify yourself. And please be brief when you're eloquent.

MR. FANDY: Well, I would like to say for any deal to take hold, you have somebody who is making an offer and the person on the other side has to accept that deal, and somebody has to be in the middle to close that deal. And the Arabs have made an offer. Some elements of Israeli society accept that. The Sharon and Netanyahu crowd do not accept that, very clearly. But I don't think it is fair to also see Israel as just Sharon and Netanyahu. It's a bigger thing. The United States is also going to be involved in all of this. To really dismiss sometimes the leadership of Arab leaders and say, yes, Arab societies think of their leaders as despicable is too much a little bit.

There is -- is this process politically sustainable? I think it is sustainable because there is no way out other than peace for that region. Will it be sustainable in whatever forms -- in the future may not be called -- it started as Crown Prince Abdullah's initiative, became the Arab initiative -- that came from Beirut. It can be called anything else, but I can't see any way out for that conflict except that kind of a deal. And Israelis will come along with pressure if the United States realizes the consequences.

Now, for Arab leaders, I really sort of admire them now more than ever because the street, as most people describe it, is boiling. And if people can take risk, serious risk -- when President Sadat went to Jerusalem, he paid with his life for that. But a risk was taken and a peace deal was cut and it's still holding. And I don't think it was absent from Crown Prince Abdullah's calculation that this risk is very heavy. And despite that, he took that risk. Despite that, Arab leaders took that risk. Are they despised by their people? Not necessarily so. I think Crown Prince Abdullah, President Mubarak and all serious Arab leaders managed, at least, to bring a large segment of their public along to buy peace as the way out.

The kind of Israeli hostilities, and the fact that now there is no daylight, if you will, between Israeli policy and American policy in the mind of Mohammed Six-Pack on the street, if you will, there is -- this is the point where people are frustrated. They want to see a daylight of separation between America and Israel. People now are burning American flag before they burn an Israeli flag. But in this atmosphere, people are taking risks, and that risk ought to be really seen as a big sign of leadership and should be taken very seriously.

MR. FREEMAN: Thank you, Mamoun.

John? Please tell us who you are as you ask your question or make your comment.

Q John Duke Anthony, National Council on U.S.-Arab Relations.

My question is for the three Americans and preceded by a premise which they can either validate or disagree with. It's increasingly, among specialists, conventional wisdom that, owing to the constraints that Michael and Ofer so pointedly shared with us, there has to be a third party, and that third party is primarily the United States. But up until Mamoun just began to touch on it, absent from the deliveries is focus on the United States and the political paralysis that is perceived by specialists.

I would welcome comment from the three as to how you see whether the United States is up to the challenge in terms of its own national interest. Does it have a comparable degree of vision, conviction, commitment and courage -- moral, political, personal, professional, perhaps even physical -- to do the right thing in the right way at the right time for the right reasons?

MR. FREEMAN: I'm sorry that Ed Walker had to leave us for an interview with a news organization, which probably is asking him that very same question. But Michael, why don't you start? And I think actually, Ofer, you may want to put the United States on the couch. (Scattered laughter.) And we'd be interested in your perspective.

MR. HUDSON: Well, John's asked a very big question. I think the -- if you try to answer it by looking at the track record of American policy, you don't come out with a very optimistic response. The pages of Middle East diplomatic history are littered with dozens of peace initiatives and proposals, many of which did come from the United States, most of which failed completely and only two of which succeeded partially, one being the Camp David agreement of 1978 and the other one, with many qualifications, the Oslo process of 1993.

But when we look at recent history, the failure, the collapse -- the disastrous collapse of the Oslo process, in my view, must be assigned very heavily to the inadequacy of United States custodianship of that process over a period of a number of years. And that doesn't bode well, but it sure looks in some ways a lot better than the lack of activity that we've seen in the present administration.

So as a political scientist who tries to disaggregate what you mean when you say "the United States' position" -- the U.S. political system and government is made up of many different elements -- is a tough one because while I think that there are elements of good sense and kind of moral vision in parts of this government, in certain parts of the executive branch, maybe even in certain parts of the Congress, the balance of forces seems to suggest that moving toward the middle is going to be extremely difficult for the president at this juncture to undertake.

And that has a lot to do with the configuration of political forces. When the House of Representatives passes an extremely unhelpful and unbalanced resolution, one wonders if this is -- one wonders, you know, whether there is any hope at all. And when the Senate does one that is almost as bad, one wonders again.

So I think if you look at it in terms of the play of political forces, it's going to be a close call. The compelling demand, the compelling logic of interests, a compelling analysis of the growing disenchantment, the growing environment for violence and terror, which is inevitably going to be mostly directed against us, would suggest, hopefully, that the top leadership eventually makes the right decision. That's why people over there and people here are waiting for next week, waiting to see if President Bush is finally going to make up his mind about this and whether he's going to come down with a balanced proposal or whether he's not. That's -- it's a tough one.

So I think that we can only -- you know, we can only hope that a sufficient sense of the gravity of the American situation in the region will permeate the highest levels of government here.

MR. GROSBARD: I think it's quite difficult to understand this conflict from outside by United States.

I would like to give you an example for an -- I would call it unconscious agreement between the Israelis and Palestinians. In order -- today, if you want to call on the phone to the West Bank, you pass through an Israeli telephone center, Bevek (ph). And today Israel supplies water and electricity to the West Bank. It's a sort of unconscious agreement of interdependency. I don't have to understand it.

The story is that after '67, there were two electrical power stations in the West Bank, and Israel decided to cancel it because Israel saw that if the Palestinians will be dependent on her, the chances that they will rebel will be less. So the Palestinians depend on Israel, you know, in many things, labor and other things.

But what happened today is that -- it's amazing. In the midst, in the middle of all the hostility, Israel supplied the Palestinians electricity, water and telephone services. Is it because of the philanthropy of Israel? I think that the answer is no; it is because of the dependency of Israel. And we know that very dependent people create a circle of dependency around them. They want others to be dependent on them. And Israel does it a lot. And the Palestinians -- again, subconsciously, consciously -- mainly, I think, unconsciously -- participate in this.

So if you think about steps to build a peace, you have to think about those things, how the Palestinians -- how Israel gradually stop supplying these things, gradually, in agreement, not suddenly, and the Palestinians take these things upon themselves. And I can give you many other examples like this, which is very hard to understand it from outside, but from inside, all the time, Israel never once said, "Because of the suicide terrorists, we stop electricity to you," because Israel wants this dependency. And the Palestinians don't say anything because they want it, either. So this is one example of this dependency that I think we have to -- if you understand it, it's easier to think about what we have to do in order to enhance peace.

MR. FREEMAN: Thank you.

Mamoun.

MR. FANDY: I think the main lesson of September 11th is that the United States cannot tolerate anymore any part of the world that's broken. And for a long time, the Middle East has been a broken region, a neighborhood, if you will, with bad plumbing, and they were flushing internally and nobody cares; but September 11th made it clear that this kind of flushing can reach New York and Washington, is extremely dangerous. And it's the business of the United States to fix that plumbing of the Middle East, the bad plumbing, as well as maybe South Asia in that regard. So the business of peace, it is very clear now, falls upon the United States because the consequences can reach the United States with that spectacular magnitude that we saw on September 11th.

Unfortunately, there are forces inside the United States who try to create some kind of convergence and compatibility between America's global and complex interests with, let's say, the Israeli interests in a small region like the Middle East. The fact is, is that these interests are not compatible, and Sharon's war is not really America's war on terrorism; this is something else, and it should not be allowed -- that war on terrorism should not be allowed to be hijacked by these forces and be misdirected and taken against different people.

Unfortunately, we don't have -- unlike other empires, we do not have the Lawrence of Arabia. We do not have people who understood the Middle East. We do not have clear understanding of the dynamics, the things that move people for or against the United States in that part of the world. And usually we're told that what Israel sees to be America's interest in the Middle East is what the administration should sign on it to be the interest in the Middle East.

The reality of it is that the Israeli lens is not the American lens; that the view of a regional power like Israel of global questions is not necessarily the view of a global power with complex interests.

So in this regard, I think that the American role has to be, in light of September 11th, has to be rethought and rethought carefully, to serve America's interests and America alone -- not anybody else.

MR. FREEMAN: I have one additional person listed for question and comment. I'd like to have other volunteers. And I'll take you down. In order to help that process, I will make a couple of extremely annoying remarks, myself, which may stimulate you to leap in.

First, let me say that I have four quick points to make in response to John Duke Anthony's question and finally Mamoun's comments. First, there's nothing new about the dilemma of presidents having to make decisions about foreign policy issues, which are also domestic policy issues. And the Middle East is overwhelmingly a domestic policy issue. If you doubt the antiquity of this dilemma, I urge you to re-read George Washington's farewell address, in which he speaks eloquently about the perils of excessive affection and dependence on foreign countries. And it is clear that Israel has an ordinate degree of influence in American politics to the point that the president finds it extremely difficult to examine these issues from the point of view of American interest.

The second point I'd make is, this president came to us from a position as governor of Texas, in which the residue of the Comanche issue looms a great deal larger than the Arab-Israeli dispute. And it's not surprising -- and, indeed, it's to his credit -- that he has taken the time, as he has been during recent weeks, to listen -- first to an Arab, then to Mr. Sharon and then to another Arab leader and to try, I think honestly -- let us give him this benefit of the doubt -- trying honestly to come to a considered judgment of his own about what must be done. Whether his considered judgment when he reaches it is adequate to put us in a position to address all of the issues that have been raised is an open question. But he is trying to reach a considered judgment, and let us hope he reaches the right one. I think he ought to get down on the couch with Ofer, and it would be very helpful.

The third point I want to make is that the very intimacy of U.S.-Israeli relations is a serious problem in American peacekeeping. This is stimulated by Michael's mention of Oslo. Oslo was done behind the back of the American administration precisely because the American administration was full of people with close connections to Likud. And those who did Oslo were desperately afraid that if they sought American help, they would instead find American mischief-making within the arena of Israeli politics. Just so now: Mr. Sharon's government could be brought down in a minute, but it is very unlikely that any Israeli politician would have any confidence in the American administration's willingness to work with the left in Israel. The administration is now full of people closely identified with Mr. Sharon and Likud and its philosophy. So the very intimacy of U.S.-Israeli ties, which ought to give the United States leverage, sometimes becomes an obstacle.

And the final point I would make is -- this is in response to Mamoun's comment on terrorism -- I'm a very practical man, and my concern is simply this: that there are movements, like Hamas, like Hezbollah, that in recent decades have not done anything against the United States or Americans, even though the United States supports their enemy, Israel. By openly stating and taking action to make them -- to declare that we are their enemy, we invite them to extend their operations in the United States or against Americans abroad. There's an old adage which says you should pick your friends carefully. I would add: you should be even more careful when designating your enemies, lest they act in that manner.

Fouad. Please tell us who you are.

Q Fouad Makhzoumi from Lebanon. Listening to the distinguished panel, there is no doubt there are few facts. One, that the Arab world -- you know, "the streets," as we call it -- does not trust their governments; two, Israel is living in the fear of existence, and that's why the United States, it would be very difficult for them at this stage to try to challenge the issues that Prime Minister Sharon is doing -- you know, in the incursions and all of this -- because it is perceived it is a war for the existence of Israel.

Putting it all together, we have today a framework which is called the Saudi initiative, that was ultimately formed in the so-called Arab initiative in the summit meeting in Lebanon. Unfortunately, this is an initiative and there is no road plan that is going to be involved in it.

On the other hand, as you rightly said, we have the -- the Arab world has -- they list their priorities one, two three; on the Israeli side, it's three, two, one. So we're coming from two different ends of the spectrum trying to set up a conference in order to discuss ultimate political settlements.

Every time the Arabs, we talk about the political settlements, the Israelis will talk about the security arrangements. So if that's the case, then we need to start coming up from the region with ideas to come to the United States in order to -- really, at the end of the day, all of us are negotiating with the U.S. None of the Palestinians or the various Arab countries, we would like to sit with the Israelis to negotiate, and this is wrong because, at the end of the day, peace is between Israel and the Arabs. But unfortunately, as an interim stage, everybody is negotiating with the United States.

One of the issues that I think could be suggested by the panel is to try to bring the Arabs now, after the moment of creating this initiative in Lebanon -- which is called, you know, the Arab initiative now -- and try to see how we can bring in the two leaders of the region. At the end of the day, Egypt has demographical presence of 69 million people, and their experience of dealing with the fundamentalists and the extremists has been very effective. You have the Saudi, with the religious position, what that represents, and the financial muscle that they have. And if we can bring these two to start putting a road plan in order to translate what was decided in Lebanon, in order to force this process and come back to the Americans and say "We are willing to take the risk with you," because it looks like all of us at the moment, we are asking the Americans to take the risk, put their plan, implement it, so that in case things go wrong in the Middle East, we have an alibi saying, "You've done it"; you know, basically it is not our fault.

So that would be my recommendation, if we can address that and try to get the Arabs at the moment, in particular Saudi and Egypt, to put a road plan, come back to the U.S. jointly -- not each one separately, as what we have seen over the last week -- come to them, say, "We are willing to take the risk with you," the political risk, which is most probably there will be a political risk. But if we don't start this way, there is a price to be paid, and I'm worried at the moment there is a "weak knees," as we say, to take that political risk.

MR. FREEMAN: Thank you, Mr. Makhzoumi.

Who would like to comment? Please.

MR. GROSBARD: You say rightly where to start, from the beginning or from the end. I think that the position now is so bad that no -- really minimal plan could be established. What I think right now is to make psychological plan. And I mean to take a few months, half a year, of little gestures, little gestures -- and you can think about many gestures that might help very much to change the atmosphere -- and then to come to other things.

First of all, something in the atmosphere should be changed, because in this situation, there is no doubt it won't go anywhere. And Israeli leaders can say a few things, as I suggested before. You can think about many things. You have to be creative. Of course, you have the -- I remember two beautiful examples, for example. One, of course, is Sadat coming to Jerusalem. Actually, when he came to Jerusalem, the gesture was so powerful that it changed the whole picture.

And the second gesture that I want to remind you that when Hussein, King of Jordan, came to the bereaved families of -- that the Jordanian soldiers had killed seven girls in Israel, and Hussein came and kneeled and wept with the families. And I remember I was in Israel. For the Israelis, this -- Israelis were so touched by it. And he didn't give up anything.

When you do a gesture, you don't give up anything. You just give something emotional, which is more important than all the details which -- I know -- (inaudible) -- from the clinic. When you're stuck on details, it means that the problem is not in the details. It's the relationship.

MR. HUDSON: Can I respond?

MR. FREEMAN: Please.

MR. HUDSON: Let me just make two responses to that interesting comment. First of all, I think that the policy makers in this administration look at the globe; they don't just look at the Middle East. I've been reading the text of a very interesting speech Richard Haass gave in April, in which he tries to define the -- effectively the Bush doctrine for coping with what he calls a post-post-Cold War world. And one, you know, can interpret that many ways. He's talking about the need for America to integrate basically everybody else into a more or less compatible set of behaviors and attitudes compatible with our security and our interests.

It is possible when one gets around to the Middle East, and Haass doesn't even refer very much to the Middle East in his speech, that one might think this administration would say, well, look, we've got, you know -- (audio break) -- Palestinian province, and why can't we just do this the way, you know, American settlers did it with the Indians a century or so ago? Now that's -- let's hope that it's not going to work that way, and I must say I'm very encouraged by the report that actually was out in the Times this morning about what President Bush actually may be thinking about saying next week, very interesting and very hopeful.

But the other point is simply if you look at the Middle East for what it is through our little sort of parochial, you know, lenses, as Israelis or Arabs or as Americans who follow these things, the answer to my mind is very simple. It comes down to one word. That word is "occupation." It's the occupation, stupid, as we say in American political parlance. And why is that? Because it is the occupation that is the cause, fundamentally, of the great and increasing distress that Israel feels, that America feels, and certainly, of course, that the Palestinians most of all feel. Therefore, anything that can be done to -- not just in terms of confidence-building gestures, but in terms of more tangible things to indicate that that occupation is ending, I think gets you toward where you want to go.

MR. FREEMAN: Mamoun.

MR. FANDY: I think it's very important as we think about the American role vis-a-vis the Middle East just to be realistic. I -- well, the Middle East from the Ottoman Empires down is really about empires, seats of empires and pashas ruling local vicinities. And if you look at Sharon, as far as the American empire is concerned, Sharon and his government are given $3 billion a year. The settlers are roaming around. The Israeli leader is one of the pashas of the empire and ought to be told what the solution is, rather than be talked to in the world of sovereign states. There is an American empire, in my mind, and empires impose solutions. And the outlines of the solutions are clear. President Bush listened to all the Arab leaders. He listened to the Israelis. And probably America has more leverage on Israel than it does on the Arab world. At least today the pasha of Tel Aviv is so dependent on the empire that it should be told what to do.

Q My name is Nadia Saad. I'm a retired World Bank official and a student of Islam and the Middle East.

I'm just coming back from Cairo, where I spent three months, and I must say, I've been reading the Al-Ahram every day, and I'm very interested in Professor Hudson idea that he can see some light at the end of the tunnel. If you spent just three months in Cairo, you don't see any light at the end of the tunnel. There is one dimension of this despair that we haven't -- nobody's talking about. And you read it in Cairo all the time.

President Bush, during his speech on the Holocaust, on the day of the Holocaust here, said exactly this, and this has been -- it came back over and over again on TV. And he said, "We shall always defend the people of Israel. We shall always give them full backing." And then he looks at the public with very keen eyes, and he says, "And they, after all -- the people chosen by God." And the reaction was really very intense. So who are we if Israel -- how can we ever hope that he will chat? How can we even consider that he is listening to the Arabs?

So this is a dimension -- they are really believing that he is a convert. He is totally identified with the Christian right, which are heart and soul behind the people of Israel and who consider just Arabs and Palestinians as, you know, terrorists, as second-class. I mean, the Egyptians are putting a bad word -- "If they are son of God, we are son of what?" You know? So this is some dimension.

The other despair -- I can just give you this imagery quickly. The -- they say, "If the Israelis today occupy Gaza and come to the frontier of Egypt, what can we do?" And people said "Nothing."

"Now suppose they come to the canal" -- the Suez Canal. "What can we do?"

"Nothing. Are we going to fight America?"

So the idea of the total identification of America with Israel is really something that you can see very strongly. And I really wish somebody would give me really some reason to see a light at the end of this tunnel.

MR. FREEMAN: Thank you for that comment.

Michael, I think you should respond. And my question to you is, if we can see the light -- and several of us said we could -- is there a tunnel? (Laughter.)

MR. HUDSON: Well, I don't often meet somebody who is more pessimistic than I am about the situation, but I take your point, and I understand exactly what you mean.

What I meant has to do with the shape of an ultimate solution, a permanent, accepted solution. And I think there is a consensus out there that will be acceptable to mainstream opinion, as well as to governments which have already essentially accepted it, with the singular exception at the moment of the Israeli government, this particular Israeli government. But I think there are plenty of people in Israel, there's plenty -- there's opinion poll data from Israel that shows that, you know, Israelis are ready in principle for a secure two-state solution. So that's the reason I think there's a little light.

But Chas's question, of course, is the tough question about -- it's about the tunnel. It's how do you get from here to there. And to -- in this respect, I must say I am quite pessimistic, partly because I think this government in Washington, for reasons that have been discussed, is -- you know, is unlikely -- it could happen, but it is unlikely, I think, that it will, in a sense, do what needs to be done to jump-start the diplomacy that within a fairly short period of time will end the occupation. That's the goal that you want to get there.

But I think if you're going to do it, this is not a burden that the United States government can carry by itself. An American role is essential, but it should not be exclusive. And that's why, if there's a tunnel to be constructed, it needs to be constructed multilaterally. It needs to be a coalition along the lines -- for example, Colin Powell made very interesting gestures in some discussions about a quartet, an international quartet, that would actually really work as a seamless, totally in-agreement group to do -- as Dr. Fandy says, do what the empire thinks needs to be done in this case.

And probably somewhere in that tunnel there needs to be an international military presence, at least observers, but probably more than observers. There needs to be a kind of a security presence, both for the sake of Israelis and Palestinians, because the gap, the hatred and the fear, between these two populations at this moment is extremely great.

MR. FREEMAN: I think we should also note, as Fouad Makhzoumi (sp) did in his comment and question, that it would be very helpful if the unity that the crown prince's proposal evoked at Beirut among Arabs were extended to a united position on the construction of the tunnel.

That is, how you get from here to there. And so far, while we see signs of some kind of coalescence of views, there is no common position or common vision on the means to an end that everyone in the region who is thoughtful, including, I think, the vast majority of Israelis, as Ofer said, would like to find a way to get to.

Ma'am?

Q My name is -- (inaudible) --. And what I would like to ask is, because of the multiple turnovers in the government in Israel and the differences of their opinions of how things should be carried out, has this hindered their ability to bring about peace and agreement in a peaceful process?

MR. FREEMAN: You're asking whether Israeli politics are an obstacle to a decision on peace?

Q Right.

MR. FREEMAN: Do you want to -- Ofer, do you want to talk about your own country for a minute?

b>MR. GROSBARD: Excuse me. I didn't understand so well the question. What exactly you --

MR. FREEMAN: The shifting factions in the Israeli government, the instability of Israeli governments, an obstacle to a decision.

MR. GROSBARD: Paradoxically, today, the government is more stable than anytime in the past. It's a union government of left and right, of Peres and Sharon. And you know, when there is a perceived of threat outside, it's natural that inside you get union. The same happened -- the same thing happened with the Palestinians. So, the salvation won't come from here.

MR. FREEMAN: I think that's a fair response. It takes account, ma'am, of the fact that over the last 20 months or so of the Al-Aqsa Intifada, there has been a steady hardening of attitudes on both sides and a steady process of the unification of views on both sides around hard lines. Many people suspect that if Mr. Sharon were to fall from power that he might be succeeded by Mr. Netanyahu, or some other yahoo on the right. (Laughter.)

And others believe that if there were an election and a reformed Palestinian Authority, it might bring to power Hamas or some similar Palestinian analog of the Israeli problem. So the shifting kaleidoscope of Israeli politics has been a serious problem in the past. It's the very stability of the Israeli government now and the lack of obvious alternatives on the Palestinian side that is the obstacle.

Sir?

Q Jefferson Gray, the University of Utah. One of the things that's been interesting for me about listening to this conversation is about how it seems to me the fundamental question being addressed is about whether or not the states in question can deliver their societies for a peace plan. And those gentlemen I hear on the right say that there is opportunity for these things to happen. For the most part, from the gentlemen on the left, I hear pessimism as to whether or not the states actually can deliver even if they can come to an agreement.

I'd first like to direct the first part of my question to the gentlemen on my left, especially Dr. Hudson, and also Dr. Grosbard. And that is, Michael, you have told us that this is the worst thing that you have ever seen in your 20 -- 40-odd years of doing this research. Well, you'll forgive me for a second, and that is that myself and a number of other people have heard you say that before.

And what I would like for you to do and Mr. Grosbard also to do is to say, number one, are things as bad now as they've ever been, and how do you know, based upon past experiences? And please feel free to compare anecdotally things that you've recently seen versus things that you've seen in the past couple decades of observing this phenomenon.

And then after that, I'd like of both Mr. Freeman and Mr. Fandy to comment on whether or not, given what we will hear from these people on the left, whether or not the states will be able to carry the water of their societies to peace.

MR. HUDSON: Okay. At some point, I want to talk about the Palestinian leadership, but --

Q Oh, please do.

MR. HUDSON: -- but let me respond to Jefferson's point.

Well, of course, time marches on and there's no logical reason why things can't get worse, and I think in fact they have. But in thinking back as to, you know, why one believes this, there was a report done by the U.N., the World Bank and the government of Norway, issued on May 15th, about the damage assessment from the campaign, the Israeli campaign in the West Bank: $361 million in infrastructure damage, the worst of it in the Nablus area. In one month, Israel destroyed roughly the equivalent of two years of public investment by the PA. Since the beginning of the uprising, they see $2.4 billion estimated in losses due to restrictions on people and goods, and $305 million in losses to infrastructure. And there are many more statistics like that.

I don't think I've seen anything like that. Since -- I've thought, you know, even in '67, I wasn't actually there when the Israelis occupied these places in '67, but I know people very well who were there. And they're unanimous. They say, you know, "What just happened to us is a LOT worse than what happened in '67." Maybe it's not as bad -- surely it's not as bad as what happened in '48, but you know, things can get worse, and I think, in fact, they have gotten worse.

Interestingly, they've also gotten worse for Israel. And I've got a bunch of other statistics about, you know, this intifada has done some serious damage to Israel -- not just in loss of life, but in many other ways, as well. So yes, let us not, you know, think of it that -- you know, we've reached bottom yet. Who knows? Maybe it'll get even worse.

MR. GROSBARD: Yes, things are getting worse, and number of casualties, suicide bombers, the mood, the atmosphere and the Israeli fighting on the Palestinian society. But I would like to say something which I think is very important to what happens here in the room now. I hear many claims about Israel. Part of them so sure they're right. But let's suppose all of them are right. So now you fight Israel to protect itself from these accusations.

I really believe that in this conflict, there is no guilty and innocent, bad -- the bad guys and the good guys or black and white. And I think to think about this conflict through this lens won't help us. I know that my Arab friends will argue with this, because they say all the time that they're just on their side. But I beg them to think about the couple, a wife and a husband. Israelis come to my clinic and one of them will say that all the just in my side and the other is completely wrong and we'd like to be like the States and to kill them, because it's the lowest position we can start of.

When you think that all the right is on your side, you're innocent, you're not in a position to take any responsibility. So -- and I would like to address the question in different way -- not who's right and who's wrong but why both sides suffer so much. And I would like to say same things about this reframing. If you speak about who's right and who's wrong and you bring that one side, you are in a paranoid way of thinking. You feel very, very pure, like a baby. And also, even if it's projected outside, so you can't see all also things that you do, which is not completely perfect -- (inaudible) -- paranoid system. I suggest to transfer the conversation to what we call depressive position. It is called depressive because you understand the you are not completely right. And it's depressive.

In this frame of reference of depressive position, which is said, because of recognition of the other, always in human development, also of people, of babies; in the human development, the process to recognize the other goes through mourning period -- I have to give up my egocentricity -- (inaudible) -- and to see the other, that what happened to Israel, that it can't recognized the Palestinians all the years.

So, this shift of -- this reframing to another way of thinking, when I ask why the sides suffer so much, this question is more empathetic, it enables dialogue. I must say this because I feel that for my friends sometimes it's too much white and black. Thanks.

MR. FREEMAN: It's inspiring to know that the tradition of Martin Buber lives on in clinical psychological form. I would say however that the analogy of husband and wife that you referred to reminds me of the old calypso which goes this way: never interfere with man and wife, they never understand, no matter who is wrong and who is right, just give them company.

I hope President Bush comes up with a better answer than the calypso. Mamoun?

MR. FANDY: I'd like to remind Rick that the question of -- for people in the Arab world, for the last fifty years, has been -- ordinary people in the Arab world -- has been that they've been deprived of most fruits of major revolutions that happened in the world for the last fifty years, simply because of the Arab/Israeli struggle.

So many people want to end that, because they see in this the imbetterment of their lot. They see a changing of economic conditions and other things, so there is a resignation on the part of large segments of the public that indeed this is the only way out. That their feelings have been exploited over the last fifty years by slogans like -- (speaks in Arabic) -- there is no voice that should be higher than the voice of war. And along the way, they were cheated of their destiny and their well being. People do not want to repeat all of that.

So that's sort of a general sentiment that exists. Many in the Arab world accept the idea of -- excuse me -- the idea of normalization for normalization. The peace process translates as normalization for normalizations. Arabs are willing to have normal relations with Israel: economic, cultural, given that Israel becomes a normal state. And normal states behave normally. They have their borders, they do not covet other people's land, that they do not occupy other people's land. I think if Israel looks normal in Arab eyes, they will have normal relations. And that's sort of the consensus.

And finally I would say that regimes are, in general, interested in survival. That those in power, the managers in power in the Arab world, are interested in being in power. Had they known that their public, really as it's being portrayed, that it is out to throw Israel into the sea, they would not have ventured out with any peace initiative. That Egypt had a peace treaty -- has peace treaty with Israeli since 1977, and it continues, and the Egyptians did not do anything except having more trade with Israel. Actually, trade between Israel and Egypt is bigger than trade with maybe Egypt and other Arab states.

So in a sense, you know, there is an optimism, because people in the Arab world want this thing to be over. But to put the whole onus of blame on whether the Arabs, Arab leaders, cannot bring their people along to accept a peace deal with Israel. I think this is simply missing the point.

MR. FREEMAN: Let me, since I was asked by Jefferson, to respond briefly to the question, are things really worse? They certainly are worse for the Israelis, who used to kill 25 Palestinians for every Israeli who was killed by a Palestinian. More recently, the ratio has been two to one. That is what led to Mr. Sharon's lurch over the border.

There certainly were, in the -- for Arab rulers, who now feel a level of popular pressure on this issue that they never felt before. Always, in the past, it was possible in much of the Arab world, for a ruler to look at this in rather cold-blooded analytic terms, and to be concerned about the Israeli-Palestinian issue primarily in terms of its potential to radicalize people in the region, and thus to stabilize the region.

Now, in addition to that cold-blooded calculation, one turns on the nightly news and sees atrocities committed in one's own living room, and as was the case with Americans during the civil rights struggle, the impact is moral and political, and it is very real and powerful. So what was once dealt with purely rationally becomes much more emotional in the region as a whole. In other words, Arabs are being drawn into Palestinian attitudes, struggles, suffering, vis-a-vis Israelis, in a way that they never were before.

So, I think yes, it is worse. And finally, attitudes toward the United States, for a variety of reasons, seem to be about the worst they have been since the 1973 war. Sir.

Q Mustafa Amali (ph). I am a freelance journalist. (Coughs.) Excuse me.

I came to ask a question. Professor Fandy really took the basis out of it. My premise was that normalization is the more difficult part than two states. I am from South Asia. We had two states, India and Pakistan. Have we been normal? The question is that I have -- I see it, not a question of territory, which is more important, but the attitude. The Jews have been here long -- since long before Muslims were there. But they were there. Now Israel perceives itself as a Western society. And the West perceives it a Western society. And Pat Buchanan says Capitol Hill is an Israeli-occupied territory.

So my question is that, in the cold war that we had between the East and the West, whether we like it or not, before that is over, how do you see this perception change, the Muslim world among younger people, it is terrible. The reason that it is worse than ever is the fact that King Abdullah came and pleaded for, you know, he didn't fall in love with that. Israel is not part of the Western system, security system. At the same time, West perceives it as part of the West, and Muslim world doesn't accept it. So will two-state solution really bring peace?

And the last point, the demographic situation, in the next thirty years, the population of Palestine and Israeli is going to be a majority Muslim. How can a Jewish state stay there? That is the problem. How do you see that?

MR. FREEMAN: On the last point, just in the interest in time, because we're coming close to the end. Obviously this is a principal dilemma that the Israeli occupation has created. That is to say, sustained occupation will destroy the Jewish character of the Israeli state, and therefore the occupation and the settlements that go along with it make no sense, in terms of the Zionist vision.

On the first point, I think Mamoun, in effect, as you said, was answering your question. That a normal Israel, an Israel that behaves normally toward its neighbors, would be seen by states in the region as normal, and would be treated by them as a normal state. The issue is from the point of view of the Arabs, much as you described it. That is, Israel is a colonial implant in the Arab world. It is not true, as the slogan said, a land for a people for a -- in a, people for a land -- oh whatever that was. Anyway. You know the phrase I'm trying to come up with, but it's so preposterous I can't remember it.

The fact is, there were people in that land. It was not empty. And if I heard Ofer correctly -- oh, he's out of the room at the moment. He was saying one of the key things Israelis must accept is that fact. And they have to come to grips with that. They don't have to apologize for their own state and their own need for a homeland, but they have to acknowledge that there were people there who have suffered as part of the process of answering their problems.

We have two more questions. Michael, you want to comment on this at all?

MR. HUDSON: No, no

MR. FREEMAN: And then we are finished.

More of a comment than a question, in answering the gentleman from University of Utah, a comment about what Mike Hudson says. Is it the worst ever? I've been going to Israel and the Palestinian territories since 1977, at least twice a year, and sometimes three times a year. And it is by far the worst ever. The statistics that Mike just gave are very correct. Let me add a couple other observations. Number one is per capita income, according to good estimate, has dropped by half. It used to be around 1500 and now it's probably around 700, 750, something of that nature. That makes it much worse. Because money means how much food that you have in your stomach, et cetera.

Secondly, and this is -- most people who are not there have a hard time realizing the extreme strictness of the closures and of -- on ability of people to move within the territories, which is something that you cannot imagine. If you live in Jenin, you cannot go to Nablus. If you live in Nablus, you can't go to Ramallah. Which means -- (inaudible) -- movement of people, goods, money, everything else, cultural, and for health reasons, makes it very, very difficult. One UN report had a survey showing that two or three hospitals that had an ordinary level of birth, women coming to give birth, had dropped 30 percent. That means those women are giving birth in other places, not as good as hospitals.

And last -- last comment, in the same context, while my organization sustained its economic and social development program, we are now heavily into relief. We are right in the middle of delivering a million dollars worth of food to people who do not have money to buy food. We've never had to do this, since I've been going there, since 1977. Equally, we're starting to buy milk, soap, towels, and diapers, to give to people who do not have money, because the per capita income is down. So it's very serious, and it's going to breed more terrorism. It has to.

MR. FREEMAN: Thank you. Yes, ma'am, and then --

Q Hi, my name's -- (inaudible) --. I work for Amnesty International. My problem is that Arab governments offer proposals without having the true mandate of their citizens. So cannot you envisage true peace between Arab people and Israeli people, without reform and democratization in the Arab world?

MR. FREEMAN: Without full democratization?

Q Yes

MR. FREEMAN: All right. Do you want to start?

MR. HUDSON: Well, you're quite right. There's a very big problem about the connection between people and their governments in the region, and most of the governments, all of them I think, to one degree or another, are authoritarian.

That said, I think that the answer, can these governments deliver on their diplomatic commitments. I think the answer would be yes, if the nature of the commitment is not totally or mostly objectionable to the public opinion that is there. Because even though these governments are authoritarian, there certainly is public opinion, and they're very much aware of it. And they are very much concerned about it. Even authoritarian leaders have to respond some way or other. So the nature of the settlement becomes really important.

Maybe I'm more optimistic than I should be about this, but I think the -- you know the Taba Plus solution that's out there, somewhere, is one that is going to be acceptable, not only to governments, but to their publics. I don't think it's such a big problem. I mean it's a problem, but it's not such a big problem, I think, for governments across the region to sell this to their people. That's not something that I worry so much about.

I worry about, I think, you know, the problem that these Arab governments have with respect to this issue is not so much their relation with their own people, although there's this huge disconnect, it's the fact that they seem to be so visibly impotent in moving a reasonable compromise proposal forward to the international community, and especially to the United States. And when they, you know, when they show that they can't do it, then people do begin to get unhappy, and then people start saying, well look, you should try something else. You should start thinking about sticks instead of just carrots. You should, you know, you should start maybe being a little tougher, a little less friendly. And that's the kind of pressure, I think, that builds up because the, you know, the sort of -- the prominent solution that they, you know, politely request that the United States government consider, doesn't get a really good response from the United States government.

MR. FREEMAN: Mamoun and then Ofer.

MR. FANDY: I think I made it clear in my remarks that for any stability in the Middle East and the well being of citizens there, there are two key concepts that are very, very important.

One, the concept of peace, as a concept that regulates relationships among states and reform that regulates relationships between states and their own societies. And the two of them are interdependent. I mean the two concepts are interdependent. When you have any kind of progress on peace process, governments can afford to make reform. And when there is also reform, there is public sentiment to move forward, to peace.

But that reform does not translate as just democratization as we see it here. As much as really sort of institutional accountability, and transparency in way where Arab politics transform itself from a sort of personal politics in many ways, to institutional politics, where in this age of globalization, Arab institutions have to be compatible with global institutions to at least do certain specific functions on this war on terrorism. You need to track many, you need to have these transparencies to be clear. So internal reform will certainly go hand in hand, where the organization of relationship between states and their societies and the relationships among states in the region is the only way out, and probably how much of this can be done when or how do -- what are the doses and the mix of the two concepts? Depends probably on each society.

If you look at Egypt, 1977 until today, Egypt started with peace, and doses of reform that's debatable. Is it fast or slow or how did they deal with the fundamentalist issue and other things? Saudi Arabia also is another state that's now taking on the concept of peace and internal reform.

There are lessons that are very important to be drawn from the Egyptian, but had this Egyptian initiative continued, or peace continued, probably Egypt would have been different than we see today.

MR. FREEMAN: Before Ofer speaks, let me hit your question head on, if I may.

Much of the criticism of regimes in the region is that they do make effective decisions and force people to adhere to them without consulting people. In other words, they act undemocratically, but very few people say they are ineffective in enforcing whatever decisions they make. They may be ineffectual in the particular context of helping Israelis and Palestinians to make peace, but they're very effective in many other arenas.

The second point I'd make is that -- so they can, the governments in the region, if they agree, do have the capacity to lead their people into compliance with the agreement.

The second point is the more crucial one. Any peace, we have to distinguish peace from concord perhaps. Peace is the absence of armed conflict or the absence of violence. Concord is something much deeper. It is some kind of psychological or mutual empathy as Ofer was describing earlier.

To get from the absence of violence to something deeper, which you recognize other people as human beings with rights and feelings of their own, which are entitled to respect, is not an easy process. There will be people in both Israel and in Palestine, who do not accept the peace. There will be settlers who are evicted, who are angry, and like the Pie Noa (ph) in France, they will act against the interests of their own government, in many cases violently. There will be people, extremists among Palestinians, who equally will not reconcile themselves to the deal at the outset. And what will be required on both sides is a measure of commitment and leadership to transform peace into concord. But it can be done.

MR. GROSBARD: I think your questions are too good to answer in short time. Professor Fandy suggests maybe, that was my impression, started it from a thing that if there will be peace among the states, it will be easier to make reforms inside. I don't know what is first, the chicken or the egg -- or both of them in a parity way.

But just to exemplify the deep connection between inside and outside, between the kind of regime and the peace process. We have to think about a few things that we don't speak about it so often, maybe. For example, many Palestinians and people in the Arabic countries. For example, after September 11 they said that it was kind of conspiracy here. It's not exactly what we know or what we hear in the media. There are many examples like this and recently I spoke with a few Palestinians and they've heard amazing stories about conspiracy between Sharon and Assad. You take the Golan Heights and you will take Lebanon. The Syrian will take --

Many things, and I am from my clinical point of view, try to understand it. I feel obliged to understand all those things, and many others. Again, the time is not enough to get into it. Many Israelis ask for example Arafat says the Jews have never had anything in Mount Temple. And he said it to Barak, Clinton answered that you speak nonsense, and that was the end of the conversation -- a mutual insult.

Thousands of examples every day, that we have to understand it. And I think with clinical proof we can understand it. I think that it's hard for the Western society to understand what does it mean to live in non-democratic society. When you speak with people and you're not sure that they can say freely what they think. So the discussion is different, but we forget it. So what are to say that why many, for example, Arab will tell you that the Holocaust didn't exist. Many think that -- or exist in different ways. You hear it many times.

The reason is that because it's very hard for them to believe the authority figure. Very hard. And the media is authority, and the books is authority, and the regime is authority. They're in a position not to believe. For sure for the Israelis. So we have to be so sensitive that when we speak about peace, and we are getting surprised every time, why it gets worse. It gets worse because we don't understand the depth of the conflict here.

But is it just to connect the inside and the outside to your question. I can keep on talking about it for hours. It's something that we have to understand.

MR. FREEMAN: Thank you. Ma'am?

Q Corine Hegland, National Journal.

Not to one up you on pessimism, but as I look at the initial reports of the Bush administration's thoughts on a transitional Palestinian state, I get very, very nervous. It seems like it's the opposite in some ways of the Saudi initiative. Provisional state means no boundaries defined, everything's up in the air, and the time to create more and more facts on the ground, which you can't negotiate backwards from.

Could you address in a little bit more detail, actually, both of you. Based on what you know so far of what's coming out of this transitional state, and this sort of interim negotiation space. Where do you think that's headed?

MR. HUDSON: Well, I can't tell you much, because I just read the papers. And it's interesting that, you know, these pronouncements and hints are couched in Delphic terms, so you can kind of read them in different ways.

I think there are basically two trends that are sort of in contestation with each other within the administration, and I don't know how it's going to come out. But, as I try to read between the lines, I get the sense that there's a version which is sometimes identified with Secretary of State Powell, and some of the things that he says to some people, that suggests, from my point of view at least, reason for relative optimism, in as much as he appears to be saying, you know, we've got to, we've got to give the Palestinians some immediate relief. We've got to have a state.

Well, what does provisional mean? I don't know. I don't know. We've got to have a quartet. We've got to think about, you know, international involvement and so on. And that, you know, can be read, I think, in a kind of a hopeful way. But the other tendency, of which there seem to be plenty of hints that it is, you know, has got powerful allies, is quite the opposite. It tends to lean toward the notion of perpetual interim agreements, leading ultimately, and who knows when ultimately is, to a situation in which the Palestinians will be having a degree of autonomy or self-government within a, you know, certain number of enclaves that are completely surrounded and monitored, and whether that collection of enclaves is called a state, or what, I don't know. But depending on what you mean by an intermediate, or provisional state. You know, you can read it one way or the other.

I think the advice the advice that this -- (audio break) -- while studiously ignoring substance, and surreptitiously allowing the occupation through the settlement thickening to deepen. So all I can do is agree. I can read it in a, you know, kind of a gloomy way too, and maybe that is the way it's going. But it seems to me also that one could imagine that within the depths of the state department at least, there is a realization that, you know, we have to have tangible results and soon.

MR. FREEMAN: There are, I think, it's clear that there are different schools of thought within the administration. I suppose if the administration were an individual rather than a collective body, one would call this schizophrenia.

What the president has been trying to do is to come to a conclusion, which presumably will unite his administration beyond, behind whatever it is that he ultimately decides. I think it's not unusual to have a state with no defined borders. Israel is a state with no defined borders. As Ofer remarked earlier, basically Israelis look to Palestinians to define their borders. I think Palestinians and Israelis are going to have to mutually define the borders of the Israeli state, if Israel is to be accepted in the region. And Palestinians and Israelis are going to have to mutually define the borders of the Palestinian state, if Israel is to accept that state. So, I don't find the notion of a state first, followed by the definition of borders, all that terribly unusual.

The final point is, and I'd like emphatically to agree with Michael. There is a consensus in the region, based on experience that never again should a process be allowed to substitute for peace. The peace process became an excuse for avoiding hard issues, deferring them and never resolving them. That is no longer acceptable to anyone. And in that sense, the situation really has changed, and we do have to start, perhaps, instead of in the manner in which Mr. Sharon would prefer, leaving final issues to be resolved at some undetermined date in the future, I think that's a recipe for no resolution at all, ever. And ultimately fatal to all concerned.

I think we have to turn that on its head, and we have to resolve some of the issues up front, and then negotiate the details later. But the heads of agreement have got to be established, and I'm hopeful, that one cannot, I'm not a clinical psychologist, Ofer is, but I suppose it's very hard to determine what the viewpoint of a schizophrenic is, depends on the moment, but assuming that we cure our national schizophrenia on this issue, in some respect, next week, with the statement by the President then, we'll have a better answer to your question. Jim?

Q My name is James Akins (ph). The Abdullah Plan is what we're supposed to be discussing here.

MR. FREEMAN: Thank you for reminding us.

Q We've gotten sort of away from that. Abdullah is extremely popular in Saudi Arabia, there's no question about that. And when he launched the plan, I think that probably didn't have the support of most of the people of Saudi Arabia, but they thought that if he wants to, we'll certainly go along with it.

And the assumptions that this will be agreed to immediately in the United States with great applause and approval. And when the first American reaction was nothing, there was shock in Saudi Arabia. But then we decided that perhaps there was something. Abdullah came to the States, he had, according to all reports, good talks with the President in Crawford, and better talks with Bush the father in Houston. But then nothing came of that. We had this strong visit to the United States and things went back to where they were before.

I'd like to endorse what Michael Hudson said in passing, that things, we all said thing have never been as bad as they are now. I went to the Mid East first in 1951, and I can repeat that, with strength. I've never seen it as bad as they are today.

People have decided that we have pleaded, we've offered this extremely important offer, the United States should endorse it, and we should have basically an imposed solution in the Mid East, which people have referred to here. We're not going in that direction -- (inaudible) -- was ordered, for example, to leave Jenin, immediately, and he gives the president the finger, and the president pulls his forelock and bows and says, I didn't really mean immediately, just at your convenience That had a tremendous effect in Saudi Arabia, the rest of the Muslim world as well. It should have had an effect in the United States.

People are now saying we've pleaded, we've done things that we wouldn't have thought we'd do before. Maybe we should stop doing -- start thinking of doing something that will hurt the United States. And I guarantee you that's being done in Saudi Arabia and in other countries. And there are things that can be done. I don't think the government is going to impose the oil weapon. They tried it once before; it didn't work very well, but there are a lot of people in Saudi Arabia who think that it should be done, that it can be done, privately.

The oil fields cover a huge area, ill-defended; they cannot be totally defended. And I should not be a bit surprised if some group in Saudi Arabia, not necessarily hostile to the monarchy, or certainly not hostile to Abdullah, would take it into their own hands and decide that oil production in Saudi Arabia is going to be curtailed.

MR. FREEMAN: I certainly hope you're wrong about that.

And -- but I do thank you for again, some more ground truth. I can't say that I disagree with anything that you've said, in terms of your description of the situation.

We've come to the end of the time. I would like to invite each of the panelists briefly to make a final comment, if you wish to do so. If you don't, well, then you're eloquence today will stand as your statement. And we'll go in reverse order, having started with Mamoun, we'll give you the last word.

MR. GROSBARD: I think that what is hard to understand in this conflict, when we want to start thinking about peace, is not the what question, what we are going to do, but how. Because the how questions, it addresses the emotions. Many times you can do something, and it will be good or bad, or don't do it. The Abdullah plan, it will be also good or bad. This thing that you did it or didn't do it, didn't determine if it's good or not, but the how. The question in the area is how.

The second thing I just wanted to make brief comment, we didn't speak about the refugee problem. I just wanted to suggest a new term. The term I want to suggest is a set peace. Because in a few weeks, I spent a lot of time speaking with the Palestinians, and they tried to go behind, okay we have an agreement, and both sides, we agree to the 67 borders, and okay. What will be with the refugees.

So they answer me quite honestly, that first of all as I know it's not so easy to give up dreams. I know it from my profession. But they told me quite honestly, that a part of the Palestinians will agree, of the refuges will agree to get compensations or exchanging land, or things like this. But part won't agree, and this part will mean that the terror will keep on going. And I think that why call it set peace? Because we might improve the situation; it might be better than now. But we'll have to put down our expectations. I think that if it will be less terror, for us it will be a lot.

MR. FREEMAN:

MR. HUDSON: The one point I'd add at the end is that I believe that there is a significant linkage between the unsolved Palestinian/Israeli and the larger Arab-Israeli problem. And the issue that certainly is highest in priority on our government's agenda, and that is what we call the war on terrorism. Or more generally the threat or transnational violence and hostility.

There are various causes for the al Qaeda phenomenon and so forth, but I think if one had to choose one particular one that is of singular importance, it is this unsolved problem. Therefore, I think the US government should take advantage of any constructive diplomatic initiatives that are being offered by any governments in the region, including Saudi Arabia or Egypt or Europe, or indeed Israel, if Israel is able to come up with one. In order to help put this fire out.

MR. FREEMAN: Thank you. Mamoun.

MR. FANDY: Well, I would like to say, I think at the end that in March 28 of this year, the crown prince's initiative became an Arab declaration for peace from Beirut, and in April, the crown prince came and conducted his conversation with the president at Crawford, and elaborated eight points to further take this Arab initiative into a little more details. President Mubarak was here last week to further elaborate the mechanics of that Arab declaration. I think on the record, for the whole world to see that the Arabs have made it very clear that he's the strategic choice that they have made, and collectively signed on.

It remains to be seen whether the other party would engage, and one would hope that the United States would see that this war on terrorism, that's probably going to be very long, should not be distracted, or misdirected by other forces, should not be that train where everybody puts their things on for the United States to fight local wars on behalf of this country or that country. That these destructions should be taken out of the war for the United Sates to focus on its own security needs rather than other countries' security needs.

MR. FREEMAN: Thank you. I think in conclusion, someone once remarked that genius consists in seeing the obvious before everyone else sees it. And the crown prince, like the panelists, may therefore aspire to the title of genius. Because there really is no rational alternative that anyone can describe to the basic outlines of what he has proposed. Unfortunately, however, if there is no rational alternative, there are emotional alternatives. And that is really what we've been dealing with. Some of us directly in a clinical manner, some of us indirectly in terms of political analysis, but it remains the great problem in this conflict. And I, listening to everyone, accept that offer or ultimatum may have been an imprecise phrasing of the dilemma here, and yet there is a clock ticking. The psychological underpinnings of the strategic choice that Arabs, I think have made, is not secure. And this does represent both a great opportunity and a great challenge for the United Sates.

Thank you all very much for coming.

(Applause and end of event.)