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In the 35 years that I served this country by engaging in diplomacy in the Middle East, America has never been so low in the estimation of the Arab world as it is today.

In Jordan, which has established peace with Israel and is probably our best Arab friend in the region, 93 percent of people in a poll this summer had an unfavorable view of the United States. In Morocco, our oldest friend in the region, 68 percent had negative views about the United States. In places like Egypt and Saudi Arabia, which have been the target of heavy US press and political criticism, the number goes up to 98 percent. In another poll this summer, only one out of ten Muslims believed that America respects Islamic values and only 7 percent of the Muslims polled thought that the West understands Muslim customs and values. These statistics should tell us something. Something has gone badly wrong.

Even more profoundly disturbing results from these polls came when respondents in Jordan and Morocco were asked whether or not suicide bombings were justified against American forces in Iraq and against Israelis by Palestinians. 70 percent of all Jordanians and 66 percent of Moroccans said that attacks on our servicemen in Iraq were justified. 86 percent of Jordanians and 74 percent of Moroccans said such attacks were justified against Israel. For all the rhetoric and political posturing about the war on terrorism, we are losing our first line of defense – public opinion. When people in the region consider suicide bombing to be a reasonable solution to the area’s problems, then terrorism has a fertile field in which to grow and gain new recruits.

Our armed forces, in time, may be able to pacify the situations in Iraq and Afghanistan – let us hope so. But no matter how many military personnel we invest in these wars, soldiers alone cannot win the war on terrorism. Only with support from the people of the region, as well as from the world at large, can we win that war.

Our star has faded for a lot of reasons. And, obviously, the situation in Iraq is one of them. But even though Iraq is at the center of the political debate here at home, the Palestinian issue has been, and remains, central to attitudes in the region for a long time. If you plotted the ups and downs of America’s standing in the Middle East and then plotted the level of our engagement in the Arab-Israeli peace process, the plot lines would be virtually identical. When we engage our stock goes up. When we seem to be walking away from the problem our stock goes down. The extraordinary thing about this correlation is that it does not depend on success. We don’t have to make peace, or force others to do so, to gain respect. All we have to do is to make it clear that we are actively working to find a fair solution – and that is not clear today.

Anwar Sadat, in turning Egypt toward America and away from the Soviet Union, justified his position by saying that America holds all the cards in the Arab-Israel conflict. People in the region did not believe him then - they do now. And why? Because of the friendship between Israel and the United States. The greatest asset we have in the region - the greatest point of leverage - is our friendship with Israel. No other power, super or otherwise, has the confidence of the vast majority of Israel’s people or the credibility to help find a fair and secure solution to the conflict.

Most of the people in the region believe that the problem will never be resolved unless the United States uses its influence with Israel to bridge the gaps. It is this expectation that gives hope to the people that some day they will be able to put this issue behind them. When we turn our back on the issue, hope dwindles, violence persists, and the United States gets the blame. Ironically, we are blamed for identifying with Israel, while at the same time we are blamed for not using that identification to press for an equitable solution.

While an American election campaign is hardly the time to press forward on the Palestinian issue, we need to recognize its centrality to the US position in the region and to our war on terrorism. As hope and frustration grow in the region, so do the numbers of young men who are susceptible to the appeal of terrorism and who swell the ranks of terrorist organizations.

Thus far there has been relative separation and differentiation of goals between the forces of al Qaeda, who are motivated by perverted religion and hatred of the United States, and organizations like Hezbollah, Hamas, and the Palestinian Islamic Jihad who have directed their nationalism, frustration, and hatred against Israel and all Israelis. But those forces are beginning to come together in the cauldron of Iraq, where the Jordanian terrorist Zarqawi has begun to blur the distinctions. Zarqawi is building his organization around the premise of a war on Jordan, Israel, and America, and he is now attracting elements of al Qaeda to his cause. The risk factor is increasing, not decreasing. And we need to take steps to counter it.

The Palestinian issue is not the sole component of our problems in the region, but it is one important part. And while the debate in the press, on television, and between presidential candidates in this country reverberates with charges about Iraq, the media in the region are still heavily focused on Palestine and Israel. After our elections, if we are going to moderate the hostile opinions the people of the region hold about America, we will need to refocus our attention back to the Palestinians and the possibility of an agreement with Israel. Having said that, the question is whether or not any effort on our part will make a material difference in helping to pacify the situation in the West Bank and Gaza. There are unquestionably serious doubts that anything can be done about the problem right now.

In fact, I question the validity of any proposal or plan from any quarter that would seek to bring the Israelis and the Palestinians together in negotiations today. This is not the time for negotiations between Israelis and Palestinians – it is, instead, the time for negotiations among Palestinians themselves.

The US and the Israelis have discounted Arafat as a valid partner for peace. We have our different reasons - some emotional and some rational. But the principal reason, despite Arafat’s continued symbolic stature among Palestinians, is that he cannot present a unified Palestinian front to engage in negotiations and he cannot, or will not, define his objectives or the objectives of his people other than in the tired mouthing of ’67 borders and other hardwired positions. The sine qua non for peace is Palestinian consensus, or near consensus, on the principles of a two-state solution and on a Palestinian state constructed on democratic principles - ending for all time the chapter of Arab efforts to destroy Israel. In fact, the mood among Palestinians is swinging away from the two-state solution as it appears to be receding in the chaos of violence and deteriorating conditions.

Much as we would like to see peace, we cannot ask - and we should not ask - Israel to accept the unknown of an undefined Palestinian state. Until the Palestinians know who they want to be and how they want to govern themselves, no negotiated security arrangements are going to be sufficient to guarantee against the establishment of an autocratic state in Palestine that has as its goal the destruction of Israel. And no piece of paper negotiated between the parties can be proof against a state that offers itself as a haven for suicide bombers and terrorists. And so long as this remains a possibility, there is no chance for any agreement to be reached. The world made a solemn commitment to Israel in UN Security Council Resolution 242 that withdrawal and peace must go hand in hand. That equation has to apply to the Palestinians every bit as much as it applied to Egypt and Jordan, and would have to apply to Syria as well.

We have ignored and bypassed the basic question of the nature of the peace the Palestinians are prepared to offer for too long. We tried to negotiate an agreement at Camp David that would have defined the borders of a Palestinian state but said nothing about what would be behind those borders. It is now time for the Palestinians to make some hard decisions and tell us all what independence means to them. But the condition that we and the Israelis have set for the Palestinians to move forward on the roadmap of peace - that they make these decisions, provide security, and bring the naysayers under control - is an impossible condition. No Palestinian leader has sufficient power, authority, or security infrastructure to unify the Palestinians behind a clear vision of a democratic future. The Palestinians need help - not isolation.

We have to help the Palestinians define their own future. If we do not want that definition to go the wrong way, we must help. We have to intervene in the internal Palestinian debate and support the quiet voices of moderation representing a majority against the violent preaching of a minority of thugs and wannabe martyrs. But we do not have to act alone. We have willing partners.

Egypt has made it clear that it is ready to help on the security front. It has its own security interest in the development of a moderate, stable and viable Gaza. European and United Nations resources can be brought to bear. And in the past, the Saudis and Jordanians have been willing to help in defining a democratic constitutional basis for a Palestinian state. In fact, Jordan has as great, or possibly greater, of a stake in the outcome of such efforts as Israel. Imagine the implications of a radicalized Palestinian state on Jordan’s long border given the Kingdom’s large Palestinian population. It cannot be a comforting thought for King Abdullah.

Among Palestinians themselves are many who are fed up with the autocratic style of an older generation of leaders like Arafat. In fact, there is a substantial and growing political movement in the West Bank and Gaza today that seeks to install transparent government and democratic principles, and end the traditional autocratic style of governance that Arafat represents. They seek to build their own power base through local elections. They feel that elections in the Palestinian areas are one way of moving forward on this agenda. We need to encourage and support them. And Israel needs to facilitate their efforts. Above all, we need to make sure that this movement has the space to pursue its goals. And to do this, we will need to use the one language Arafat seems to understand – money.

The world - and that means the Arab world and Europe as well as the United States - must decline to assist the Palestinians in the absence of genuine reform. Sources of revenue that have flowed through Arafat’s hands have to dry up. I am told this is increasingly the feeling in Europe. It is also the only true leverage we have to support change. Arafat is physically isolated by the Israelis - now he needs to be isolated financially and politically by all of us who have a stake in seeing a fair solution to the Palestinian problem. We do not need to destroy Arafat - we need only destroy his patronage system.

At the same time, we need to put greater pressure on the radical forces, both religious and nationalist, in the West Bank and Gaza who reject any solution that includes Israel as a Jewish state. Here we can use the tools we have developed against al-Qaeda in the war on terror. We need to apply them equally to terrorists of all stripes - including in the West Bank and Gaza. We have stressed that our war is on international terrorism - with al-Qaeda in mind; we need to rework that position to include all terrorists - whether they come out of Chechnya or Gaza. We also need to undercut the ability of radical groups to seduce popular opinion by providing benefits that the Palestinian government has been unable to provide. A European, Arab, and American consortium has to make it crystal clear that the way forward is blocked by groups like Hamas, who can only offer hardship, violence, and a dead end for their people. In the process we can build up the capacity and resources available to moderate Palestinian leaders so that they - and not Hamas - get the credit for providing essential services to the people.

Through all of this, the Israeli government must play a crucial part. One of the first orders of business for our President after the elections, regardless of who wins, has to be to develop a concerted plan of action with Israel established on some basis other than military power alone.

The Palestinians have to wake up and realize that if they continue along their current course, they have a bleak future indeed. The wall/fence will be completed, and it will become a de facto border which becomes harder and harder to adjust as time goes on. It is inevitable - like night follows day - that either Israel or settler movement will develop the Palestinian side of the fence. By doing so, the wall will, in time, become a major impediment to negotiating peace.

The Palestinians should take a lesson from the settlement cities that the Israelis have built in the West Bank. Today much of the world - including the United States - accepts most of those cities as a fait accompli and implicitly accepts that they will become part of Israel in any agreement. I remember when those settlements were a few outposts and their removal was possible. Today, no serious observer believes that these major settlement cities will revert to Palestinian sovereignty. If the Palestinians do not act, the wall will become the new Israeli ‘fact on the ground.’

In addition to seeing their territory continue to shrivel because of the wall, Palestinian freedom of movement will also continue to be constrained. More jobs will be lost, poverty will prevail, radicals will continue to be set up for elimination, and settlements will grow – all while the world sits by and lets it happen. And because of the wall, security in Israel will improve - it may not be perfect, but Israel has become pretty efficient at building barriers to terrorist movement. And with time, the wall/fence will become less and less porous. Despite what some Palestinians think, time will not be on their side - no matter how many children they bear.

As long as Israel is a victim of Palestinian terror, Palestinians fail to clean up their act, and they refuse to give up their dreams of destroying Israel, the United States - and probably much of the rest of the world - will have no sympathy for the Palestinian plight. The world is increasingly disinclined to ride to the rescue for countries and movements that fail to abandon terrorist methods – and the Palestinians are not going to be an exception.

September 11th changed the way we think about the Palestinian problem. That change is profound because we now identify with victims of terrorism everywhere - including Israelis. It is an emotional compact that was never apparent before and it has a significant political force. We will be prepared to give Israel far more latitude in fighting terrorism than we have ever given them before. The Palestinians and Arabs need to understand that change.

There was a time when we pressed Israel to negotiate despite terrorist attacks. At that time, I believed that if we allowed negotiations to be derailed every time there was a terrorist attack we would be guilty of rewarding those who sought to destroy the peace process and would invite even more attacks. I no longer hold that view. The problem with being ready to fight terrorism and fight for peace at the same time, as Prime Minister Rabin suggested, was that it took the pressure off of Palestinian moderates who said they wanted peace and a better, more secure life. They were led to believe that they could achieve their goal of a peace settlement without going through the difficult and painful process of doing something about the terrorists in their midst.

In my experience, the essential ingredient to winning against terrorism is the support of the people where the terrorists live. You can bloody their noses through military means, but you cannot solve the problem until the people withdraw their support. In Egypt in the mid-nineties, when the current al Qaeda deputy Zawahiri was leading the Egyptian terrorist charge against the Mubarak government, the terrorist organizations made a fatal mistake. They attacked a group of European and Japanese tourists in Luxor. The terrorists thought this attack would bring to bear economic pressure on the government. However, as a result, tourism stopped and thousands of Egyptians in the region were thrown out of jobs. Suddenly, the government began to get tips about terrorists. A permissive environment turned hostile. A similar phenomenon occurred in Saudi Arabia last year when the terrorists targeted Muslim communities. Suddenly families began to turn in their sons in revulsion against these acts. If these lessons are any indication, we have to increase, not decrease, the pressure on Palestinian moderates to take care of their own problem, but we also have to give them the backing they need to do so. At the same time, we have to increase the rewards for going down this difficult path.

If the Palestinians are willing to chart a new, democratic course and abandon terror with the help of the international community, then they also need to see that they are not blocked from their aspirations of building an independent and viable democratic state. In this context, Israel will need to help insure that a settlement-free Gaza does not become a prison. All the plans we negotiated at the end of the last century to provide a secure airport, seaport, crossings to the outside world via Jordan and Egypt, and safe passage between the West Bank and Gaza - possibly through a rail passage – must be put back on the table and funds made available to carry them out.

In my talks with him over the years, Prime Minister Sharon was always sensitive to the need for providing a viable economy and a reasonable standard of living for the Palestinians. I believe he continues to hold that view. In my discussions he also advocated mechanisms - like bridges, tunnels, and bypass roads - to provide freedom of movement for the Palestinians so that they are not trapped in small enclaves. Sharon was never an advocate of Bantustans and, as far as I know, he is not an advocate today. That should make the task of ensuring freedom of movement and commerce easier.

Where Prime Minister Sharon and I part company is his belief, as expressed to me, that a final settlement is not available now and that we will need a timeout of ten to fifteen years while the Palestinians build their capabilities and demonstrate their intentions before final status negotiations can succeed. He may be right, but I seriously doubt that we can sustain an interim timeout of this length without serious deterioration in the region.

Arik Sharon must be amused by the pundits who are now scratching their heads to figure out how ‘Sharon-the-bulldozer’ has become a moderate in Israel’s political spectrum with more support from the Labor party than from Likud. But the pundits miss the point if they thought that Sharon was an ideologue of the right.

Sharon was always an Israeli nationalist. As he explained to me, he was the last of the founding generation and felt an historic obligation to provide the people of Israel security for the future. He did not have much confidence that the succeeding generations would have the guts to ensure that security. He sought the support of the settler movement in his internal fights to win control of the Likud and gain the Prime Ministry. But I can assure you that every single settlement that Sharon advocated had, in his mind, a security rationale - not a biblical one. He has given me the map talks to explain the topography and security requirements that led to his positioning most settlements in their current locations. The first of those talks occurred in the early 1980s with Sol Linowitz during the Autonomy negotiations. That was when the settlements he outlined on his map did not exist. Today they do. I don’t believe that he ever felt that the Gaza settlements were essential for Israel’s security, and I am sure he has questioned the need for a number of the settlements in the West Bank as well. These facts give me hope. Sharon’s security settlement infrastructure appears to be complete. So he may well be willing to implement a genuine settlement freeze – a freeze that will be critical to the success of Palestinian moderates in demonstrating their political capacity to negotiate on behalf of the Palestinian people.

Sharon’s unilateral move to withdraw the settlers from Gaza and from a few West Bank areas is totally consistent with his long-standing position. It is the culmination of his approach to the Palestinian issue. The unilateral nature of his proposal is also consistent with his belief that the Palestinians are unable to make peace now - a view I think we would have to share. Through his Gaza plan, he has given all of us an opening.

We need to expand that opening. First, we must deal with the Palestinian side of the problem, build up the moderates, and deprive the radicals and naysayers of resources. Second, we have to work with Israel to increase the rewards for Palestinian moderation. And third, our President must engage the issue.

American presidential leadership - involving not just nice words but ‘rolling-up-the-sleeves’ action - is the one ingredient for peace that is absolutely essential not only for our own interests but for the possibility of a soft landing in the Middle East. This is a true test of leadership. Regardless of who wins in November, if the President ignores this problem because he is overwhelmed by Iraq and Afghanistan, convinced to undertake new crusades against Iran and Syria, or afraid of failure, then all of us - the Palestinians, Israelis, and the US - will be the losers, and peace will be a distant dream put off indefinitely.