George W. Bush photo

Press Briefing by National Security Advisor Stephen Hadley on Israeli-Palestinian Peace Process

January 10, 2008

Dan Panorama Hotel


5:41 P.M. (Local)

MR. JOHNDROE: Good evening. This will be a on-the-record briefing by National Security Advisor Steve Hadley on the President's last two days here and on his statement just concluded.

MR. HADLEY: Just let me recap the day a little bit. The President's day began with a meeting with Bebe Netanyahu, leader of the opposition. It was a private meeting. The two have obviously met before and it was an opportunity for them to talk about the opportunities here for peace.

He also had a private meeting with the two sons of Ariel Sharon, Omri and Gilad Sharon. The President expressed to them his admiration for Prime Minister Sharon and he asked God's blessing upon him and upon his family.

The President then had a one-on-one session with President Abbas; then went into an open session with the rest of the delegations on the two sides. And President Abbas gave the President a report on the status from his perspective of the Israel-Palestinian dialogue, the core issues that must be negotiated to reach a final status agreement. He noted that they had -- he and Prime Minister Olmert had reached agreement two days ago on the modalities for going forward with the negotiations, and that that would begin next week. And he indicated that there was a very, he thought, positive chemistry between the two sides at this point in time.

He did raise the settlements issue. He said that that remained a problem; acknowledged and recognized that once there is an agreement for the outlines of a Palestinian state, the resolution of those issues become easier. And both President Abbas and President Bush addressed the settlement issue in their press comments after the conclusion of their meeting.

President Abbas also talked about the security improvements. He believes that there's been significant improvement in security and in the economic situation on the West Bank; that they are working to end militias, to end incitement, and to end financial contributions to terrorists through charities or other options; and that, in addition, that they were seeing some progress in the economic life on the West Bank.

He also talked about the contribution that the Palestinian Authority makes to assuaging the humanitarian situation in Gaza, and you noticed during his press comments he noted that 58 percent of the budget of the Palestinian Authority goes to Gaza. The President expressed some confidence that when the negotiations are completed and President Abbas can offer the Palestinian people a positive vision for a Palestinian state, that that will make the resolution of the situation in Gaza much easier.

It was then -- the President then had a private meeting with Prime Minister Fayyad. We then had a very informal lunch. There was a -- it was a very informal relationship across the table; a lot of -- some reminiscences, a wide-ranging discussion, and at the end of it I think President Abbas kind of pulled the discussion together and made the point that the goal is to reach a peace agreement this year. He believes that the opportunity will not come again for a long time. He expressed his appreciation to President Bush for his support for the two-state solution, for the success in Annapolis and the subsequent Paris meeting, and for the opportunity that he gave credit to the President for, for creating for the current negotiations. The President said that in contrary, it was the parties that had created the opportunity, and they would have his full support. And we agreed to remain in close contact.

The President then had a brief meeting with former Prime Minister Blair. The former Prime Minister reported on his activities as the representative of the Quartet, to try and assist Prime Minister Fayyad in the building of Palestinian institutions.

And that's really the day. As you know, the President visited Bethlehem, and he obviously was very moved by the experience. And I think you got a flavor of that in the comments he made to the press at the end of the visit.


Q: The Palestinians say that the President told President Abbas that he would return to the Middle East one or two more times this year. Is that correct? And also, could you spell out, in the statement that the President made this afternoon, for those of us who aren't Middle East experts, is there -- did the President advance anything that the United States has not uttered before?

MR. HADLEY: On the first point, the President has indicated that he wants to do what can be useful to advancing the negotiating process; that if that involves further visits to the region, he is prepared to do that. He said that publicly, and I can expect -- I think you can expect you will see him again at least once and maybe more times in the region before his term is up.

Q: When you say the region, are you talking specifically about Israel?

MR. HADLEY: He is coming -- as you know, this time he's coming to Israel; he's met with the Palestinians. He's going to Egypt and Saudi Arabia and Bahrain, UAE. So I think when I say the region, he could come to Israel, he could come to other countries in the region -- he could do both. Obviously the itinerary is going to be driven somewhat by events.

Q: But you'll see at least one visit, you believe, to Israel?

MR. HADLEY: What I said is what the President said was that he wants to advance this process and he is willing to and thinks -- I think it may advance the process for him to come to the region again. I think he will be -- I think you will see him back in the region at least one time and maybe more before he leaves. Will he come just to Israel and come out? Will he come to Israel and other countries? Will he come sometimes to other countries and not to Israel? It will sort of -- form will follow function in terms of what he thinks he can do to advance this process.

Terry, the second half of your question -- the purpose of this statement was to reflect on what he's heard after a day of conversations with the Israelis and a day of conversations with the Palestinians. And as he said in the statement, it's an effort to set out what is a, in his view, based on what he's learned and what he thinks is a way forward, a point of departure for the permanent status negotiations.

That's what he wanted to do. And if you look at the statement, he addressed sort of his sense of the starting points based on what he'd heard for addressing the issue of territory, borders, refugees, Jerusalem, security -- they're all reflected in the statement. So it's an effort for him to pull together what he's heard from the parties, and to give, if you will, a kind of status at this point in time, where is probably the starting point for the conversations that they're going to be having in the months ahead.

Q: But are those the new positions for the United States, or are those -- is that our longstanding position?

MR. HADLEY: Some of them are -- we have said before. I think some of the things that we talked about we have not talked about before, because the parties haven't talked about them before. For example, the idea that there might be an international mechanism including for compensation, to make a contribution to solve the refugee issue -- this is an idea that's come forward really in the conversations we've had with the parties, and the parties have had themselves in the last month or so. So that's an example of some of these things. I think there is an -- there is a emerging of the kinds of issues that need to be addressed, and the starting point for the negotiations, and the way the parties might try and solve those issues.

Q: Yesterday, Prime Minister Olmert made a distinction about East Jerusalem and settlements, and I assume he was talking about Har Homa. Does the President make such a distinction when he wants the road map followed? Is East Jerusalem different? Is Har Homa different? Do they have to stop that?

MR. HADLEY: What we've done is said, and what the President did yesterday, and you've heard from Secretary Rice and from me as well, yesterday -- we go back to the road map. And the road map says that there needs to be a halt to settlement expansion. That's what the road map says. The road map also says that unlawful outposts should be dismantled. And the President made very clear last night, road map obligations are road map obligations; they need to be carried out.

As you know, the parties have agreed that they are going to be moving forward with carrying out the road map obligations, in parallel with their negotiations and the building of Palestinian institutions. We have a monitoring mechanism that the President just announced that General Frasier will be, a Air Force three-star, will be heading that effort.

So our position is the road map obligations are clear. Both sides, Israelis and Palestinians, need to be going forward on those road map obligations. Obviously the Prime Minister has talked about his views about how to approach the road map issues and to approach the settlement issues. Our view is the settlement expansion should halt. The Prime Minister expressed his views about how Israel is going to undertake that point. The other thing I would say -- as you know, this whole issue of settlements gets a lot easier once there is an understanding between Israel and the Palestinians as to what the territory of a new state is going to look like.

Q: Just one more question on that. First of all, it would seem that you're at odds, then, with Prime Minister Olmert on that and how that is viewed. Correct?

MR. HADLEY: I think it's fair to say that the road map is pretty flat. It talks about ending expansion of the -- of settlements. Prime Minister Olmert has made some practical distinctions that they are going to adopt in the approach they are taking to that issue. We continue to say, road map obligations are road map obligations and they need to be carried forth.

Similarly, on the Palestinian side, there are questions about security. If you look at the obligations that the Palestinians have under the road map for doing security, they are a pretty robust list of measures. Obviously the Palestinians are starting to, if you will, address those issues in a systematic way. They're not doing all of them today; they can't do all of them today. They are taking an approach to how they are going to, over time, deal with their road map obligations.

Q: Can I just follow up one more time on that? Sorry. So did the President make clear that you view Har Homa, an East Jerusalem settlement --

MR. HADLEY: You heard the President last night. The President said, the road map says there should be no further settlement expansion, and the President's position was the parties need to carry out the road map obligations.

Q: Could you tell to us a little bit more about General Frasier and how this monitoring --

MR. HADLEY: Can I say one other thing? Issues like security -- if I could have a follow -- issues like security settlements, I mean, these are real issues. The Katusha -- the rockets that are coming out of Gaza are real issues. There needs to be forms to address those issues. But one of the President -- the message the President's trying to send is, as we address those issues, don't lose the focus on the big picture, and the opportunity the parties have for the first time to negotiate these very difficult core issues and reach an Israeli-Palestinian peace. Address these important issues, but let's not let them get in the way of the big game here, which is, President Abbas said, a historic opportunity that may not come again to negotiate a peace between parties who are committed for peace, on the Israeli side and the Palestinian side. This has not been the case very often in the last 20 years.

And so the President's message is, yes, we need to address these issues that a lot of ink is spent covering, but don't miss the big game here. And what he wanted to do was to raise the sights of President Abbas and President Olmert in saying, your focus ought to be on negotiating the peace. Only the two of you can do it, and now is the time. Seize this opportunity. That was his message here.

Q: Could you tell us a little bit about the monitoring mechanism and how General Frasier is going to be working in that? Is he going to be regularly reporting, every so often? Is he going to be identifying individual incidents where the Israelis and the Palestinians fall short of meeting their road map obligations? How is that going to work? And if I could also -- just I don't know -- it's a separate issue -- if you know anything or could say anything about the purpose of the very large bombardment in south Baghdad today and what that was intended to achieve?

MR. HADLEY: I cannot recite on the bombing -- as you say, a bombardment of south Baghdad. I know -- I can tell you this: that the President was apprised before he came out here that there would be operations that would be undergoing by MNFI against some areas where security continued to be a problem. He was apprised of that in the SVTS that he had with General Petraeus and Ambassador Crocker on Tuesday before we came out. I assume that it's operational execution of that; that's really what I know on that point.

General Frasier -- we undertook, as you know, in connection with Annapolis to monitor the implementation of the road map. General Frasier's job is to be in dialogue with Palestinians and Israelis and get the facts on what each of them is doing to implement the road map -- what they are doing, what they are not doing -- and to bring that to their attention, which is part of this process of encouraging the parties to move forward on their obligations to complete the road map.

Why is that important? One, because implementation of the road map will build confidence in the parties, in each other and in the good intentions of each other. And secondly, because while they can negotiate the peace and negotiate the details of a Palestinian state, they have also agreed, Israelis and Palestinians, that that state will not be stood up until the road map obligations of phase one have been completed. That's why it says subject to the road map.

So if you want to get a Palestinian state at an early date you need to move forward with the negotiations; you also need to move forward with the implementation of the road map obligations. And this is an effort, at the request of the parties, to provide, if you will, an honest observer to, if you will, rate or evaluate the progress of the parties, have some transparency with the parties and between the parties -- because, in some sense, there tends to be in these situations, people overestimate what they are doing and underestimate what the other guy is doing, and this is an opportunity to get somebody in there who's a neutral third party. He's going to look at the evidence, has the confidence of both sides and can say, well, let me tell you how we see it; this is what you're doing, and this is what you're not doing; and be able to give that report to each party.

How it will operate is going to take some time to sort out. General Frasier will be here from time to time. He will meet with the parties bilaterally. Where appropriate, he will have trilateral meetings with them, as well. There will be at least one or more people reporting to him who are with the embassy and with the consulate here. So there will be a direct contact on the ground with the parties.

How big that staff will be, how it will actually operate will have to be worked out. This will obviously be in addition to the kind of general reporting Secretary Rice will get through diplomatic channels from Dick Jones and from the Consul General. So that's a starting point on how this mechanism will operate.

Q: If I could just follow up -- will those be public statements? Will those be private comments to the Israelis and the Palestinians? Or will he publicly say --

MR. HADLEY: I think that will have to be worked out. I think that will have to be worked out. It will be something that -- it will be what he thinks is appropriate for moving the process forward. It will also be something that he'll want to talk to the parties about. But remember, at this point he's being brought in to help the parties advance the implementation of the road map. And I think that's something that they're going to have to work out.

Q: Just to go back to Terry's question on the President's statement today. The President did not mention a lot of different things. He mentioned about five or six different things -- just listening to the statement and when I read it -- but other than the international compensation, potentially, for the refugee issues, everything else seemed to be pretty much standard U.S. policy. And I just want to make sure there wasn't anything else that you were thinking about that you felt was different.

MR. HADLEY: Well, one of the things that's, of course, different is in the first full paragraph about it, which is he talked about we've now launched four paths on the way forward -- a negotiating path, implementation of the road map, building institutions, and going to the Arab states and asking them to support this process. So the whole context has somewhat changed.

The second thing I would say is we have been talking about a number of these things for a while. One, what is useful is the parties are beginning to talk about some of these ideas and beginning to introduce them into their own dialogue, which is important because, in the end of the day, it's got to get into their dialogue before it will become part of an agreement.

And thirdly, I think you're seeing -- we're talking a little -- that the way we talk about some of these things has evolved over time. We've talked about two democratic states, Israel and Palestine, living side by side in peace and security. But we are also now able to talk about a Palestine -- not just a Palestinian state, a Palestine as a homeland for the Palestinian people, just as Israel is a homeland to the Jewish people.

Yes, we've said it before. The President said it at Annapolis. It's a little different than how we talked about this when the President started talking -- having this dialogue here four or five years ago. So I think there are -- I would say that there are four new elements: One, the context is new, the four tracks are new. That's the context in which it's coming about.

Second of all, what's new is this is beginning to get reflected in the dialogue the parties have among themselves and between each other. Third, the way with we talk about some of these things is evolving and has evolved over time, and the homeland construct I think is an example of that. And in some instances we're getting a little bit more precise and some new ideas have emerged, like the international mechanism and the compensation. I think that's what I would say.

Q: Can you just clarify -- first of all, the 1949 armistice, this is a reiteration of what we discussed yesterday, with the commitments about modification of borders -- i.e., that settlement blocks would be able to remain -- that's what the President is saying? And when he talks about ending the occupation, does he mean ending the occupation of the West Bank, including East Jerusalem?

MR. HADLEY: What he says is, as we've said before, ending the occupation that began in 1967. The borders of the new state, the question of Jerusalem is all going to have to be negotiated between the parties. And the President said very clearly, he could come and lay down on the table how he would describe a new state, and he's not going to do that, because his judgment is that is not the way to get an enduring agreement that would have the support the leadership and the people of the Palestinian community and Israel.

Q: I understand that he was talking about ending the occupation of the West Bank, but he's allowing for these settlement blocks to remain with that armistice statement, right?

MR. HADLEY: He is saying, one, on terms of settlement, he stuck with and sticking with the road map obligation. And secondly, as he said before and people have discussed, the issue of modifications to be agreed by the parties to the '49 armistice line is now something that the parties themselves are talking about. But again, exactly what those alterations and modifications would be are going to have to come out of the negotiations.

Q: Aren't you creating a certain amount of confusion about the sequencing regarding the road map versus final status negotiations? I mean, you've indicated that some road map issues may need to wait on the greater definition that would come from --

MR. HADLEY: No, I didn't say that they would have to wait. I said that the parties have undertaken the road map obligations; we need -- think they can carry forward those road map obligations. Obviously, neither the Palestinians or the Israelis are going to be able to do everything tomorrow under the road map obligations. They're going to have to go forward and implement them over time. And that's a sorting-out process that's going on.

All I was doing is noting the fairly obvious point that some of these things get easier once the parties have an understanding about what the state is going to look like, what its borders are going to be, what its security arrangements are going to look like. Then some of these issues get easier to solve. That's what I said.

Q: But doesn't that give, for example, the Israelis a lot of latitude to say -- to quote you, and say, well, we want to wait on that until we have a better understanding of the definitions of the contours of a state? Is it clear in the minds of both you in the administration and the parties negotiating how this is supposed to move forward? Is it precisely in parallel?

MR. HADLEY: In similar fashion, you could say that it gives the Palestinians a lot of latitude as to how they will, over time, assume and carry out their security obligations. What we would say is, look, we're not giving them latitude; the President's position is, you've made your undertakings in the road map, you need to carry out those undertakings. And the parties have started to do that. We want to assist them, we want to encourage them, we want to prod them, we want to facilitate them through the activity of General Frasier.

But, obviously, look, this is going to take time. And the parties are going to have to move through each of their reciprocal road map obligations.

Q: Steve, I want to just focus, if I could, on language and two specific words -- and we'll take them in turn. The first word, I want to draw on your much superior knowledge of the history of Mideast peacemaking, and that is the word -- this word --

MR. HADLEY: That sounds like a setup to me. (Laughter.)

Q: Indeed. And that is this word, "occupation" that the President used. To your knowledge, has an American President ever previously referred to the occupation? Have senior U.S. officials used that term?

MR. HADLEY: We have used that term for at least four years, five years.

Q: Who is "we"?

MR. HADLEY: The President of the United States, the administration has used it. I think if you go back to the June 24, 2002 speech, I think you will find this phrase: "To end the occupation that began in 1967." You know, one of the reasons we did this -- people who say, well, is there anything new here -- one of the things is that people have forgotten an awful lot. And one of the reasons the President wanted to give this statement was, it's what he was beginning to hear from the parties. It is in a new context. Some of the language has evolved over time. There are some new elements. But in addition, public has forgotten how much has been said and needs to be reaffirmed by the United States President as a way of giving impetus to these negotiations. And that's what he wanted to do.

Q: That's why I was pushing you on the letter yesterday. All right, the other piece of language that I wanted to ask you about is this use of the word "contiguous," and when President Bush, in his statement just now, says, for example, "They must ensure that the state of Palestine is viable, contiguous, sovereign and independent" -- what exactly does the President mean when he uses the word "contiguous"?

THE PRESIDENT: That is also something that we used and the President used in his June 24, 2002 speech. I think you will also find it a little bit more expansively discussed in the July 2007 speech that he just gave. What he's thinking about, as he said, when he was asked about it, it's not going to be a Swiss cheese state. Remember, four or five years -- three or four years ago, a lot of people thought that Prime Minister Sharon had a plan to give basically a Palestinian state which was a Swiss cheese state, where large portions of the West Bank would be retained by Israel. And what we wanted to make clear was, in our judgment, that was not the way you get a state for the Palestinian people that is viable politically and economically.

So it has to be a state that coheres, that coheres as a political entity, that coheres as an economic entity if it is going to provide what it should provide, which is a better life for the Palestinian people.

Now, what that's actually going to look like, how much territory, is it all going to go back, is it less than all, how much -- all that's going to have to be negotiated. But it is important to have some principles and concepts, and to get some narrowing of the parties' understanding and emerging agreement on those principles when you go into a negotiation to do the details. And he wanted to, in one place, pull those together, and thought it would be advancing both public understanding of what's ahead and to also help the parties move down this road.

Q: But you just mentioned the West Bank. Does this concept of the importance of contiguity extend to the West Bank being joined up with Gaza somehow?

MR. HADLEY: One of the things that the President has said a couple of times is, this is a two-state solution, not a three-state solution; this is a Palestinian state, which is the way the Palestinians want it, of the West Bank and Gaza. And we talked about contiguity, and there is the issue of both what does the territory of the West Bank look like, is it going to be Swiss cheese; and secondly, what are going to be the linkages between West Bank and Gaza if they are going to be part of a Palestinian state? And that is an issue that the parties understand is before them. They have started to discuss it, and it is one of the issues that they are going to have to negotiate.

Q: And on that issue, has the United States contributed any ideas about linkages?

MR. HADLEY: There is a lot of pressure, I think, for people to -- let me start again. The President made clear that he is not going to try and draft this agreement for the parties. As I mentioned yesterday, there are a lot of conversations the President yesterday had with Israelis, a lot of conversations with Palestinians about what their thoughts are on these various issues. They are sharing thoughts with us. Obviously, we have some response, but we are not at this point trying to outline the elements that should be the outcome of the negotiations. What we are trying to do is get the parties in a process where they can start to outline those elements for themselves.

Q: Steve, if I may, I know you don't want to be seen, or the President doesn't want to be seen as imposing a solution on them. But isn't he, for the first time, outlining the basic parameters -- with the exception of Jerusalem, which he didn't address head on -- but on the question of borders, on the question of the nature of the two states, the right of the refugees to return, all of those he's addressed in one place, in one statement, essentially endorsing an American view of the negotiations that are ahead?

MR. HADLEY: What I said, and what we thought we were doing, is pulling in one place things that, yes, a lot of it the President has said in one form or another before, but the important thing, as I said, was it's what he's beginning to hear from the Palestinian and the Israeli sides. And that's, obviously, what's important, because they're the ones who are going to have to make the agreement.

So do we think we are making progress over time and getting a common understanding of what the outcome of this negotiation looks like? Yes, I think we are. That's a good thing, because we can advance the negotiations to the extent there is agreement on basic principles of what the outcome is going to look like. And I think there has been progress on that score, and that will make it easier for the parties to get into the details.

Q: You said Abbas and Olmert had reached agreement on the modalities for going forward. Does that mean they're going to talk or just that they agree with the three tracks? What's your expectation for ongoing negotiations between the party, or will it only be Frasier popping in every now and then to --

MR. HADLEY: What they said they meant when they talked about modalities is that President Abbas and Olmert would continue to be engaged; they would continue to meet every other week -- I think that's the schedule that they have announced; that Foreign Minister Livni and Abu Allah will be the respective team leaders for the two sides; that they have been and will continue to work very frequently and closely together -- I'm not sure they're going to meet quite on a daily basis, but they're certainly going to meet very frequently -- and that there will be a team supporting each that will be available to address the technicalities of these issues, because they have basically said they are going to address all the core issues, and then in the statement they made two days ago, they laid out what they were. And obviously it's a very, very -- very long list. So that's what I mean -- that's what I think they mean when they say and when President Abbas said to President Bush, we've reached agreement on the modalities of the negotiations.

Q: Can you talk a bit more about the international mechanism, and how it's going to be made up? And is it just going to be focused on this compensation issue or is it going to have other -- potentially other responsibilities?

MR. HADLEY: Still to be determined. As I say, this is an idea that has emerged in the last month or so of conversations. We wanted to put it out as part of the process to advance the discussions. I think that the two sides have not -- have reacted favorably to the concept, but obviously a lot of work needs to be done to develop that concept. Indeed, one of the things that we need to look at is what are going to be the international mechanisms that are going to support the negotiations between the two parties. That's a subject that I think you're going to see being addressed here in the weeks ahead, and getting a little bit more fidelity of what this would look like will be part of that process. But I don't have a lot more for you on it now.

Q: You know full well that events, they can knock off processes like this. When the President is not here -- he's made a lot of -- he's stressed a lot in the last few days that by being here, he's managed to focus the leaders to come back together again. But when he goes away, what will he be doing in practical terms to make sure that they do hold those meetings every two weeks?

MR. HADLEY: Well, we've left a lot behind. Just let me note, for example, that Keith Dayton, General Keith Dayton will continue his work on helping the Palestinian Authority actually develop their security institutions: What is the plan for training, equipping, and standing up Palestinian security entities? He has now asked General Frazier to serve as the head of the monitoring mechanism for ensuring implementation of the road map. This is another prodding agent, if you will, on the ground.

You might also recall that Secretary Rice has asked retired General Jim Jones to step back and help the Israelis and the Palestinians develop a broad security concept for ensuring that Israel and a Palestinian state both are secure in a broader regional environment where there are obviously considerable challenges.

We have obviously our ambassadors in -- and our Consul General here. Tony Blair, as you know, has an important role to play in terms of helping Salam Fayyad continue. So my point is there's a lot of infrastructure we've put on the ground. The President has -- calls these leaders frequently. I think the frequency will go up. I think you're going to see Secretary Rice here quite frequently. You're going to see David Welch and Elliott Abrams here frequently. And as I said earlier, I think you're probably going to see the President of the United States.

So I think, in terms of availability for support and prodding of the process, I think we're in pretty reasonable shape.

MR. JOHNDROE: Last one.

Q: Can you just address the question --

MR. HADLEY: Again?

Q: Yes, sorry.

MR. HADLEY: Is this the fourth question? Does anybody else -- you haven't asked one. I'll come back. I'll come back. I'll come -- a little bit of equity here. A little equity.

Q: I waited.

Q: Listening to President Abbas, I was struck by the same statistic that you cited earlier that 58 percent of the Palestinian Authority budget is spent in Gaza. And especially in light of the $7.5 billion that was pledged in Paris by the donors, and in light of Prime Minister Fayyad's statement when he came into office that all of the controls that had been so painstakingly and with such great effort set in place at the end of Arafat's life were all gone, what are we doing to ensure that this money is being spent in a way that's going to be productive for the Palestinian people, especially in Gaza where, as you said repeatedly, President Abbas really doesn't have any control over the situation there, and presumably doesn't have that much --

MR. HADLEY: I haven't said that --

Q: -- control over the money that's --

MR. HADLEY: -- you have said that. And let me reframe your question, if I can, because it's an important one. What is Salam Fayyad, as Prime Minister in this Palestinian Authority, what is he going to do? You know, he's the guy who put up all these controls. And he is concerned about this. But he obviously recognizes there is an humanitarian crisis in Gaza and there continues to be a presence. There continues to be a Fatah presence; there continues to be a limited presence in the form of people in the Gaza that are getting their salaries from the central government. And it's very important, and he said that very clearly: We are not turning our back on Gaza. We want to be able to expand our ability to help the people of Gaza. And so he doesn't want to cut off this flow, but obviously, it's difficult because he doesn't have the kind of infrastructure -- I think he would tell you he doesn't have the kind of infrastructure there he would like.

But the message that he would like us to send to Arab countries in the balance of this trip is, if you are concerned about the humanitarian situation in Gaza, give money to the Palestinian administration, because they have a way of getting funds into Gaza in a way that they believe does not support terror, but does relieve human suffering.

Q: But are you saying that those controls are entirely on his end, so we're going to provide this money and it's going to be up to Prime Minister Fayyad --

MR. HADLEY: We don't have a presence in Gaza, and haven't for a long time.

Q: Right. And you -- and especially looking at the ease with which Hamas was able to dispose of the Fatah security infrastructure, you don't worry that that 58 percent of the budget is going to go straight into -- or a lot of that is going to end up in the pockets of Hamas?

MR. HADLEY: We worry about it. Salam Fayyad worries about it. He and President Abbas have no interest in strengthening Hamas. On the other hand, there are people -- the Palestinian Authority is not going to give up the proposition that they are the rightful governmental authority in Gaza. And to the extent that there are people there who continue to be employed by the Palestinian administration, he wants to pay their salaries. If you want to get back in and restore the status quo ante to the Hamas coup, the last thing you want to do is stop the money flows. Are there risks? You bet. Are they concerned about it? Sure. Are we concerned about it? Sure.

Q: How about an Iran question?

MR. HADLEY: You're number two. We'll go for a second round, a limited second round; in your case, a fourth round.

Q: I know, I know, I know. Hopefully I'm covering things that people are interested in.

MR. HADLEY: Can we have a show of hands on that issue? (Laughter.) Your colleagues support you, Martha.

Q: Good, good. What was Abbas told about the security situation in Gaza? I know Olmert yesterday said it would be very difficult to come to any sort of peace agreement without -- with the terror continuing in Gaza. What do you expect Abbas to do about that?

MR. HADLEY: Well, it's what Abbas wants to do. Obviously, the negotiations can go forward on a peace agreement, but can that peace agreement be implemented and a Palestinian state be stood up with rockets still coming out of Gaza onto Israel? That's a challenging proposition. And it's also not a proposition I think President Abbas and Prime Minister Fayyad want either. They want a Palestinian state that includes Gaza. They want to have the return of Palestinian administration to full authority in the Gaza.

And I think one of the things that the President had talked about is, when they have negotiated the vision for a Palestinian state, what it's going to look like in terms of its territorial outline and political institutions. He wants to put that to the people of Gaza so that they will, in some form, have a choice: Do they want to stay with the desperate situation they are in now, or do they want to become a part of the emerging Palestinian state, and invite the Palestinian administration back in so that they can begin to administer Gaza and the West Bank as an independent homeland for the Palestinian people? That's where he wants to get.

Last two questions. Yes.

Q: Still on this topic. When the President in his statement said --

MR. HADLEY: Do I think he'll come back to Israel? Yes, I do.

Q: Sorry, that was just an injection earlier.

Q: And during his term?

MR. HADLEY: Yes, and yes.

Q: What was I going to ask? (Laughter.)

MR. HADLEY: You can have a minute reprieve. Go ahead.

Q: No, no, no.

MR. HADLEY: I'll come back to you. I promise, I'll come back to you.

Q: The various Israelis that the President met with today, what sorts of reassurances did they seek from him, beginning with Bebe Netanyahu? Did they specifically ask for a clarification of the NIE, and what did he tell them?

MR. HADLEY: The President said in private what he said in public: Iran was a threat before the NIE, was a threat on the day the NIE was issued, and continues to be a threat after the NIE has been issued. They continue to pursue the enrichment of nuclear materials, which gives them the know-how to develop fissile materials that they could put into a nuclear weapon; they continue to pursue ballistic missiles, a means to develop them.

And the nightmare we all have is, the world now having been satisfied by the NIE that they suspended their weaponization effort, one of the things he worries about and various countries we talk about, is that they will go ahead and use this -- the NIE as a basis for starting up the program again. And that's a concern. It's a worry he has, and it's a worry he heard from the Israeli side, and it's a worry, quite frankly, we've heard from many other allies.

So he continues to think this is a problem that, as he said -- he says the same thing privately that he says publicly: It is a problem. It needs to be handled diplomatically. And he is going to try and rally the international community to put more pressure on Iran so that its leadership will make a different kind of choice for the Iranian people.

Q: One quick follow-up. As you know, there have been some discussions among Israelis both in the media, among Israeli officials, about the idea that they might have to -- the Israelis might have to take unilateral action of some kind.

MR. HADLEY: I'm going to miss my ride to dinner. (Laughter.)

Q: Did he attempt to persuade them not to do so?

MR. HADLEY: Never miss the motorcade is the first rule. (Laughter.) Quickly, and then yours, then I've got to go.

Q: Did he attempt to persuade them not to take unilateral action of any kind -- did the Israeli officials he met with today -- against Iran?

MR. HADLEY: He's said to them what he's said in public: We need international effort to put pressure on Iran so their regime will make a different choice.

Yes, ma'am. Last question.

Q: If the President could get one thing from his trip to the Gulf Arabs in terms of supporting Israel, as he said in his statement, what would that be? And on the atmospheric side, who did he have to be tougher with behind closed doors, the Palestinians or the Israelis, in this trip?

MR. HADLEY: You've got the wrong sense of the meeting. These were positive meetings where they came to him and explained what they were doing and what their aspirations were to do together.

And first part of your question?

Q: The Arabs, Gulf Arabs --

MR. HADLEY: One -- they can do a lot of things. One, they can provide diplomatic support to President Abbas as he makes difficult choices and decisions in the negotiations. Two, they can give him greater financial support, particularly to his budgetary support, so that he can continue to run his government. And three, they can begin to -- consistent with the spirit of the Arab League initiative, they can begin to reach out to Israel and indicate in a tangible way that they support this diplomatic process.

Thank you. I'm sorry I've got to go.

END 6:34 P.M. (Local)

George W. Bush, Press Briefing by National Security Advisor Stephen Hadley on Israeli-Palestinian Peace Process Online by Gerhard Peters and John T. Woolley, The American Presidency Project

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