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explicit. I told President Clinton I could speak only for how I would respond if a
state was indeed declared without a peace deal. “We will extend Israeli sovereignty
over the major settlement blocs. We will establish a security zone in the Jordan
valley, and let them know that there will be a heavy price should they attack any of
the outlying settlements.” In other words, Palestinian unilateral action would
prompt unilateral Israeli action. “And the confrontation will begin.”

* * *

Clinton seemed, if not completely revived, considerably more upbeat when he
came back to see me an hour later. He told me that he had received the
Palestinians’ answer. The way he described it to me, Arafat had agreed to leave
President Clinton to decide the amount of West Bank land that would go to a
Palestinian state, a figure he now told me that he was assuming would end up at
around 90 to 92 percent. The trade-off, he said, would be a limited, “symbolic”
land swap. Arafat also wanted control of the Jordan Valley, but had agreed to
begin negotiating on Israeli security needs there as soon as possible. Then, came
Arafat’s counter-conditions, which appeared to bother the President much less than
they did me. Everything would be contingent on an unspecified, “acceptable
outcome on Jerusalem.” And despite Clinton’s emphasis that any meaningful
agreement had to include a formal declaration that the Israeli-Palestinian conflict
was “over,” Arafat was insisting that could come only after the terms of whatever
we agreed were fully implemented.

Still, it was at least a step forward. Clinton seemed genuinely encouraged, and I
didn’t want to risk closing off this first chink of light. I suggested, for instance, that
we could address Arafat’s reluctance about an “end of conflict” statement by
providing an American guarantee that the terms of the deal would be implemented.

Still, it very soon became clear that any hope of real progress rested on by far
the most difficult issue: Jerusalem. Across party boundaries, even across divisions
between religious and secular, nearly all Israelis viewed the city as not just our
capital, but the centerpiece of the state. It had been divided after 1948. The Old
City, and the site of the ancient Jewish temple, had been under Jordanian rule for
19 years when our forces recaptured it in the Six-Day War. It was under a Labor

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