More blew apart than the 22 lbs. of explosives in the car on Shomron Street. Yasser Arafat's shaky entente with Palestinian Islamic extremists also perished in the blast. Throughout the bloody weeks of the Aqsa intifadeh--named for the holy site that inspired the latest clashes--the Chairman had taken a line with the Israelis so hard that Hamas and Islamic Jihad were prepared to take a back seat, for the most part. But all along they watched him warily, worried that he would abandon their hard-line tactics in favor of diplomatic dealmaking. When he did, by striking a bargain with former Israeli Prime Minister Shimon Peres, the Palestinian hard-liners hit out immediately, with the car bomb. It left the Middle East with a deceptively simple question: Would this attempt at a cease-fire, the fourth in five weeks, hold? Or would the most militant arms of the Palestinian cause use it as an excuse to sever the new ties with Arafat that appeared to have brought them in out of the cold, in favor of extremist murder?
If there is hope for this latest deal, it was conceived in an armored limousine zipping through an Indian summer night to Gaza City last Wednesday. Shimon Peres, who won a Nobel Peace Prize for his founding role in the peace process, sat in the back of the limo with Gilead Sher, Barak's top peace negotiator. The Prime Minister had charged Peres and Sher with pulling Arafat back from the brink. The two men knew the urgency of their task. The previous night, gun battles had raged between the Jerusalem suburb of Gilo and the Palestinian town of Beit Jalla. Israel had fired tank shells and missiles. An Israeli security guard had been shot in East Jerusalem, and even as Peres set off for Gaza a pipe bomb exploded near the Jerusalem Theatre. Peres knew that to travel from Jerusalem to Gaza, a distance of 50 miles, is, in terms of the perception of the fighting, a voyage to a different world. Peres told TIME he tried to put himself in Arafat's shoes. "What's on his mind? I must not judge him," Peres said he thought. "He feels that he's in a desperate situation."
Once in Gaza, Peres sat back and listened to Arafat complain. The excitable Palestinian leader inflated the numbers of dead and wounded and sneered at measures Israel thought of as concessions. "I sensed an unbelievable gap," Peres said. But over dinner Peres calmed Arafat. After they ate a dessert of kunafeh, sweet semolina topped with shredded wheat and syrup, Peres and Arafat talked alone. By half past midnight, they had a deal. Arafat agreed to end the shooting--though not the stones and the Molotov cocktails. In return, Peres would persuade Barak to pull back some of Israel's tanks and troops from friction points in the West Bank and Gaza Strip.
With the Palestinian public angered by the endless funerals of youths shot by Israeli soldiers, Arafat was in a precarious situation. His Palestinian Authority issued a statement announcing an end "to violent and armed confrontation." But his officials said the "peaceful" confrontations would continue. The Israelis were worried that Arafat would try to avoid a clear call for peace. Just before 1 p.m. on Thursday, aides of Barak say, he called Arafat to coordinate the simultaneous broadcasts of the two leaders announcing the cease-fire. "In one hour, when we make our announcements, I want to be sure you won't omit anything," Barak said. Arafat responded, "I'm ready." Instead, the bomb on Shomron Street came. Though he didn't make the broad statement Barak had hoped for, Arafat condemned the bombing. That, at least, was welcome news to Barak's office. "We are witnessing a better, more genuine effort by Arafat to really guide his forces to reduce violence," says Sher.
Arafat's aides say he recognizes a need to defuse the situation. He knew Israel's army was itching to punch harder. In fact, the deputy chiefs of staff of Israel's army, military intelligence and domestic intelligence service were pushing for a tougher response after the shooting deaths of three Israeli soldiers on Wednesday. Their plan, vetoed by Barak, included risky, lightning strikes into Palestinian villages by undercover forces dressed as Arabs. Arafat feared that the conflict would spiral into a full-scale war. Sources close to Arafat say he made contingency plans to flee to Yemen or Iraq if Israel tried to retake the Gaza Strip. He knows that his 34,000 lightly armed paramilitaries can't stand up to a real onslaught from Israel, which has standing armed forces of 186,000 and some of the world's most sophisticated weaponry. The mayors of Bethlehem, Beit Jalla and Beit Sahour, three Palestinian towns south of Jerusalem, faxed Arafat's chief of National Security Forces in the West Bank, Tawfik Tirawi, begging him to restrain the gunmen whose sniping drew Israeli retaliation on their citizens.