Inside the Talks

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Yasser Arafat had ordered his Challenger jet at Andrews Air Force Base to take him home. Ehud Barak told aides to begin drafting a statement giving his version of why the summit had collapsed. But at literally the 11th hour last week, the Palestinian leader and the Israeli Prime Minister decided to remain at the Camp David presidential retreat in Maryland's Catoctin Mountains to see if they could agree to end their 52-year-old conflict. An exhausted Bill Clinton flew to Okinawa early Thursday morning to attend the G-8 economic summit, leaving Secretary of State Madeleine Albright behind to keep the two sides inching closer to a deal until he returned this week.

It had been a grueling two weeks for the principals, but just as intense has been the dogged diplomacy that got them to Camp David in the first place. Time has followed the diplomats behind the scenes for seven months as they trudged along the road to peace. Our exclusive report:

Wednesday night, Feb. 2: Dennis Ross, the State Department's top Middle East peace negotiator, was gloomy. Ehud Barak was a breath of fresh air after Benjamin Netanyahu, who had spent his tenure as Israeli Prime Minister throwing up one roadblock to peace after another. Barak truly wanted a treaty with the Palestinians. But Ross was still finding himself neck-deep unsnarling disputes between the two sides. Barak and Arafat were scheduled to meet the next day at Erez Crossing, the entrance to the Gaza Strip, and Ross was sure the summit would be a disaster. The two leaders were supposed to discuss the transfer of another tract of Israeli-occupied territory, land Arafat had been promised under an agreement he'd signed two years earlier with Netanyahu. A simple enough real estate exchange, but in Middle East negotiations nothing is simple.

The two men were angry. Barak was fed up with Arafat's tantrums over the transfers. Arafat felt insulted. Barak was giving him no say in what land was being transferred and, even worse, the Palestinian leader complained to Ross, publicly snubbing him on it.

Israeli and Palestinian negotiators had spent 10 days behind closed doors trying to come up with a framework agreement by Feb. 13. At a private dinner the week before, Arafat had asked Barak if he would include three Jerusalem suburbs in the land transfer. Barak said he'd consider it.

Two days later, Arafat got his answer from an Israeli radio station. Israeli officials had leaked the news that Barak would not turn over the suburbs. Barak, who had been meticulous about protocol in the past, insisted the leak was inadvertent, but Arafat fumed that this was an affront designed to embarrass him.

Ross shuttled between Arafat's Ramallah compound and Barak's office in Jerusalem until the early morning hours of Feb. 3 trying to patch up the spat or, if that couldn't be done, to convince Barak to postpone the summit. But Barak insisted on going ahead with the meeting and, as Ross predicted, it ended in a bitter public deadlock. A framework agreement by Feb. 13 was out. Senior Clinton aides began to question whether Barak had bitten off more than he could chew. He had plunged into simultaneous negotiations with the Syrians to exchange the Golan Heights for peace, but those talks were stalemated as well. On the Palestinian track, Barak and Arafat had been playing tough to assuage their constituencies. Now bruised egos were gumming things up even more.

Monday, Feb. 28: After a week of cajoling, Ross finally got Barak and Arafat to resume negotiations on the land transfer, but the personal rift had not yet healed. Arafat also fretted that he was being ignored while Barak chased a quick deal on the Golan Heights, and had begun referring derisively to the Syrian negotiations as "the other woman." The two men were communicating only through Ross.

Ross decided to leave town. It would force Arafat and Barak to speak to each other. The ploy worked. By March 8, they had agreed to revive their talks. Arafat would have a say in what land he got in the next transfer, another tract of the occupied territory was promised to the Palestinians by the end of June, and the two sides would restart negotiations on a final peace agreement.

March-April: Progress at last. Israeli and Palestinian negotiators secluded themselves at Bolling Air Force Base near Washington D.C. Prodded by Ross's team, they began brainstorming about how a final peace agreement might look. After two rounds of talks, the negotiators had settled on an outline of what issues were essential to it. Ross flew to the Middle East to brief Barak and Arafat on progress.

Barak was encouraged as well. With the Syrian negotiations at a standstill, he convinced Arafat to open back-channel communication. As long as the front channel meetings were made public even if their content wasn't leaked Barak felt Arafat would never divulge to his negotiators, Saeb Erakat and Yasser Abed Rabbo, the real flexibility he had in his so-called red lines. What's more, the Israelis had never liked dealing with Erakat; they thought he slowed down the talks by dwelling on details of past agreements and old promises. So Barak sent his Internal Security Minister, Shlomo Ben Ami, and a lawyer and friend from his army days, Gilad Sher, to meet secretly with top Arafat lieutenants, Abu Alla and Hassan Asfour first in Sweden, then in Israel.

The two sides began putting meat on the skeleton. The Israeli team was hopeful. The Palestinians, for the first time, began hinting that they might be flexible on their maximalist positions. Ross and his deputy Aaron Miller (the two men had been nicknamed "the peace brothers" in the State Department) were excited as well. The teams were still haggling, but over an actual agreement. Before, they had just been stalling.

Monday evening, June 5: To put them in a mellow mood, Barak and his wife, Nava, laid on an elaborate Japanese-themed meal at their Jerusalem home for Albright and her visiting peace team: salmon and sushi arranged on bark from Israeli forests garnished with moss and white roses.

The Secretary of State was touched. But she was also a woman in a hurry. Bill Clinton had just seven months left in office to broker a deal, and Arafat was threatening to declare a Palestinian state unilaterally if there was no peace agreement by the end of the year. After dinner, Barak and Albright walked off by themselves to the family garden. Albright warned Barak: "We can go through another breakdown or we can get a deal now." Barak was ready for Clinton to host a peace summit with him and Arafat. But he was in no mood for any more threats from the p.l.o. Palestinians had rioted in the Gaza Strip and West Bank the previous month, just as he persuaded the Israeli parliament, the Knesset, to agree to the transfer of the Jerusalem suburbs Arafat wanted.

The next day, Albright drove to Ramallah for a sumptuous lunch at Arafat's Muqata'a compound. Albright and her aides marveled at how warm and sociable Arafat and Barak were when each man met separately with the American team; if only they could be that way with each other. Arafat, however, now vented his frustrations with Barak. The Israelis still had not turned over territory promised from past accords and they continued to build settlements on disputed land, some of which had belonged to Arafat's family.

Albright convinced both men to send their negotiators back to Washington the next week.

Tuesday, June 27: Albright was back in Jerusalem. The negotiators had made no headway in Washington, and Barak, facing revolts within his coalition government, had again delayed the suburbs transfers. The good news was that Barak aides had begun leaking the compromises their boss was considering, to prepare the Israeli public for a peace deal. But Arafat wasn't doing the same with his people, Albright and her peace team worried.

Barak wanted to move quickly to a summit, calculating that it would force Arafat to begin making hard choices. Arafat wanted more negotiating by the diplomats before he walked into the same room with Clinton and Barak. Israel had a far better spin operation, particularly in the U.S., he believed. If the summit failed, the press would blame the Palestinians. Albright proposed another compromise: Arafat would get more prep time than Barak wanted, but a summit would be convened by mid-July.

Back at the White House, Albright and Clinton decided on a date: July 11 at Camp David, where Jimmy Carter had brokered a peace 22 years earlier between Israel and Egypt. It would be make or break.

Wednesday, July 19: For nine days, Clinton had cajoled and pleaded with the two leaders. But progress had been so slow that he was ready to give up and fly to Okinawa, where he was already late for the G-8 summit. The hangup: Jerusalem. Arafat demanded that the Palestinians have sovereignty over East Jerusalem, but Barak was willing to give him no more than authority over municipal services in that section of the city. The two sides also hadn't agreed on borders for a future Palestinian state and the number of Palestinian refugees who would be allowed to return, but the negotiators believed these gaps could be bridged once they decided the fate of Jerusalem.

Barak and Arafat had begun complaining to Clinton that the other man wasn't negotiating seriously. Each had threatened to walk out. Frustrated, Clinton called their bluff. He ordered his motorcade to be assembled to take him to Air Force One for the flight to Okinawa and had one of his spokesmen announce that "the summit has come to a conclusion without reaching an agreement." It worked: within an hour the two leaders told Clinton they would stay at Camp David with Albright and continue negotiating. A bleary-eyed Clinton told reporters before boarding his jet: "Nobody wanted to give up."