Somewhere, Ariel Sharon is smiling. The Israeli prime minister has plenty of reason to be pleased with President Bush's latest iteration of Mideast policy. On Monday, Bush declared that the Palestinians must elect new leaders if peace in the Mideast is ever to become reality. The speech may be controversial, but it won't do much to quell the violence in the region. For that, Bush must detail how he plans to balance Palestinian and Israeli concerns, while keeping Arab allies on board in the war on terror.

That won't be easy. In Bush's view, responsibility for ending the murderous cycle of violence that has consumed Israel and the Occupied Territories since the current intifada began in September 2000 rests almost entirely on the Palestinians. Bush demanded that they oust their leader and replace him with one more palatable to Washington, build a "practicing democracy based on tolerance and liberty" (a standard not yet met by any of Washington's Arab allies) and stop the attacks on Israel. The carrot: Perform those tasks to U.S. satisfaction over the next 18 months and the Palestinians will get a provisional state in those territories currently designated as under Palestinian Authority control — in other words, a return to the failed 1993 Oslo deal, but with the Palestinian Authority now called a provisional state. A final political agreement would follow within three years.

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nginx/1.14.0 (Ubuntu) There's nothing in Bush's speech for Arafat (except perhaps the hint that he may want to start looking for a realtor in some distant Arab capital), and little for the Palestinian in the street to hang on to. And for those moderate Arab regimes allied with the United States, the speech is likely to be a bitter disappointment. For the Egyptians, Saudis and Jordanians, the quid-pro-quo for ending the conflict had been an Israeli withdrawal to the 1967 borders. What they got was an exhaustive set of political and security demands on the Palestinians in exchange simply for a return to the dead-end situation of September 2000. President Bush sounded a clear warning that he wanted no whining from any Arab allies, reiterating that "you're either with us or against us." For good measure, they're expected to help get rid of Arafat and implement the Bush plan for Palestinian democracy, and then normalize diplomatic and trade ties with Israel.

The more urgent problem, though, is that the security situation in Israel continues to deteriorate. As Bush spoke, all but one of the major Palestinian cities on the West Bank were under Israeli military control, and the speech hasn't changed the reality on the ground — Palestinian militants plan to continue launching terror attacks inside Israel, and Israel plans to keep its troops in Palestinian towns until such attacks cease. Even if the Israelis take the President's address as a green light to expel Arafat, nobody believes there's going to be any Palestinian reform as long as Sharon's forces are inside PA territory. Bush did call for Israeli forces to withdraw to the positions they held before the onset of the current intifada, but he didn't specify any timetable. And plans to have Secretary of State Colin Powell fly out immediately to the region to press for implementation of the Bush agenda have been shelved.

For now, violence will continue to escalate. And that poses a dilemma for the Bush administration. When Israeli troops made their first incursions into the West Bank in April it threatened Washington's relations with key Arab allies in the war on terror. Al-Qaeda is certainly well aware of the connection, which is why its latest al-Jazeera advertorial tries to paint the Israeli-Palestinian conflict as al-Qaeda's very raison d'tre. In response to pressure from Egypt, Saudi Arabia and Jordan, the Bush administration has agreed to launch a new diplomatic intervention. But there's little reason to believe the vision outlined in Monday's speech will be enough to staunch the bleeding.

Bush's speech recognizes that two of the key ingredients for peace are an end to Palestinian terror attacks on Israel, and an Israeli withdrawal from Palestinian territories. On the basis of the current security situation, those goals may be mutually exclusive, which means that the White House still has a long way to go before Israelis and Palestinians are both satisfied.