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Obama presented bitter truth: Indyk. -

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Former US ambassador to Israel Martin Indyk discusses the prospects for the resumption of Middle
East peace talks.


ALI MOORE, PRESENTER: To discuss the prospects for the resumption of Middle East peace talks, I'm
joined from Washington by Martin Indyk.

He's the vice president for foreign policy at the Brookings Institution and a former US Ambassador
to Israel.

Martin Indyk, welcome to the program.


ALI MOORE: Why has the president, do you think, chosen now to put the focus on the
Israeli-Palestinian peace process, a time when really very few people see any prospect of progress?

MARTIN INDYK: That's correct, and that includes the president himself.

You notice that he didn't announce that he was dispatching the Secretary of State for a renewed
effort or even replacing his special Middle East envoy George Mitchell, who resigned.

So he doesn't think there's much prospect at the moment.

The timing actually has more to do with the revolutions going on in the Arab world and the need for
the president to frame America's approach, and people seem to forget that the speech on Thursday
that he made was really three quarters about that and only the residual part was dealing with the
Israeli-Palestinian issue.

But with the prime minister of Israel coming to town the next day and his extraordinary upbraiding
of the president in the Oval Office, this became a drama that everybody was focused on, and it's
not over yet.

We've only seen the second act; the third act will take place today when Benjamin Netanyahu
addresses APEC. And then the fourth act will be on Tuesday when the Israeli prime minister
addresses a joint session of Congress for which he will in both cases get resounding applause,
prolonged standing ovation.

So it's still going to play out.

But what's most interesting to me is that the president basically put down some bitter medicine in
his Thursday speech by saying that Israel and the Palestinians would need to negotiate a border
between them based on the 1967 lines with agreed swaps.

He sugar-coated that medicine yesterday at APEC, and it's been swallowed, and the prime minister
came out last night and said that he welcomed the president's remarks. So I suspect that at the end
of the day, with all of the drama going on, nevertheless the president will have established the
basic point that negotiations, when they do resume, will have to be based on the 1967 lines with
agreed swaps, and that actually will be not bad for a day's work.

ALI MOORE: Well, as you say, not bad for a day's work. I mean, how significant is it that that has
been said by the president? Has he gone further than previous presidents?

Because of course that very phrase was used by Hillary Clinton, for example, just a couple of years
ago. Is a significant part of this the fact that it came from the president?

MARTIN INDYK: Yes, indeed and it wasn't used by Hillary Clinton in that way. If you go back and
look at her statement she was talking about the need to reconcile that which was at that moment a
Palestinian demand, with Israeli requirements on other issues.

All the way back to 1069 when secretary of state Bill Rogers - nobody will remember him - first
talked about the need for a settlement that would require minor border rectifications on the 1967
lines. But he didn't specify the 1967 lines at that time.

Bill Clinton, at the end of his administration, put down the Clinton Parameters. He didn't say 1967
lines, but he said that the state would have to be established in 94 to 97 per cent of the West
Bank, which means 1967 lines minus three to five per cent, three to four per cent for swaps.

So, presidents - also president Bush said it needs to be based on the 1949 lines, which is the same
as the 1967 lines, and he also referred to swaps.

But nobody has come out, no president of the United States has come out clearly with this as the
starting point for the negotiations. It's been a long-time Palestinian demand and it's something
that the Likud government of Bibi Netanyahu has resisted mightily up to now, but I suspect at the
end of the day, indeed when negotiations start, it will be on this basis.

ALI MOORE: This speech, or these speeches, they also held challenges for the Palestinians, didn't
they? I mean, he criticised the recent agreement between Fatah and Hamas and the president also
reiterated the request that the Palestinians drop their appeal for recognition at United Nations?

MARTIN INDYK: Yes, and that was the sugar-coating on the pill. He said some strong things about
preventing that unilateral action at the United Nations.

And I think this is the key to understanding what his strategy is at the moment. It's not to
relaunch negotiations, but it's to head off that UN General Assembly move. If 160 nations then
support this recognition of an independent Palestinian state, that will then move very quickly to
the Security Council.

He's vowed to veto it in the Security Council, but if the United States does that against the will
of the vast majority of the international community, then he's going to be on the wrong side of the
Arab street, which is what he was trying to get on the right side of in Thursday's speech.

So he's got a real dilemma coming down the track and he wants to avoid that, head it off by, on his
way to Europe, putting down this principle of negotiations based on the 1967 line, and then saying
to the European leaders that he'll be meeting with in the next four days, "Come on board with me,
let's work together to try to get negotiations going," and thereby peel them off from support for
the UN General Assembly resolution.

If he succeeds in doing that, I think Abu Mazen will think twice about alienating both the United
States and the Europeans by this unilateral move.

ALI MOORE: If the aim is not to restart negotiations and as you say it's aimed more at that UN
resolution, is there also though not an issue of time being of the essence? You've got elections
coming up in Egypt. How crucial is that regional picture to this call for a restarting of peace
talks, whenever that may happen?

MARTIN INDYK: I think that's a very good point.

The elections in Egypt will take place in September, about the same time as this resolution is
going to be pushed by the Palestinians into the General Assembly.

The Egyptian Parliament is likely to be much more responsive to popular demands and popular mood,
and we can already see some Egyptian politicians demagoguing the issue of Israel to gain votes.

So one can assume that the Parliament is going to be quite hostile to Israel. And then we don't
know what's going to happen in the meantime through the long, hot summer in the Palestinian arena.

We already have Palestinians unarmed coming across the Israeli borders, Lebanon and Syria. That may
well be stepped up, and then we may see large-scale peaceful demonstrations by unarmed Palestinian
demonstrators in the West Bank.

How the Israeli Army is going to respond to all of this is a very big question mark, but they're
not equipped for crowd control. And so if there's large-scale casualties, an Egyptian Parliament
that's hot to trot and the vast majority of the international community supporting a Palestinian
state at the United Nations and declaring Israel an occupation, you've got a kind of worst-case
scenario, not only from Israel's point of view, but from the point of view of the United States.
And that's what I think president Obama is focused on.

ALI MOORE: Who's driving Middle East policy at the White House right now? Of course George Mitchell
who was the advisor, he's left. There have been some saying the policy area's been in turmoil in
recent weeks. Who is in the driving seat?

MARTIN INDYK: President Obama. He is very much his own foreign policy advisor. There's been a
contentious debate within the administration for the last five months about whether to give a
speech, when to give the speech, what to put in the speech, and that debate went on right up until
the last moment when the president decided to put the 1967 lines in there.

There's lot of attention being focused on my friend and peace partner colleague Dennis Ross, but I
think that's much exaggerated in the game of trying to point fingers.

But in reality, there's a real argument about what's the best way to move forward. Is it with
Israel, with the president's arm around Israel, or is it best to beat Israel over the head? And if
only prime minister Netanyahu would take an initiative, and that's mainly been the quiet game
that's been going on for the last five months, then the president would get behind that initiative.

But Netanyahu's reluctance up to now to take an initiative - and of course he's got good reason,
the whole region around him is in turmoil, Fatah just joined with Hamas, Hamas doesn't want a
two-state solution, it wants to destroy Israel, not make peace with it.

So he's hesitating, he's not prepared to move and the president is saying to him, "Listen! The
house is on fire! We got to work together to put it out and here's what we need to do." And the
first reaction from the prime minister was his bellowing as if he was a cow being taken to the

But I think now he's, having used it to generate support on his right wing, he's calming down. And
I think he understands the reality too that you can't stop something with nothing. And it's much
better for the United States and Israel to be working together to try to find a way forward into
meaningful negotiations with the Palestinians than to sit back and let the house burn down.

ALI MOORE: So, just finally and briefly, Martin Indyk, I take it from what you're saying that as we
see this third and fourth act play out over coming days, is it fair to say you're optimistic that
there may be some trigger for these talks to restart?

MARTIN INDYK: Well, optimistic would be pushing it a little bit too far. The situation is very
difficult, as I've described it, on the ground.

You don't have leaders on the Palestinian or Israeli side that seem willing to take courageous
risks and be statesmanlike in the circumstances. But the president's need to make something happen
is providing a sense of urgency which I think he may succeed in imparting to the other two leaders,
and then we'll have to see.

ALI MOORE: Indeed we will. Martin Indyk, many thanks for talking to Lateline tonight.

MARTIN INDYK: Thanks for having me.