Ladies and gentlemen, I would like to thank the World Affairs Council for providing me this opportunity to take the place of Ambassador Ayalon on this occasion.  The Ambassador asked me to convey his sincere apologies to you, but the outbreak of the war in the Persian Gulf simply precluded him from leaving his post in Washington.  Nevertheless, I am most delighted to be able to have this dialogue with you during these important moments in the history of the Middle East.

Let me begin with a personal reflection.  My term in office as Consul-General has not gone according to plan.  Assuming my post some three and a half years ago, I had expected to be the diplomat to represent Israel as we took the final steps to reach a historic peace agreement with our neighbors.  I had planned on pursuing a completely new political agenda.  I was preparing for the development of a Middle East focused upon modern technologies and the global economy.  A more sophisticated, integrated, and open region that would simply not allow itself to be perpetually held hostage to the curse of war.  I was preparing to represent the virtues of our software designers, and not the tactics of our military operations.  I was busy explaining why Israelis and Arabs had come to the conclusion that they could gain more by developing megabytes of disk space than megatons of weaponry. 

I was working under the assumption that a new generation of Arabs would be motivated by providing clean homes and neighborhoods for their families, and would no longer be convinced by hysterical calls of jihad.

I thought that by the end of my term of service in Los Angeles, our biggest concern might have been fitting everyone in the Hollywood Bowl for the peace celebrations we would be organizing.

Instead, as you well know, this agenda was completely derailed.  Instead, two dates in September came to shatter so many dreams and opportunities.  The dates:  September 28, 2000 and September 11^th, 2001.

On September 28, 2000--  a tragic decision of a truly historic dimension was made by the Palestinian leader.  On that day, seven years of negotiation and hope were needlessly undermined.  Presented with a fair and just proposal to address the national aspirations of the Palestinian people, Yasir Arafat opted instead to embrace the path of violence, intimidation, and terror.  We have continued to pay the price for his decision until this very day.  It is a price paid with the stains of bloodshed.  It is a price paid by the cries of our orphans, by the tears of our grieving parents, and by the images of horror that have been marked into our nation's consciousness.

The image of the Dolphinarium discotheque, where the lives of the young Russian immigrant schoolgirls were extinguished forever.  The image of the Sbarro pizzeria in Jerusalem, where entire families were butchered and destroyed.  The image of the Passover massacre in Netanya.  The burned buses.  The lives that have been shattered forever.  Name after name.  Tragedy after tragedy.  Each of our victims had a warm home and loving family.  Each had hopes and dreams for the future.  In all, as a result of the nearly 14,000 Palestinian attacks directed against our citizens, we have paid a deep and heavy toll:  seven hundred and sixty one Israelis have been murdered and more than 4,000 have been wounded.  These include children who have lost eyes and arms and legs.  These include the most innocent among us.  Those whose bodies have been torn apart by the screws and nails exploding into their bodies.   All told,  more than 70% of our casualties have been unarmed civilians. 

At the same time, we are also paying a price in economic terms:  unemployment has crossed the 11% threshold, and our economy suffered negative economic growth in the past year for the first time since 1953. 

The Palestinian people have themselves paid a heavy price for the decision of their leader.  Palestinian unemployment is well over 30%.  The Palestinian GNP has declined by $5.4 billion, the equivalent of one year's income of all the residents in the territories. 

This is a tragedy for them, and it is a nightmare for us as well.  This is a point I cannot sufficiently stress:  Israel takes no comfort in the hardships of the Palestinian people.  We do not benefit from their distress, nor do we wish to perpetuate it. 

If anything, we understand full well that a thriving Palestinian society and economy is one of the best possible engines to provide us better security and tranquility. 

But their  campaign of terror has been launched with an animosity that repudiates the value of human life.  And please, make no mistake... the terrorists do this not in order to validate themselves, but rather to negate us.  Not to free themselves, but to confine us. Not to destroy an occupation, but to destroy Jewish sovereignty. To deny the Jewish people the right of sovereignty in any part of the land of Israel.

Ladies and gentlemen.  There is no cycle of violence.  If the Palestinian terror factions had ceased operations for even a day, this conflict would have ended long ago.  And now, perhaps it's not just Israelis who know this, but Palestinians as well.  In recent months, more and more Palestinian leaders have spoken for the first time of the futility of the path of terror. 

1.   Former Cabinet Minister Nabil Amer blasted Arafat for rejecting the peace proposals made by President Bill Clinton in December of 2000. 

2.   Former Interior Minister Abdel-Razak Yehiyeh has called on all Palestinian factions to cease acts of violence. 

3.   The Palestinian National Security Advisor, Muhamad Dahlan, criticized the unwillingness of the Palestinian leadership to stop armed activity. 

4.   And the recently-designated Palestinian Prime Minister, Abu Mazen, in a speech before the Al-Aqsa Martyrs Brigades terror leadership, declared that Palestinian violence will only bring defeat to the Palestinians themselves.  Abu Mazen went on to say that the only place to confront Israel is around the negotiating table, and not through war. 

My friends... please take note.  Each of these statements were made in Arabic, and were publicized within Palestinian society itself.  These are no longer examples of the time when certain Palestinian spokespeople would condone terror in Arabic while simultaneously condemning it in English on CNN.

Finally, one more piece of breaking news.  A poll published in the past week by the Palestinian Center for Public Opinion, indicated that for the first time since the beginning of the violence, a majority of 52% of the Palestinian public favors ending the campaign of terror.  

These are small signs of hope.  Small indications that maybe the worst is behind us, and that the potential political neutralization of Yasir Arafat may bring distinct progress to our troubled neighborhood.  

Yet, as I said before, there was a second date that changed the course of history... a second date with which we need to come to terms before moving forward.  September 11^th 2001 marked the defining moment of our generation... the true launching pad of the third millennium.  In the smoking shadow of death and destruction in New York called Ground Zero, an understanding arose of the potential catastrophe awaiting us all should fanatics come into possession of weapons of mass destruction.  Understand well:  these fanatics take different forms and profess different ideologies.  Sometimes they wrap themselves in a distorted and false view of Islam.  Sometimes they employ the language of radical nationalism.  In either case, the threat they pose is the same.  Their willingness to inflict atrocities upon the innocent is identical.  They share a fascination with death.  They praise the ones who choose death.  They indoctrinate their children in a cult of death.  These are the enemies of life itself.      These are the forces who despise the principles of freedom, democracy, and tolerance.  And if the civilized world does not rise to stop them now... chaos, disorder, and terror will spread without mercy.  This is the nature of threat.    It cannot be ignored.  It cannot be wished away.  Ladies and gentlemen... it cannot be appeased.

Non-conventional weapons in the hands of tyrannical regimes threaten all humanity, and while Saddam Hussein is not the only tyrant in the world to have pursued such arms, he is the only one to have shown a willingness to use them-- having already done so against the Iranians and against the Kurds.  Let us hope and pray he is not able to use them a third time. 

On that note, let me add the following.  The campaign taking place at this very moment in the Persian Gulf is not Israel's war.  We have nothing to do with it.  We wish for nothing more than to be left alone.  At the same time, it's hard to deny that for a war not ours... it has become part of us. How can we pretend otherwise?  When Israelis have had to fit their young children with gas masks, how can we say we're disinterested bystanders?  Israel's stake in this war is undeniable, for we haven't forgotten the 39 Iraqi missiles which Saddam Hussein launched against us the last time.  With that memory, Israelis are bound together with anxiety for what might occur this time. The precautions we have taken for this war have fostered among Israelis a sense of unity and togetherness which I never recall seeing before.  In preparing the sealed rooms in our homes against a possible chemical attack, Israel... in effect... has become one big sealed room.  We are sealed together with anticipation for what might still occur in the days to come. 

The stakes of this moment could not be higher.  Should Saddam Hussein be able to hold his grip on power and his non-conventional arsenal, shock-waves would cause the entire world to tremble.  Brutal dictators everywhere would be emboldened.  The United States and its allies would be even more exposed to attack by extremists.  Indeed, the perpetuation of the Hussein regime is the best potential guarantor of future wars.  It would mean the death of peace.

Alternatively, a victory of the American and British led coalition can have a monumental impact.  A line will have been drawn.  A warning will have been sent to other potential tyrants with designs on blackmailing the world.   A powerful message will be given to other regimes... insisting that a different code of conduct be adopted in the future.  A message of warning to those who fan the flames of conflict.  A notice to the likes of Bashar Assad, who in the last few days gave an interview in which he called the very existence of Israel a threat. 

For these reasons and others, there is some hope that whereas the conclusion of the first Gulf War led to the groundbreaking Madrid peace conference, and the first widespread face-to-face negotiations between Israel and its neighbors... this second Gulf War could similarly energize renewed dialogue between the nations of the Middle East. 

There is a hope that the year 2003 may mark a turning-point in the history of our region... a decisive juncture when the future of the Middle East may be reshaped for the better.  Don't expect final peace accords to be signed overnight.  On the other hand, if our guarded optimism over the nomination of Abu Mazen is well-founded, and if the operation in the Persian Gulf can strengthen moderates throughout the region, a different equation in the Middle East just might just be created.

The current equation, based on a division between Israelis and Arabs, need not continue indefinitely.  New and more pressing distinctions will divide between fundamentalists and moderates... between confident, transparent societies and sheltered, backward ones.  In tomorrow's Middle East, I believe the most important dichotomies will distinguish between those who are computer literate and those who are not. Between those forward-minded societies who take part in economic globalization, and those reactionary regimes who once again turn inward among themselves.

I admit... this vision may be somewhat premature, but not at all naïve, especially given the revolutionary social trends that the Middle East will witness in the years ahead.  Take for example, the issue of population growth.  There are now more than 310 million inhabitants in the Middle East... a 30% increase from the past decade alone. 

Estimates indicate an additional 50% rise taking place in the next two decades-- bringing the total population to some 460 million by the year 2020. These rapidly-expanding populations will demand their governments to satisfy basic living requirements for schools, fresh drinking water, and employment opportunities.

An even more important demographic trend is the growth rate of the region's young people between 15 and 35 years of age. Whereas in Western Europe and North America, this demographic group's representation in society has stabilized, and in some cases even declined, the young represent a vastly disproportionate percentage in the Middle East. There are some estimates that in another 20 years, a full 50% of the region's  people will be under 15 years old.

There will be over 200 million Middle Eastern children; a figure greater than the projected combined total in the world's 5 largest economic powers: the United States, Japan, Germany, France, and Great Britain.
These masses of young people in the Middle East can be molded by the global economy and culture in ways their grandparents could not have imagined. The teenager in Kuwait with an internet connection in his bedroom is now open to completely new modes of thinking. The power of this reality was personally driven home to me.  

My son, a thirteen year-old Israeli boy, was "chatting" on his computer with an Arab boy from Qatar. They were talking about the N.B.A., about how much they liked basketball and the L.A. Lakers.  This is the future.  Governments in the Middle East, even autocratic ones, will not be able to control these people-to-people contacts.  Middle Eastern youth will learn about French fashions, Italian soccer stars, and American musicians.  Like it or not, cell-phones, the internet, and satellite dishes will be the most effective agents of democratization the region has ever seen.

A proliferation of  such technologies into the Middle East also has the capacity to spur desperately-needed economic development, and Israel's long-term goal should include its eventual integration into the region's economic structure.  The idea that Israel could join its Arab neighbors in a Middle Eastern style European Union is probably unrealistic.  However, instead of the E.U. model, I would argue that we may, in the years to come, be able to follow the example of the Association of South-East Asian Nations, or A.S.E.A.N.  Unlike the European Union, A.S.E.A.N. is based on absolute territorial integrity, with its member-states ceding no sovereignty to the umbrella organization. A.S.E.A.N. is comprised of very diverse nations that do not share a great deal of common history, culture, or political traditions. Members include the Muslim countries of Malaysia and Indonesia, the Catholic Philippines, Buddhist Thailand, and multi-ethnic Singapore. What do these countries have in common, then? There is simply a recognition that by opening their markets to each other's populations, there will be profits to be made.  When I envision the Middle East of the next twenty, thirty years-- it is the A.S.E.A.N. example I consider more realistic. It serves as a pragmatic model which can serve the interests of Israel and the entire region.

Another key element in the future of the Middle East, beyond Israeli-Palestinian peacemaking, will be infrastructure development.  Transportation within the region is difficult at best, impossible at worst. This fact, combined with imposing bureaucracies and regulations, have resulted in an unlikely situation. The countries of the region only carry out 7% of their total trade with each other... 93% with the rest of world.

Given this reality, basic infrastructure necessities-- rail lines, canals, pipelines, and desalinization centers-- must be given first priority. Otherwise, any Middle Eastern economic zone that develops will not be able to compete on world markets, and will simply implode under the weight of its own inefficiencies.  High-speed rail connecting Egypt, Israel, the Palestinian territories, Jordan... and eventually Syria, Lebanon, and Turkey... would be an important step in the right direction.

 Speaking of infrastructure, I am reminded of the psychological impact that the of opening of land, air, and sea transportation routes between Israel and the Arab world would produce.  Those of you who have visited Israel have probably internalized that upon landing at Ben-Gurion airport, you truly are arriving at your final destination.  Our airport seems to be to only one in the world without connecting flights to other neighboring cities.  The symbolism of this reality is profound-- reinforcing the notion that Israel is isolated, that our country is not an integral part of the neighborhood in which we live.  But ladies and gentlemen, on the day when Ben-Gurion airport becomes a vital hub connecting Jerusalem to Damascus, Beirut, and beyond-- we will know that a real peace is on its way.  On the day when Palestinian children are taught to sing for peace, and not jihad, we will know that a lasting peace may be at hand. 

My friends, with a little good fortune... with the continued leadership and vision of the United States... and with the hopefully imminent marginalization of polarizing figures in the region... this vision could be realized sooner than we believe.  Indeed, there is perhaps... at this very moment... during these very days... the barest light flickering at the end of the tunnel.  It is the first light we have seen since two September days darkened our lives and our dreams.  This is the light of a renewed hope, and we will reach out... first and foremost... to our Palestinian neighbors to come with us towards that light. 

Come with us and let us live together as good neighbors, and not die together as dreaded enemies.   Forsake the cult of death, which has been imposed upon you.  Appeal to our hearts, and you will find us yearning to make a generous peace with you. 

Let us together internalize the words of a remarkable Arab leader, the late Egyptian President, Anwar Sadat, who said in Jerusalem:  "I come to you today on solid ground to shape a new life and to establish peace".  And let us together learn from the words of an influential Zionist leader, Menahem Usishkin, who once remarked:  ``Never say that we will be redeemed tomorrow, for in doing so, we may miss the moment right now.'' 

Thank you very much.