A Dance of Many Veils

By Ed Magnuson

On successive days last week, George Shultz's senior Middle East aides gathered in a small private room that abuts the Secretary's spacious office on the seventh floor of the U.S. State Department. On Tuesday executive assistant Charles Hill, Under Secretary Michael Armacost, Assistant Secretary for Middle East Affairs Richard Murphy and counsellor Max Kampelman clustered around a TV set to watch Yasser Arafat's United Nations speech in Geneva. By the time Shultz walked in near the end of the speech, the glum group had already prepared a single-page memo. "There was no dispute; there were no differences," says a participant. "Arafat's presentation was unacceptable."

The same aides gathered again early the next afternoon, this time to listen to a tape recording of Arafat's press conference, relayed by a U.S. diplomat in Geneva. Once again the group's verdict on Arafat's performance was unanimous, but this time the judgment was reversed. At 4:01 p.m. Shultz telephoned National Security Adviser Colin Powell. "We're agreed that he did it," the Secretary declared. After 13 years of stalemate and more than a month of intense back-channel negotiations, the U.S. would at last talk to the Palestine Liberation Organization.

Who blinked, Shultz or Arafat? In the State Department's view, the stubborn, strong-willed Shultz had played hardball diplomacy with Arafat until he got what he wanted. Even Shultz's unpopular decision to deny Arafat a visa to speak at the U.N. in New York City was portrayed as a deliberate tactic to push the P.L.O. chairman into uttering the magic words that had never before passed his lips: that the P.L.O. renounced terrorism and "recognized Israel's right to exist within secure borders." Insisted Shultz: "I didn't change my mind . . . Now we have acceptance of our conditions."

That tidy explanation smacks of comforting hindsight. The decisive events were far more complex: both Shultz and Arafat finally acted only under tremendous pressure from other nations. "He was sweating blood," said a Swedish diplomat who dealt with Arafat as the delicate backstage minuet was played out. The P.L.O. leader had the recalcitrant radicals in his organization pulling him back from the edge. Pushing him forward were Egypt and Jordan, as well as the Soviet Union, which "landed on Arafat like a ton of bricks," according to a Washington source. Reversing past policy, the Kremlin urged Arafat to seek talks with the U.S. and acknowledge Israel.

What turned Shultz around? "He has a visceral hatred of Arafat," explained a senior U.S. diplomat. "But finally reality gained the upper hand, helped by a weight of pressure that he had probably not experienced before." The Secretary also felt gentle but firm nudges from George Bush to move the U.S. beyond its isolated stance of just saying no to every overture from the Palestinians.

Even so, the final outcome remained uncertain as the two principal players repeatedly thought they had an agreement, only to find that the other had failed to deliver what had been expected. In the end, it was the persistent middleman efforts by Swedish diplomats that helped close the deal.

Long before the tortuous, on-again, off-again negotiations of the final weeks, the changing situation in the Middle East had been pushing the U.S. toward a dialogue with the P.L.O. Shultz had repeatedly carried his American peace plan around the region in his own version of shuttle diplomacy last spring. The centerpiece of the plan was an end to Israeli occupation of Gaza and the West Bank, creation of an undefined "homeland" for Palestinians, and an international conference at which negotiations to achieve these ends would begin. But each effort ran up against Israeli objections to a conference even before any answer could be found to the question of who should speak for the Palestinians.

The U.S. and Israel had hoped that Jordan's King Hussein would fill this role. But last July the King announced that he would no longer assume any legal or administrative responsibility for Arabs living in the occupied West Bank. Shultz conceded that when he had invited moderate Palestinians to meet with him in the past, no one had shown up. Insisted a Palestinian representative at the U.N.: "He finally came to the conclusion that the P.L.O. is the only interlocutor for the Palestinians."

Meanwhile, the yearlong uprising by the occupants of the West Bank and Gaza had drawn worldwide sympathy for those Arafat called "the children of the stones." The best way to exploit that sentiment and further isolate Israel was for the P.L.O. to move toward a more moderate, reasonable role. Arafat was strongly urged to do so by Egypt's President Hosni Mubarak, Jordan's King Hussein and, after the cease-fire in the Iran-Iraq war, Iraqi President Saddam Hussein. For the U.S., which sharply criticized Israel's heavy use of force against the intifadeh, an overly close relationship with Israel became a liability in its relations with nearly every other nation.

The P.L.O. took advantage of the uprising when its national council convened in Algiers on Nov. 12 by unilaterally declaring the existence of an independent Palestinian state. For the first time, a council statement also accepted U.N. Security Council Resolution 242, which calls for withdrawal of all forces from lands occupied after the 1967 Arab-Israeli war and implies a recognition of Israel. It endorsed Resolution 338 as well, urging all relevant parties to negotiate.

Still, the statement was deliberately drawn to be ambiguous enough to prevent a walkout by George Habash and Nayef Hawatmeh, two of the P.L.O.'s more radical leaders. Shultz declared that the P.L.O. wording was not clear enough on Israel's existence and did not flatly rule out all forms of terrorism.

Sweden's Foreign Minister Sten Andersson moved quietly to bridge the Shultz- Arafat breach. He had visited Israel in March, seen the violence there close up, and discussed the situation personally with Shultz on a Washington visit in April. Shultz did not explicitly say he wanted the Swedes to act as intermediaries, "but I can read thoughts," Andersson joked last week.

Swedish diplomats have a tradition of mediating between Arabs and Jews that goes back to Count Folke Bernadotte and U.N. Special Representative Gunnar Jarring. Last September was the 40th anniversary of Bernadotte's assassination in Jerusalem, and many Swedes were enraged when two former members of the ultra-Zionist Stern Gang went on Israeli television and boasted about their part in the killing. The incident may have helped intensify Swedish efforts to get the U.S. and the P.L.O. talking.

Seeking a buffer, Andersson had his aides invite three prominent American Jews to Stockholm. New York attorney Rita Hauser, Los Angeles publisher Stanley Sheinbaum, and Drora Kass of the Center for Peace in the Middle East met with Arafat aides on Nov. 21. Out of this came a covert P.L.O. statement, which the visiting Americans and the Swedes considered a decisive advance beyond what the P.L.O. had said in Algiers. The new language was shown to Shultz by the Swedish diplomats on Nov. 25.

If he was impressed, the Secretary did not show it. His concern about terrorism was so great that on the very next day he seized the issue to reject Arafat's visa request to appear before the U.N. General Assembly. Arafat was "an accessory" to terrorism, Shultz held, and his presence in New York City would pose an unacceptable security problem. The worldwide criticism of the lonely U.S. stand was deafening.

Although unable to say so publicly, Bush and his incoming Secretary of State James Baker were troubled by Shultz's actions. "They were annoyed that his actions were going to make it extremely difficult to get anywhere in the Middle East," said an Administration official. "Their sense was that he was creating a mess that he could walk away from in a few weeks." Both men felt that the visa rejection, while based on principle, gave Arafat the image of an underdog being bullied by the U.S. Bush publicly backed Shultz but quietly urged that he press the Palestinians to meet the U.S. conditions.

As the General Assembly voted overwhelmingly to hear Arafat in Geneva instead of New York, Andersson decided to invite the Americans back to Stockholm. In a critical meeting on Dec. 7, exactly a week before Arafat's speech, five American Jews met with Arafat.

The Swedish government had asked the U.S. for suggestions on the language for Arafat to use that would be acceptable to Shultz. The State Department drafted wording, clearly stating the P.L.O.'s acceptance of Israel and renunciation of terrorism. In addition, Shultz sent word through the Swedes that if Arafat accepted the key phrasing, the U.S. would push for immediate talks.

Although a public summary of the discussions fell short of Washington's stiff requirements, Arafat privately agreed to the State Department's proposed language. It was clear that the P.L.O. leader wanted to save his big move for his Geneva U.N. speech, magnified in importance by the Shultz visa rejection.

After flying back to Tunis to consult with his aides on the weekend before his Geneva address, Arafat finally rejected advice from some Palestinians that he give up on the U.S. until Shultz was gone. That, Arafat decided, would stall the promising P.L.O. peace drive too long and ruin his impending hour on TV screens around the world. He accepted the wording worked out at the secret Stockholm meeting and incorporated some changes from the State Department's proposed language. Arafat informed the Swedes, who told Washington, that he would deliver the critical words at the U.N.

Ronald Reagan, meanwhile, had been getting a fusillade of transatlantic telephone calls urging him to be more sensitive to Arafat's position and readier to accept his concessions. Repeated pleas came from Egypt's Mubarak, Jordan's Hussein, Saudi Arabia's King Fahd. Just as important, such close U.S. friends as Britain's Prime Minister Margaret Thatcher, France's President Francois Mitterrand and West Germany's Chancellor Helmut Kohl joined the persistent chorus.

The common element in this high-level pitch: if Arafat could not get some favorable response from the U.S. for his painful and personally dangerous efforts, he would face a radical Arab backlash, perhaps headed by Syria. A rare chance for progress on peace would be lost. "It was a full-court action to get both sides to see reason, especially Washington," said a Swedish diplomat.

Finally, on the day Reagan and Bush met with Soviet leader Mikhail Gorbachev on New York's Governors Island -- six days before Arafat's speech -- Reagan told Shultz that, if Arafat delivered as promised, the State Department had permission to open "substantive discussions" with the P.L.O. After Arafat's assurances on the following Monday, U.S. Ambassador to Israel Thomas Pickering told Israeli Foreign Minister Shimon Peres of Reagan's decision. Cairo and Stockholm were also informed. All the players were expecting a breakthrough.

But the pressures were still mounting on Arafat. Habash and Hawatmeh were telling him that he was going too far. "They insisted that he stop altering the meaning, as they saw it, of the Algiers declaration," said an Egyptian diplomat. "They were not prepared to go further."

When he took the podium at Geneva's Palais des Nations on Tuesday, the unpredictable P.L.O. chairman again stopped maddeningly short of uttering the precious words. Instead of saying, "I recognize Israel's right to exist," Arafat declared, "The P.L.O. will seek a comprehensive settlement among the parties concerned in the Arab-Israeli conflict, including the state of Palestine, Israel and other neighbors." While he "condemned" terrorism "in all its forms," he did not "renounce" it, and he saluted "those sitting before me in this hall" who had fought in "national liberation movements."

Gloom engulfed the negotiations. The State Department, although seeing "interesting and positive developments" in Arafat's address, judged it insufficient for starting talks. "Close but no cigar," said a State Department deputy. Bush and Baker were equally disappointed. Said a source close to them: "It's like you are at the church ready to get married and the bride shows, but she's not wearing white."

Persistent as ever, Thatcher, Mitterrand, Mubarak and Hussein were back on the White House telephones urging Reagan to reassess the speech. Using a colorful metaphor, Mubarak told Shultz that Arafat had already taken off his shirt and that the U.S. was asking for his trousers.

Sweden's Andersson and Egypt's Foreign Minister Esmat Abdel-Meguid told Shultz they still had a shot at persuading Arafat to take the required extra steps. In Geneva, Abdel-Meguid carried his plea personally to Arafat when the two dined together on Tuesday night. In Geneva, U.S. Ambassador Vernon Walters was asked by Momammad Said, a Palestinian-American adviser to Arafat, what Arafat must do to satisfy the U.S. "Just tell him to say in public what he said in private," replied Walters. Said passed this along. Andersson resumed his delicate persuasion, meeting twice with Arafat. The Arab moderates -- Egypt, Jordan and Iraq -- also pressed him to try once more to clarify his views.

Finally, all the pressure paid off. A jaunty and jovial Arafat strode into a conference room in the Palais des Nations on Wednesday night (afternoon in Washington) to face 800 reporters. He put on his spectacles and read a statement in English. This time he accepted Resolutions 242 and 338 without coupling them with demands for Palestinian independence. He specifically named the state of Israel as having the right "to exist in peace and security." Most significantly, he declared, "We totally and absolutely renounce all forms of terrorism, including individual, group and state terrorism."

"Enough is enough," Arafat told reporters. Then, in an apparent reference to Mubarak's metaphor, he added, "What do you want? Do you want me to striptease?" At last, his dance of many veils was a hit.

With reporting by Dean Fischer/Geneva and Bruce van Voorst/Washington