WASHINGTON (IPS) — The U.S. should proceed cautiously in its engagement strategy with Iran, while moving quickly toward final-status negotiations between Israelis and Palestinians, according to a new report by a team of veteran diplomats and Middle East policymakers.

A woman walks in front of the now-defunct Shepherd Hotel, where a housing project is planned, in the Sheikh Jarrah neighbourhood in East Jerusalem July 19, 2009. Prime Minister Benjamin Netanyahu, saying he would not take orders over Israeli settlement in East Jerusalem, rejected on Sunday a U.S. demand to halt plans to build more homes for Jews in the disputed area. REUTERS/Ammar Awad

The policy paper, released Wednesday by the Israel Policy Forum (IPF), an organization that promotes U.S. diplomatic engagement in the Middle East, expresses support for President Barack Obama’s ambitious Middle East strategy.
Entitled “After Cairo and Iran: Next Steps for U.S. Diplomacy in the Middle East,” it recommends continuing attempts to engage Iran, but shifting primarily to back-channel rather than public talks in response to the recent political turmoil following June’s disputed presidential elections.

The report also advocates accelerating the 2002 “road map” for Israeli-Palestinian peace by convening an international conference that would set the stage for final-status negotiations, sponsoring unofficial “Track Two” talks between Israel and the Arab states, and pursuing an Israeli-Syrian agreement at the same time as an Israeli-Palestinian one.

The IPF policy paper was produced by a task force of 15 veteran Middle East hands, including Samuel Lewis and Edward Walker, both former U.S. ambassadors to Israel, former ambassador to Egypt Robert Pelletreau, and former American Israel Public Affairs Committee (AIPAC) executive director Thomas Dine.

At a time when hawks in the U.S. have attacked the Obama administration’s Middle East strategy, calling on it to take a harder line against Iran and alleviate its diplomatic pressure on Israel, the report offers a notable show of support for the administration’s strategy – along with a number of suggestions for “fine-tuning” it.

In May, the IPF took out a full-page ad in the New York Times demonstrating its support for President Obama’s efforts to reach a two-state solution.

Perhaps the most contentious issue the report considers is how to proceed with Iran, where alleged fraud in the Jun. 12 reelection of President Mahmoud Ahmadinejad and the government’s subsequent crackdown on protesters have thrown the engagement strategy into question.
Proponents of continued engagement have argued that the election crisis does not change the basic U.S. strategic calculus regarding Iran’s nuclear program, and that the Iranian leadership under Ahmadinejad and Supreme Leader Ali Khamenei may be more willing than ever to reach a deal with the U.S. to shore up its domestic support.

Critics have argued that public engagement with the regime risks legitimizing Khamenei and Ahmadinejad at the expense of dissenters.

The IPF report suggests dealing with these problems by continuing engagement with Tehran, but urges that “initial contacts be more private and secret than would have been anticipated originally.” It also raises the possibility of Track Two negotiations, in which “participants acting in their private capacity have the support of their respective governments to talk, but not to negotiate.”

The report praised the administration’s approach, saying that “President Obama has taken just the right combination of caution and firmness.”

However, one partial dissent included as an addendum to the report was more pessimistic, arguing that the Islamic Republic’s leadership has become more intransigent and that the prospects for a diplomatic settlement are dim.

On the Israeli-Palestinian front, the task force argued that the Obama administration’s pressure on Israel to freeze settlement construction in the West Bank was a worthwhile first step, but cautioned against getting “stuck… indefinitely” on the issues of settlements and Palestinian incitement.

Instead, it advocates moving quickly to negotiations, skipping phase two of the “road map” – the creation of a provisional state with temporary borders – and moving directly to phase three, an international conference that would prepare the way for a final-status agreement with permanent borders.

Regarding the current split in Palestinian leadership between Hamas and the Palestinian Authority (PA), the report stopped short of making concrete recommendations, but left the door open to Hamas participation and suggested “exploring new diplomatic possibilities” through secret talks and through the Arab states.

“There wasn’t a lot of consensus in the group about what to do about [Hamas], it’s a huge roadblock,” said Amb. Lewis, while adding that “the last statements made by the Hamas leadership… suggest more and more that Hamas wants to find a way into the political process.”

The Washington Post reported Wednesday that Thomas Pickering, a former U.S. ambassador to Israel and to the U.N., met last month with Hamas officials in Geneva in an unofficial capacity.

However, the U.S. government maintains that it will only deal with Hamas if the group renounces violence, recognizes Israel, and agrees to abide by previous agreements.

The IPF report also suggests building on the 2002 Arab Peace Initiative, in which Israel would received full diplomatic recognition from all Arab League states within the context of a two-state settlement, by pursuing Track Two discussions between Israelis and Arabs.

It particularly urges the parties to deal from an early stage with the status of Jerusalem under a final agreement – which, the report argues, is both the “thorniest issue” and “the key to drawing [the Arab states] into the process.”

As part of the Israeli-Arab peace process, the report urges simultaneous diplomatic engagement with Syria. From the U.S. standpoint, this would involve consulting with Turkey to facilitate the resumption of talks between Israel and Syria under Turkish mediation.

In June, the Obama administration announced plans to return a U.S. ambassador to Damascus following an absence of almost four years, a major step in the road to reconciliation with Syria.

The IPF report is notable as a show of support for an active U.S. diplomatic push in the Middle East at a time when hawkish critics have urged Obama to scale back his ambitions.

The stature of its participants within Middle East policy circles in Washington is likely to bolster the weight of the report’s recommendations.

Also on Wednesday, the Centre for American Progress (CAP) released a report of its own concerning the Israeli-Palestinian peace process.

The CAP report suggests “four concrete steps” that the Obama administration should take in the coming months.

These include preparing for potential Palestinian elections in 2010, creating an integrated institution-building plan for the Palestinian territories, taking steps to address the humanitarian crisis in the Gaza Strip, and conducting an enhanced public diplomacy effort in the Middle East, with a particular focus on Israeli public opinion.