For Immediate Release
Office of the Press Secretary
January 9, 2008

Press Briefing by National Security Advisor Steve Hadley
Dan Panorama Hotel
Jerusalem

Press Briefings

8:17 P.M. (Local)

MS. PERINO: Good evening. I am going to be extremely brief and introduce the National Security Advisor, who can provide you a little bit of a readout on today's meetings and talk a little bit about tomorrow, if you're interested, and answer a few of your questions. He doesn't have a ton of time, but enough hopefully to get you what you need. And I'll be around if you need anything else.

MR. HADLEY: The President started out his set of meetings with a meeting with President Peres. You all, I'm sure, saw the public comments each of them made about that meeting. President Peres talked a lot about the importance of an economic initiative, and economic progress in the West Bank to complement the political negotiations and the building of security institutions by the Palestinian Authority and cooperation between those institutions and Israel.

He had a number of very creative ideas for how to get economic activity going in the West Bank, which of course means jobs, and also means a vision of a better economic future for the people in the West Bank, which complements the aspirations for a Palestinian state and the better political future that would provide.

The President talked to him about those ideas. They involve private parties and the private sector. They'd also involve the opportunity for broader participation by states in the region. The President was very receptive to the ideas. Both he and President Peres talked about the need for a vision of a Palestinian state to motivate the Palestinians to make some of the hard decisions they need to make, in terms of negotiations, but also in terms of building institutions, political institutions, and building security institutions and going after terrorists and others. And they agreed that a vision for a Palestinian state will make it easier for Palestinians to make some of these hard choices. I think it was a very hopeful and positive discussion that the two men had.

The President then went to see Prime Minister Olmert. They had a private meeting for over an hour. I do not at this point have a detailed readout from that meeting for you. They then went into a larger meeting that went well over an hour, with key members of Prime Minister Olmert's cabinet. And it was a very interesting give-and-take, back and forth across the table. Prime Minister Olmert described the meeting he had with President Abbas yesterday, and the commitment they made to get the negotiations moving, deal with the core issues, get their negotiators together immediately, and get started on this process.

And that was good news to the President. One of the purposes of his visit here was to do just that. As I mentioned to some of you here this morning, there have been a lot of important issues that the parties need to deal with -- concerns on the Palestinian side about settlements, concerns on the Israeli side about rocket attacks out of Gaza. And while these issues need to be addressed, and there are forms to address, the President wanted to make clear that -- not to lose sight of and not to lose this opportunity to begin negotiations, and that this was a process that really only those two leaders -- President Abbas and Prime Minister Olmert -- could lead, and it needed their personal involvement and commitment, and time was a'wasting and we needed to get started.

I think it is encouraging that the day before the President arrived President Abbas and Prime Minister Olmert made the statements that they had made, and Prime Minister Olmert indicated I think in his press conference that the anticipation of the President's visit was helpful in the two leaders -- President Abbas and President [sic] Olmert getting started in that process.

The President then had a good exchange with the Prime Minister and Foreign Minister and Deputy Prime Minister Livni. And the President had a lot of questions about what Israeli concerns were going into these negotiations, what their thinking was on substantive issues, not from the standpoint of trying to negotiate or find solutions, but to get a better understanding of the concerns and objectives that animated the Israeli position; and then a lot of questions about how are we going to get this done, what was the negotiating strategy, how was she going to approach the mandate she has from the Prime Minister to lead these negotiations, what was her thinking? And it was a very good and illuminating conversation, I think, for both.

And then the Defense Minister, Mr. Barak, had an opportunity to talk a little bit about security concerns that the Israelis had, and what their approach was going to be on some of the security issues that will clearly be a part of the negotiations. A lot of back and forth on that, again from the standpoint of trying to understand Israeli thinking about their concerns and ideas they had for resolving those concerns in the context of the negotiations.

One of the things that came up in that conversation, of course, was a little bit of issue of settlements. You heard from Prime Minister Olmert on that issue of settlements tonight in answers to the questions at their press availability. Obviously, as the President indicated, there is an obligation under the road map for Israel to stop settlement expansion. Prime Minister Olmert indicated the approach that Israel is taking at this point on that issue. Our view, of course, continues to be that both parties need to carry out their road map obligations -- that involves stopping settlement expansion. As the President made clear, it also means dismantling illegal outposts. We expect those obligations -- the Israelis to go forward on meeting those obligations, and the Prime Minister indicated that he would.

I think the other point is, when the negotiations for the establishment of a Palestinian state get to these issues of borders and territories, and those issues become clear, and it's clear what this Palestinian state is going to look like, then the issue of settlement becomes in some sense moot, and a lot easier to manage.

The President's attitude throughout the meetings he had with Prime Minister Olmert and his team were probing -- probing their thinking, not trying to negotiate; doing an assessment of their commitment to this process. I think the impression he came away with was that it's a serious process, and the Israelis are serious about it; there is a lot of will on the Israeli side; there is clearly a commitment that the two-state solution is the way and the only real way to provide security to Israel over the long term.

The President emphasized in that conversation, as he had with President Peres, the importance of getting a vision of a Palestinian state to begin to take on a reality as a way for empowering President Abbas and Prime Minister Fayyad in enabling them to provide leadership to their people, and to make -- to have the political base for making the hard decisions that they will need to make.

So it was the beginning of a conversation -- a successful conversation, in our view, and I think the President was encouraged by what he heard.

Terry.

Q Steve, the Prime Minister said that Gaza must be part of the package. And I wonder how you see President Abbas getting control of what happens in Gaza, since he doesn't control Gaza.

MR. HADLEY: The President really talked about it. And again, it's why the President keeps talking about the importance of getting this vision of a Palestinian state, getting some definition to that vision, because his view is, first, definition to that vision and some progress in moving toward it. That is to say, implementation of the road map, some of the things President Peres was talking about -- getting economic activity going in the West Bank, people going to work, getting jobs, and the like. Because, as the President says, there will be that moment of clarity then for the people of Palestine, and a moment to choose: Do they want to be part of an emerging Palestinian state of West Bank and Gaza, or do they want to continue to remain where they are now, which is under the rule of Hamas, which is a rule under which the Palestinian people and Gaza are doing very poorly, as you know the humanitarian situation there.

So the President's belief is that President Abbas will be able, once there is a definition of a Palestinian state and some seeing of progress toward -- in moving towards that state, to go to the people of Gaza and say, you have a choice. And the President's confidence is, as has been true for decades now, when people are given a real choice between a free, democratic, prosperous state, and the kind of state under which -- conditions under which the Palestinians are living in Gaza, they will make the choice for freedom, they will every time. And that will provide the basis then for Gaza and the West Bank moving forward towards the establishment of a Palestinian state.

Michael.

Q The President has given a lot of interviews over the last several weeks in which he's talked about what you're alluding to, the definition of a Palestinian state. Why is he not -- why does he not believe it's possible to actually have a real Palestinian state before he leaves office? That was the vision that he had announced in 2002, and I'm just trying to understand really kind of what is the "it" that he's trying to accomplish.

MR. HADLEY: Sure. What he said is -- and what the parties have said -- the parties have set for themselves the goal of negotiating the terms of a Palestinian state by the end of 2008, while this President is in office. That is what -- the goal the parties have said. The parties have also agreed that the actual standing-up of that state, the bringing it into existence, will be subject to the -- meeting the conditions of the road map, which as you know, involves security on the Palestinian side, involves issues of settlements and outposts and other things on the Israeli side.

We are trying, and the parties have undertaken to both proceed with the negotiations and proceed with implementation of the road map. But the question is going to be -- and finally, of course, the third element of that is building the institutions of a Palestinian state. Building those institutions, something Tony Blair is involved in, is going to take some time. Implementing the road map is going to take some time. We want to, obviously, and the parties want to move forward on those things as fast as they can, as circumstances will allow. But the -- I think there is some expectation that those two processes, implementation of the road map, standing up the institutions of a Palestinian state, may take longer than the time required to negotiate the outlines and the details of a Palestinian state. That's the point.

And the deadline -- or I guess it's less a deadline -- I would probably say, the target the parties have set for themselves is let's negotiate the outlines, the details of a Palestinian state; let's get that done by the end of '08, during this period. We will move forward on the implementation of the road map, we will move forward on building the institutions, but that is going to be dictated by a lot of hard realities on the ground. And that is why -- the uncertainty as to when that will be completed, and therefore, a Palestinian state can actually be stood up is the reason why the President says, well, the deadline -- or the target, is a better word -- the target the parties have set for themselves is on the negotiating piece, and to get that done by the end of 2008.

Q Just to follow up, is the President basically, then, in terms of his expectations, is he expecting that some of the core issues that you -- you know, Jerusalem, borders, right of return -- they would not be deferred, that they would be settled -- in his mind, they would be settled as part of this definition that he was talking about?

MR. HADLEY: Yes, and the parties, yesterday, said that, as much, that they have said all issues will be on the table, that the negotiations will be addressing all of the core issues. They listed those issues. So this is the objective that the parties have set for themselves, the target, if you will, the objective of negotiating those issues before the end of 2008.

Sir.

Q It sounds like you're sort of viewing the road map process, though, as something that is going to be viewed with a great deal of -- you're giving the parties a lot of leeway in determining, by necessity, what they can and what they can't do. For instance, the Palestinians don't really have a lot of control, as we discussed, over security in Gaza, so --

MR. HADLEY: Right. There are some realities. It's not that we're giving them leeway; we, of course, are encouraging them to implement their road map obligations as quickly as they can, and we want to go forward very promptly to build these institutions. But as you rightly point out, it's going to take time for the Palestinians to have the kind of institutions and security forces they're going to need to take responsibility for security on the West Bank, much less responsibility for security in Gaza. That's going to take time.

But we are encouraging and facilitating that process. As you know, we've undertaken to monitor the compliance on the road map obligations. We are going to be facilitating and encouraging that process, keep -- Dayton, as you know, been very much involved on security -- helping build Palestinian security institutions and enhancing cooperation between Palestinians and Israelis on security. Tony Blair and the international community are going to be making commitments, with our support, to build the institutions.

It's just a recognition of the reality that building institutions, training security services and getting to the point where Palestinians can provide for security for the Palestinian people in the West Bank and Gaza is going to take time.

Sir.

Q You said earlier the President's feeling was that time was a'wasting and we needed to get started. In any of these meetings, did he deliver anything close to what could be called an admonition that we seem to be about where we were at the time of Annapolis and, as you say, time's a' wasting -- is there any toughness to --

MR. HADLEY: Time's a'wasting is my view -- is my word. I don't want you to think I was quoting him. The President said before he came that one of the things he was going to do was encourage the parties to begin the negotiations, to don't let their efforts to deal with issues of settlements on the one hand, and violence on the other, as important as those are, distract them from moving this negotiating process, and particularly, to emphasize with Prime Minister Olmert and President Abbas that they need to be personally engaged.

So that was the message it was pretty clear he was going to bring. And he was encouraged by the fact that yesterday, President Abbas and Prime Minister Olmert made the statement they made, which you all reported, which indicates that, in some sense, we're already making progress in achieving that objective of his trip.

Sir.

Q On the incident on the Strait of Hormuz, has the administration communicated its warning to Iran through any other means than the media? How confident are you that it was specifically Revolutionary Guard? And given some of the reports that are out there at the moment, are you worried -- on a related issue -- are you worried that named specific and identifiable members of the Quds Force are aiding insurgence in Iraq? Is that something that you'll be able to deal with on an individual member of Quds Force level?

MR. HADLEY: Well, we did some designations today from the Treasury Department, as you've seen. I think the facts of what happened here in this incident on the sea and who's involved are still coming out. I'm going to let those come out in the ordinary course.

And secondly, through a number of ways, we've, I think, made very clear to the Iranians what our concerns are, and I think the President made them very clear here just now.

Q Let me follow up. Are you absolutely 100 percent certain that it is -- was the Revolutionary Guard, when you say the facts are still coming out?

MR. HADLEY: I think that is -- for what I have seen, that seems to be the case. But I'm not in a position here to be definitive on that. I think others, particularly in the Pentagon and the Navy, are better sources for that.

Sir.

Q You mentioned the Treasury Department. Are you referring to sanctions on al Quds and individuals in Iran?

MR. HADLEY: There were some additional designations that came out today. We can give you the background on that.

Steve.

Q If I could follow up on Gaza for a minute. Maybe I don't understand the nuance of what you're saying, but the Prime Minister said there can't be an agreement as long as there are rockets coming from Gaza. President Abbas doesn't have an ability to control those rockets coming into Israel. Isn't that an impasse that will be an obstacle, if you take the Prime Minister at his word -- that simply won't let an agreement go forward, as long as these rockets are coming over?

MR. HADLEY: Well, let's step back a little bit. And I think the Palestinians have made clear, and the President has made clear, we are not talking about a three-state solution; we are talking about a two-state solution. So the Palestinian state will include the West Bank and Gaza. That is what President Abbas has said is the case. And that means, of course, Palestinian institutions that are going to be able to take responsibility for governing, for economic well-being and security in those areas.

Obviously, that is going to probably come much more quickly on the West Bank, but it is part of the objectives that President Abbas has for Gaza, as well. And that's obviously something very important for Israel, given the fact that rockets are coming out of Gaza into Israel.

So it is one of the things that we are going to be working towards. It is not simply building security forces to provide security in the West Bank; it also has to be an opportunity for the Palestinian Authority to have security responsibility for, and the capabilities to provide security in Gaza. And that is going to really -- going to require not only institution-building, but it's also going to require that moment which the President has talked about where the people of Gaza are going to have to decide whether they want to be part of this Palestinian state. And if so, then the Palestinian administration is going to have to be allowed in to take responsibility for governing and security.

Q The President said he -- when asked about the rockets, he said he was going to discuss that tomorrow.

MR. HADLEY: Discuss what?

Q Discuss the rocket attacks with President Abbas.

MR. HADLEY: Right.

Q What exactly does he expect to be able to discuss with him if, as everyone seems to believe, Mr. Abbas has no control over these rockets being fired, in the immediate term?

MR. HADLEY: He doesn't, but there's obviously communication he has with people of Gaza, and messages that he can send to the people who are doing those rockets. And part of it is also making sure that in his thinking about how Gaza and the West Bank are going to be part of this Palestinian state, he also needs to be thinking about his strategy for bringing this choice to the people of Gaza, and then having the institutions ready to go into Gaza that will be able to provide security to them. Until that day, obviously his control is limited. But it will be, obviously, in his interest, in President Abbas's interest, to use whatever instruments of influence he has to try and bring a stop to those attacks.

Sir.

Q Two things, real quick, Steve. You've talked, you've made it very clear that once this state is properly defined and recognizably such for the people of the Palestinian Authority to choose -- you keep talking about this moment of choice and this moment of clarity --

MR. HADLEY: Right.

Q -- not only for the Palestinian people, but for Hamas. How do you envision this choice being presented to them? Are we talking about a referendum?

MR. HADLEY: There have been a lot of discussions about that over the last year and a half. In some sense, the choice is already available to Hamas. The international community has said to Hamas, you need to -- can be a part of this process, but Hamas needed to make a -- to accept some basic undertakings, which is, turn its back on terror, accept the existence of the state of Israel, and accept the various agreements that have been negotiated between Israeli authorities and Palestinian authorities. And Hamas has been unwilling to do so.

So in some sense, the choice has been with Hamas for some time. It remains. Nobody, unfortunately, is very optimistic that they will make that choice. Hamas came to power in election; it will have to submit itself at some point to the people of Gaza in terms of their approval of the job they have done. And at this point, it's a pretty depressing situation in Hamas -- in Gaza for all those people who live there. And what President Abbas wants to do is to build an alternative vision that will begin on the West Bank, but will be available and would embrace both West Bank and Gaza.

Q The other question I wanted to ask is, President Bush's letter to Prime Minister Sharon in 2004 declared that when a Palestinian state is ultimately established, Palestinian refugees should be resettled there, rather than in Israel, and that the borders of this new state should reflect the, "realities of existing major Israeli population centers in the West Bank." Now since both of those positions prejudice final status negotiations in favor of the Israelis, why should the Arab governments, whose assistance you're seeking to enlist on this trip, regard that the administration is in fact a neutral broker in these negotiations?

MR. HADLEY: That letter was issued now almost four years ago, and if you look at the letter, it makes very clear that but those are all issues to be negotiated on final status -- issues about refugees, issues about borders. So these are issues that will be in the final status negotiations that the parties have agreed to undertake now.

Q How can you assume the mantle of neutral broker if you've already declared the U.S. policy on those things and in accords with Israel's policy?

MR. HADLEY: Those were things that were said. They are in some sense, as the President said at the time, recognition of some realities on the ground. He also said in that letter that these realities have been recognized in part of the discussions that have gone on for what a settlement would look like now for almost two decades, if you go back to some of the things that were done at Taba and Camp David.

Similarly, obviously the establishment of a Palestinian state is going to have an issue -- an impact on the issue of refugees. But what we are doing now, the President has made very clear, it's one of the reasons why we've taken the position we have on settlements -- we do not want to prejudice final status negotiations. We've been trying for some time to get to the point where the parties would undertake final status negotiations. That is now occurring. And these issues are now before the parties. And as the President said, he is not going to impose outcomes or positions on them. He has made very clear that the parties are going to have to negotiate the terms of the final settlement.

Q So what bearing does the letter actually have then, is what I'm asking?

MR. HADLEY: It had an impact in April of 2004, at the time it was issued, when -- as a way of giving support to Prime Minister Sharon when he did a very bold thing, which was to decide to disengage from Gaza. And it was an effort to show where some bold step like that might at some point lead. But it was really issued at the time of the Gaza disengagement, and it was something that I think helped at the time to support Prime Minister Sharon and that very bold move.

Q The President talked on the one hand about a certain degree of pressure that he might be able to bring to bear, on the other hand of not wanting to interfere with the outlines of a state. Could you clarify that for us? From what I understand, it sounds like he's willing to pressure when it comes to fulfilling existing obligations under the road map. And as far as that goes, was he disappointed that no outposts were dismantled before this visit? Is he willing to apply pressure on Israel to dismantle outposts? And finally, does he expect Prime Minister Olmert to put the definition of Israel's obligations under the road map as not including Jerusalem and population centers?

MR. HADLEY: Well, I think the President was very clear on the issue of illegal outposts. And he said they need to go, I think was his words. I give you his words. The position on settlements, as I say, is pretty clear for the United States. The road map says that there needs to be an end to settlement growth. That is our position. There should be an end to settlement growth. It also makes clear that one of the reasons for that is, we do not want to prejudice these final status negotiations that are now underway. The Israeli government, the Prime Minister articulated the position of the government of Israel.

One of the reasons we want to get to the negotiations and get the outlines and description of a Palestinian state established is that all these issues, particularly issues of settlement, settlements gets much clearer once that has occurred.

And to go back, I'm not -- the President obviously still stands by that letter of April of 2004, but you need to look at it, obviously, in the context of which it was issued. And secondly, we have a new setting now, which is that we are underway on final status negotiations. The parties have stepped forward on final status negotiations, and that letter makes clear that in the end of the day, the issues that are addressed in that letter need to be negotiated by the parties.

Q Given the difficulty that President Abbas has in exerting any kind of authority over Gaza, and given the daily rocket attacks on Israel from Gaza, looking back, do you see the disengagement, the Israeli disengagement from Gaza as a blunder that's making reaching a peace agreement now more difficult?

MR. HADLEY: I think what was interesting about the disengagement at the time was that it was, I think, part of a process whereby you had a Prime Minister who was regarded by many the father of the settlement movement agreeing to dismantle settlements, and a very painful decision to move Israelis who had been in Gaza for decades out of Gaza. And I think what it -- it was part of an evolution among Israeli opinion that came to the conclusion that the two-state solution is really the right approach for the long-term security of Israel as a Jewish state.

It's obviously an unfinished business. It is not, at this point, what the Israelis would want because of the ongoing security threat to Israel, and for the people living in Gaza it's clearly not what they would want for themselves and for their children. And that's why we think it is important for the parties to move forward with this final status negotiations, to develop the outlines of a Palestinian state, which is an opportunity then to fix that problem both for Palestinians and Israelis.

Q But can you explain on that point how this vision, which you say is going to motivate the Palestinians to make hard choices about a state, is going to be different from the vision of a Palestinian state that was offered in the Oslo Accords and in the detailed final status negotiations that went on at Camp David and Taba? You've been talking about this as though there's almost never been a discussion before of what a Palestinian state would look like, and if Palestinians only had the hope of having a state of their own with certain recognizable contours, then people would choose that. But haven't we seen evidence that that's -- it's a little more complicated?

MR. HADLEY: No, I think the way Palestinians and Israelis are talking about the two-state solution now is qualitatively different than it was 15 years ago, and their commitment to try to achieve it is different. Secondly, the leadership on the Palestinian side is very different. You now have a leadership that says openly they oppose terror, that terror cannot be the route to the establishment of a Palestinian state, that is willing to negotiate directly with Israel on the terms of a Palestinian state; and you have an Israeli leadership that is now very clearly committed to a Palestinian state, the two-state solution as the best approach for dealing with the security challenges of Israel, and ensuring that Israel remains as a Jewish state.

I think that is very different. And the third thing that is also different is that the states in the region seem to be also committed to this process and are willing to begin to come forward to support both Palestinians and Israelis in these negotiations -- support them diplomatically and to support the Palestinian administration as they build the institutions of a Palestinian state. So I think it is a very different situation.

Last question.

Q To go back to Gaza, just for a second --

MR. HADLEY: Did you ask a question earlier?

Q I had one already, yes.

MR. HADLEY: Ma'am.

Q I just wanted you to clarify, when the President said that you cannot dictate what a Palestinian state should look like, what does he mean? I mean, there's an international understanding that it is U.N. resolutions 242 and (inaudible) as a base for the state. Is this different from the American understanding?

MR. HADLEY: No, those continue to be the framework for a solution, but there's obviously a lot of details that need to be worked out that the parties are beginning to discuss. And what the President has said is, those details really are the responsibilities for the parties themselves. The President said tonight the reason for that is that's the only way that you can ensure that it is an agreement that will actually stick. Agreements that get imposed many times are not accepted by the parties with the same alacrity as the agreements that they negotiate themselves, and that's the point the President made.

Q -- talking about a Palestinian border?

MR. HADLEY: Pardon me? There are issues of borders. There's issues of territories. It is the core issues that President Abbas and Prime Minister Olmert talked about yesterday.

Thank you.

MS. PERINO: Okay, we'll have a -- I think we'll have Steve back tomorrow after we return from Bethlehem. So any other topic? Good. Good night.

END 8:51 P.M. (Local)