Behind The Breakdown

If deeds can be measured by decibel level, this was Yasir Arafat's greatest moment. As the Palestinian leader arrived home from Camp David last week, a sweaty crowd of about 4,000 cheered him in the sun-blasted square of Gaza City. "Our state--Jerusalem the capital," they chanted. Many hailed Arafat as a latter-day Saladin, the 12th-century Muslim conqueror of the holy city. Everyone knew the reason: Arafat, who never once shed his military fatigues in the relaxed ambience of Camp David, had stood firm on his demand that he be given full sovereignty over East Jerusalem. The diminutive leader smiled and waved, and the crowd surged forward so that his bodyguards had to lift him on their shoulders, like a rock star in a mosh pit, and carry him from his open jeep.

Contrast that to the quiet arrival of Arafat's counterpart, Ehud Barak, the same day. The Israeli prime minister stepped off his plane from Washington wearing a bulletproof vest. He was greeted, too--with sympathetic hugs from his inner circle and a barrage of jeers from right-wingers along the route home. Two of his top ministers, David Levy and Haim Ramon, openly criticized him for even discussing the Jerusalem issue during the 15-day talks with Arafat. Barak, the would-be peacemaker who had staked his reputation on coming home with a deal, smiled gamely at his gaggle of greeters, but his words were bleak: "I have to say in anguish that we have not succeeded."

But who really failed at Camp David? Take another look. By the end of last week it appeared that a peace accord may be back on the table after all. First, despite a no-confidence vote scheduled for Monday (he was expected to squeak by), Barak may not be the political nowhere man some critics thought he would be. Washington has showered him with kudos, his political opposition remains fractured and many Israelis were moved by his gutsy bid for peace. Arafat's moment in the sun, meanwhile, is likely to prove fleeting, even illusory. Indeed, within minutes of his Gaza City welcome, it became clear that the celebration was mainly orchestrated by Arafat's cronies. The dusty streets emptied as children and youth groups were put back onto buses. Others wandered off. "You see," said one lingerer, Omar Ali, "it was just a show. Arafat has support--for now. But he has to deliver the goods."

That means statehood, and international legitimacy and Western aid for his territory's moribund economy--none of which are practicable without a peace deal. "At some point Arafat is going to be judged on what he can deliver, not what he can reject," says Richard Haass of the Brookings Institution. Arafat is also worried by how thin his support has become back in Washington. In the days after the talks broke up, President Clinton went out of his way to praise Barak for his "understanding of the historical moment." He actually called him "more courageous" than Arafat, whose balkiness incensed the president. Then on Friday Clinton upped the pressure by suggesting the United States might break ground on a new embassy in Jerusalem. That was a critical step toward U.S. recognition of Israeli claims to the holy city, whose status ended up being the deal breaker at Camp David.

So stunned were the Palestinians by the implied U.S. criticism that one of Arafat's top negotiators, Saeb Erekat, quickly called a news conference. Erekat, who downplayed chances for an agreement before the summit, now declared there might be one by Sept. 13, the date by which the "Oslo process" begun in 1993 is set to conclude. "I don't think Arafat realized that this was the end of the road--that by his answer on Jerusalem, he actually made the president call off the summit," said Israeli negotiator Gilead Sher. A senior U.S. official confirms that Arafat, who is notorious for taking talks to the last possible moment, was "shaken" when Clinton abruptly ended the summit. "He thought there would be several summits. We kept trying to convince him this was the only one."

Camp David's bittersweet denouement renewed hopes that another may be held before Clinton leaves office. A NEWSWEEK reconstruction of what happened inside the talks suggests the two sides were remarkably close to a deal--one that could be revived--but that, in the end, Arafat couldn't bring himself to sign off on it.

Clinton, by most accounts, performed Herculean feats of mediation in the two weeks of Camp David. Israeli negotiator Shlomo Ben-Ami called the president's mastery of every tiny neighborhood of Jerusalem "simply stunning." At one point Clinton even created a secret channel to negotiate a "final status" agreement including Jerusalem, NEWSWEEK has learned. "It was a secret Camp David within Camp David," one knowledgeable source said. It nearly worked. Two participants, Sher and Erekat, actually began drafting a peace accord. And contrary to perceptions that only Barak moved on Jerusalem, both sides made concessions. Barak crossed the third rail of Israeli politics by accepting Palestinian sovereignty in some Arab neighborhoods--thus permitting what he had said he never would, a division of Jerusalem. The Palestinians, meanwhile, drew up maps that accepted an Israeli demand to incorporate some nearby Jewish settlements into Jerusalem. "They lost their virginity," gibed one U.S. negotiator.

In the end, however, emotions overcame politics, ambition, even rationality. Arafat, fearful that other Arabs would condemn him--perhaps kill him--for any concessions on Jerusalem, was even less flexible than his negotiators. The summit's final moments degenerated into rage and frustration. Late Monday, Clinton invited Erekat and Ben-Ami to his cabin, where the latter told him that Israel could not give up its sovereignty over East Jerusalem's Temple Mount. This was the site of Judaism's holiest place, the Western Wall, a remnant of the outer wall of the Roman-era Second Temple. Erekat snippily asked Ben-Ami how he knew the temple stood on that site. Ben-Ami, in a fit of anger, pulled a reference book on religion from Clinton's shelf. He looked up Temple Mount and pointed out that the entry was almost exclusively about the Jewish Temple. With that petty exchange, the summit ended.

Now U.S. officials fear that, even if there's another, time may be running out. One factor: Clinton's leverage drains away with every passing month he is a lame duck. A senior administration official who was at Camp David puts the odds of a deal at "one in three... because people act irrationally most of the time."

The singular hope on the U.S. and Israeli sides is that Arafat will realize he can't be Saladin--that he has one chance left to realize his lifelong dream of heading a new, internationally recognized nation. Some Arab officials close to Arafat say that now that he's got his heroic headlines, he may have more mettle to deal. "Arafat went to the summit without much support," says Palestinian spokeswoman Hanan Ashrawi. "He stood his ground and came back to a hero's welcome. This may be a strategy to make a compromise later. Then we will have to accept a bitter solution." But one that may yet bring peace. Not getting a deal could well mean an even more bitter outcome: war.