AMB. LEWIS: Well, good evening again. Delighted you could all be with us. We've had a rather active day, it seems to me, at the Institute of Peace, and the first two days of our conference have gone extremely well. We've explored together many dimensions of deterrence and how it affects Israel and Syria and Iraq and other countries in the region and what one can learn from the recent Gulf crisis for theories of deterrence. We have an interesting day tomorrow looking at regional security questions and I hope all of you will be able to stand up to one further day of lengthy discourse.

But tonight we have a special treat. Ambassador Zalman Shoval has been Israel's ambassador to the United States now for something less than a year, though I suspect it seems like about five years. He's an extraordinary representative of his country, and I feel very fortunate that Sally and I have known the Shovals for a number of years, and they were extremely gracious hosts to us many times when we were in Israel, and we were just delighted when they came to Washington.

He's unusual as an ambassador because he's been both a career diplomat - - he entered the Foreign Ministry initially back in 1955 and then subsequently left it to become a banker. And he spent his life really in two or three professions at once, which is a good trick. He's been a businessman and financier and industrialist, and he's been back in the Foreign Ministry as Assistant Director for Information under Moshe Dayan, and he's been in and out of the Knesset several times as a politician. So he's had at least three different professions. He served in the Knesset in the Rafi (sp.) party for a number of years, then left it, and then returned to it again in 1988. And more relevant in a sense than all of his political career, which has been devoted to, I would say, centrist politics under a couple of different banners, and I first knew him as a strong supporter and follower of Moshe Dayan, and I think he's kept that connection with Moshe, for he was one of those who had the idea and helped to bring the idea to reality of founding the Moshe Dayan Center at Tel Aviv University, which our friend here Itamar Rabinovich and Asher Suscher (sp.) now heads. And that center was kind enough to make me a fellow when I left Israel as ambassador, so I spent a year as a visiting fellow there, and I feel a very special personal connection therefore. Moreover, this conference, as you know, is largely populated by scholars from both the Dayan Center and the Jaffe Center. So it's a real Tel Aviv University kind of evening we have for Ambassador Shoval, so he should feel at least quite at home, and we just -- I just discovered something I should have known, is that he's also related to two other people at our table, so it really is a family affair.

AMB. SHOVAL: Three other people.

AMB. LEWIS: Three other people, yes. Well, I wasn't counting your wife. I thought -- two in addition to your wife, I should say.

Moreover, he did his work in political science at the University of California at Berkeley, so he is in a very real sense a product of the American educational system. And that, I suppose, he's had to work hard to overcome -- (scattered laughter).

In any case, since he's been ambassador these various last months, it's been a very quiet time in US-Israeli relations. Not much has been going on. He hasn't been in the news at all, and the few times that he's been on television, he's been remarkably successful. So I'm sure that perhaps he'll get another chance before the month is out.

Seriously, I think Zalman has proved already to be an extraordinarily fine choice to represent Israel and the United States at a very touchy and sensitive and very important moment in the future of peace and in the future of our relationship between our two countries. And I think both our countries are very well served to have him and Kenna (sp.) here. And we're just delighted that he has agreed tonight to speak to us about Israel's security preoccupations for the future.

Ambassador Shoval. (Applause.)

AMB. SHOVAL: Thank you, Sam, Sally and all relatives and non-relatives - - (laughter) --around here. And I'm very grateful for the opportunity to address this important forum here tonight.

I will say very little about the peace process. In fact, I would be less than candid with you if I wouldn't tell you right away that the reason for that is that we are at a rather delicate stage in trying to get the peace process in our area off the ground, and it does not serve a useful purpose to go into too much detail at this time.

Let me state, however, that we in Israel have not lost faith, and we still hope that the Gulf crisis hopefully may have created a new situation which will give peace a new chance. And I say that in spite of the feeling of some that the window of opportunity which was supposedly there is not as wide open as some of us had hoped. The window of opportunity concept was predicated on the thesis that the Gulf war had in some way miraculously changed fundamental Arab hostility to Israel's existence sufficiently to make such a breakthrough feasible.

I am afraid that assessment may have been overly optimistic. Still, Israel is not disheartened, nor should the US be, even though our sights may have to be readjusted somewhat.

Peter Rodman in a recent "Foreign Affairs" article said, I quote: "The fundamental premise of American policy was that defeating Saddam Hussein would discredit radicals, strengthen moderates, and enhance regional stability." End of quotation. He then went on to say there was a new sentiment in the Middle East that new forms of democratic governments were needed. I wonder whether the sentiment which Rodman mentions wasn't more prevalent in Washington than in the Middle East itself. Pity, for wars, to the best of my knowledge, have never broken out between democracies, and as long as Israel remains the only true democracy in the Middle East, "moderation" and "regional stability" will remain relative terms at best.

On a different subject, but related, ideas of new regional security arrangements, so much talked about during the Gulf crisis, also look somewhat more doubtful, or at least more limited now. And it must be said that the very idea of assigning to a country like Syria a responsibility for the security of any other country makes the parable of the cat guarding the milk look almost normal in comparison.

Some Middle East commentators have tried over the years to depict the Palestinian problem or the Israeli-Arab conflict as the main or even the only reason for instability in the Middle East. Though Saddam Hussein's aggression against Kuwait and his threats against Saudi Arabia have provided ample proof to the contrary, this sort of "don't confuse us with the facts" concept is still very much in some people's minds. This, by the way, in spite of the fact that most conflicts in the area over the years have broken out between Arabs and Arabs, Moslems and Moslems, and not necessarily between Arabs and Israelis. Had there been peace between Arab states and Israel, I would imagine that at least some parts, some aspects of Israel's attitudes towards the territories and the Palestinians could also change. Secretary of State Baker, as we know, has often spoken about the need for reconciliation in the Middle East. Actually, reconciliation may be the wrong term, for this would imply that somewhere, sometime in the past the Arab states and Israel had actually lived in peace. Well, this is unfortunately not quite so. There was no peace prior to 1967, before Israel repulsed Arab aggression and occupied the territories from which aggression was launched.

Thus, in our view, the primary fundamental prerequisite for peace between Israel and her neighbors is still for the Arab world to change its basic attitude towards Israel and to the Jewish people. As long as some, perhaps most Moslem Arabs do not accept the Jewish people's right to maintain national sovereignty in its own independent state, there will be no real peace.

You must remember that in the Moslem world there seems to be little tolerance for independent nationhood for non-Arab or non- Moslem peoples. Thus, the Kurds, who are Moslem but not Arab; thus, the Christian Lebanese, who are Arab but not Moslem. Israel, of course, is neither Moslem nor Arab.

In the last two years, there have been far-reaching changes in some of the aspects of Israel's strategic framework. The facts are known to all of you. The end, for the time being anyway, hopefully forever, of the cold war; the withdrawal of the Soviet Union from the major leagues to the minors; the changes in Eastern Europe, and so on and so forth. Other developments, however, such as the march of democracy, which has made considerable progress, not only in Eastern Europe, but also in Latin America and Africa, have not yet reached the Arab-Moslem societies in the Middle East.

As Professor Elie Kedouri recently commented -- I think it's Sir Elie Kedouri now. If I read correctly the newspaper the other day, he was on the Honors List. Anyway, as he has commented, I quote, "In this region, the Middle East, every time you turn the wheel there is a new coalition. Before the recent war, President Mubarak had an alliance with Iraq, Yemen and Jordan. This is typical of regimes headed by rulers who are under no constraints from public opinion or parliaments." End of quotation.

All this, of course, has not only constitutional or cultural implications, but also direct relevance on the questions of war and peace, as we have seen in the recent Iraqi aggression against Kuwait.

President Bush has recently outlined his plan, his ideas for arms control in our area. Let me say that Israel has welcomed the President's initiative, but we must remember that, contrary to the East- West situation, considering the rather bad neighborhood in which we live, Israel is still being seen by an illegitimate creature by some Arab countries, all of which, except for Egypt are still officially at war with us. We believe there must also be first a profound, positive change on the part of the Arab world towards the Jewish state, for in a continuing atmosphere of hostility, any weakening of Israel's capability of deterrence would most probably bring about further wars in the future and not peace.

Indeed, a very central factor in the instability in the Middle East as a whole is the enormous advantage the Arab countries have in conventional arms. This was borne out not just by the Israel-Arab conflicts, but also by the two Gulf wars. Syria has 5,000 tanks and is trying to buy more. Iraq still has 3,000 tanks. Egypt, which is at peace with Israel, has 4,000 tanks and will soon obtain more. Jordan has 1,000. And Saudi Arabia may soon embark on a rearmament spree.

In effect, we may again be facing a very real arms race in the Middle East. The question that arises, therefore, is when the United States proposes to support, and I quote, "the legitimate need of every state to defend itself," how will it be determined and by whom what these needs actually are? After all, the ever-changing alliances and confrontations in the Middle East, which Kedouri amongst others mentions, may lead to the conclusion has such legitimate needs to defend itself against every other state, the bottom line of which would be face in the combined Arab world an immense amassing of conventional arms, plus Scud and other ground- to-ground missiles.

The problem of the unprecedented quantity of these arms in Arab hands eroding Israel's qualitative edge is a major destabilizer in the Middle East and should have priority in any attempt to address arms control in our part of the world. In the immediate future, the Iraqi defeat has considerably lessened the military threat faced by Israel, and one may assume that the dangers from a reconstituted eastern front within the time frame of the next two or three years has receded. However, receding does not mean eliminating, and the new internal political realities in Jordan and in Lebanon, for instance, may even have added some negative elements to the equation of Israel's security.

I have mentioned Syria; Syria does worry us and for more than one reason. Not only is she a hard-liner on most questions relating to Israel and the peace process, and even if she should somewhat moderate her stance in this respect, moderation is a very relative term as applied to Syria. Not only does she still harbor terrorists, but her efforts to obtain additional weapons in general and chemical weapons in particular, which by the way may be much more advanced than Iraq's ever were, is very alarming. Meanwhile, Syria is busily spending the billions of dollars she received for her rather symbolic adherence to Desert Storm on purchasing missiles from North Korea. We are watchful. We are watchful of Syria, and it would be a total mistake on her part to think otherwise.

Ladies and gentlemen, geography, topography, strategic depth -- use any term you like; let's just say territory -- are still and will continue to be a major factor for a country's ability to deter aggression or to defend itself in case such deterrence has failed. Not the only factor, but a major factor. Kuwait was conquered within a few hours, and had Saddam Hussein gone on to invade Saudi Arabia, it is that country's size that would have afforded its American defenders sufficient strategic depth to eventually reverse the situation.

I do not usually like the term consensus, but let us say that there exists a basic common denominator among many, if not most, Israeli military people whatever their political leanings -- right, left or center, hawkish or dovish -- to the effect that (a) Israel within her pre-'67 borders does not possess sufficient strategic depth to be able to defend herself; (b) that certain parts of the Judean and Samarian plateau constitute a vital area for Israel's ability to mount an effective defense with relatively small forces against a major Arab attack; and (c) that should a potential aggressor ever reach the conclusion that a single tactical move could make it possible for him to achieve the strategic aim of cutting Israel in two or even only of occupying parts of Israel's central area, he would have a very strong motive to do just that. This in itself could be a major cause for war and a damper on the prospects for peace. I would imagine, therefore, that in any political formula which will eventually be arrived at, Israel will at least maintain an effective military and civilian presence in Judea and Samaria, the West Bank, this in my view not being inconsistent with the possible future redeployment of Israeli troops into specified security locations, as envisaged, for instance, by the Camp David agreements.

The importance of a territorial barrier for Israel should not lessen, however, her attention to the need of continually improving her intelligence capabilities. Given Israel's militia-like army based on reserves, we need ample warning of any imminent Arab threat. Missiles have indeed changed some aspects of warfare, especially with regard to the home front. But it is precisely that, namely, the possible slowdown of the mobilization of reservists as a result of a missile attack, which makes geography and Israel's ability to keep the aggressor's armor well away from her vital areas in the coastal plain even more important than before.

As you know, it has been agreed between Israel, the United States and I think some of the other parties that Security Council Resolution 242 will be the basis for the permanent status in the territories to be arrived at after five years. But this by now almost sacrosanct resolution, like all sacrosanct rules, means different things to different people. It is our view, a view which is borne out and reinforced by those who formulated the resolution, that it is certainly not synonymous with the principle of "land for peace."

Just to mention one point, the security angle, explicitly mentioned, is certainly a precondition to any possible withdrawals, even partial withdrawals. Thus, Israel could consider withdrawing from all of Sinai, with the hundreds of kilometers of desert stretching between her and Egypt, as a reasonable security risk, while withdrawing from areas which are at a distance of 12 minutes from Tel Aviv or 1-1/2 minutes from Ben Gurion Airport or 1-1/2 seconds from the center of Jerusalem as not being a risk which she can afford to take.

The other day I found a quotation from FDR. Back in 1941, he said, I quote, "Old-fashioned common sense calls for a strategy to prevent an enemy from gaining a foothold from which he can mount a later attack." End of quotation. Well, we too prefer old-fashioned common sense in this respect.

Scuds may create some damage, even a lot of damage. Scuds may create a lot of psychological damage. They cannot determine the outcome of battles or wars. As Israel's former Chief-of-Staff General Dan Shomron recently stated, I quote, "The real existential threat does not come from Scud missiles or from any other missiles, but from massive armor, land and air forces." End of quotation. I mention all this because when the Arabs speak about "land for peace," they forget about all other aspects of 242, nor do they ever speak even about territorial compromise. They speak about a more or less complete withdrawal of Israel to the pre-1967 Green Line. And it isn't only the Arabs who cherish that interpretation. Does this mean that the formula of "land for peace" should be almost tantamount to reducing the issue of peace to some sort of bargaining procedure? No land, no peace, not all the land, not all the peace.

Israel wants peace. Israel offers peace. Israel has said time and time again, "We shall negotiate peace without any preconditions." We have yet to hear the same from all the Arab parties. Once negotiations do take place with good sense all around, there will be room for more than one formula of compromise. But "land for peace" in this distorted fashion is in our view a non- starter. Actually for this very reason, namely, the centrality of the security aspect in our attitude towards Judea and Samaria -- the West Bank -- I could imagine that Israel might feel a lot easier about accommodating some of the aspirations of the Arabs in the territories once the Arab states surrounding her will follow Egypt's example in making peace. And that, after all, is the main logic of the "two-track approach."

Deterrence, of course, has more aspects than just geography and military power. To mention one, country's relationship with other states is certainly an important factor, and as far as Israel is concerned, her relations with the United States and the perception of strong American support for Israel has for many years been an important component in Israel's deterrent capability. Thus, any erosion in this support or even in the perception of it would increase the dangers of Arab aggression on the one hand, and reduce the willingness on the part of Israelis to risk political compromises on the other hand.

On the other hand, the substantial increase in Israel's Jewish population as a result of immigration, half a million perhaps by the end of 1993, a million perhaps by the end of 1995, provided of course the absorption of the immigrants will be more or less successful, will in my view has a positive impact on the prospects of war and peace, both as a deterrent to the Arabs, but no less important, as a confidence builder to the Israelis.

There is some talk, especially on Capitol Hill, about the need or advisability for a US-Israel defense treaty to include, among other things, an American guarantee for Israel's security. The idea is not entirely new, but it seems to have found new supporters in the wake of the recent Gulf crisis and Saddam Hussein's threats against Israel. But there are some questions which must arise in connection with this idea. True, the very fact of an American guarantee and of the awareness on the part of potential Arab aggressors that America does intend to make good on this guarantee could serve as a deterrent. Moreover, if within the framework of such a treaty, America's commitment to Israel's qualitative edge vis-^-vis any combination of Arab countries would be institutionalized and enhanced. This indeed would be a positive element reducing the dangers of additional wars in the Middle East.

Should, however, such a treaty in any way impose limitations on Israel's freedom of conduct in matters pertaining to her vital security, pertaining to her defense, not excluding even preemptive or retaliatory actions if deemed necessary, the negative aspects of such a treaty might outweigh its positive ones. There already have been some voices suggesting that Israel's policy of restraint in the recent war may have sent the wrong signals to her Arab neighbors or even perhaps to some Israelis themselves, namely, that Israel's will or ability to defend herself have diminished, and though this is a minority view, which I for one do not share, it must be very clear that Israel has not and will not change her basic policy of not relying on other country's soldiers to fight for her, the Patriot batteries notwithstanding. And by the way, this was not the first time in history that Israel has asked other countries for temporary defense against aerial attacks.

A recent report by the London-based Institute of International Strategic Studies asserts that in five years' time or so, the US will not be able to field the same size of force as it did in the Gulf. Anyway, considering the months it took to assemble that force, Israel would have ceased to exist long before the American cavalry would have come to her rescue, and contrary to the case of Kuwait, Israel and Israelis would never have had the chance to come back another day.

Ladies and gentlemen, the topic we are discussing tonight cannot of course be separated from the overall question of Israel- American relations. Let me say, therefore, that I believe that in spite of some views to the contrary, the bonds between our two countries as a result of the Gulf crisis will eventually prove to have been strengthened, not the other way around. This will also be true of the strategic nature of our alliance, for whatever the importance of temporary coalitions with this or that Middle Eastern state, one thing is absolutely clear.

Real, long-lasting relationships can only exist between democratic countries, only where the public will support them and where democracy ensures stability and continuity. They are not viable in countries that are ruled by dictators or by narrow-based political or military cliques or families which not only can change their policies at the flip of a coin, but can themselves be overturned by this or that sudden event.

Now, conventional wisdom holds that the Soviet Union no longer being an active anti-Western player in the Middle East, the American-Israeli strategic alliance has become irrelevant. This is in my opinion taking a rather short-sighted view. True, the character of the potential adversary may have changed, and the threat to the region may no longer come from the Soviet Union, but for instance, a combination of Moslem fundamentalism and tyrannical, military-oriented nationalism in parts of the Arab world, both being pathologically anti-West, could be as potentially troubling as the former Soviet threat, even if we do not have conclusive proof yet that Iraq's nuclear arms potential is still intact. The main emphasis in America's post cold war strategy, according to what we hear and what we read, will be conventional forces based in the United States, forces which can be moved to crisis points in different parts of the world. The practicability and success of such strategy will, however, be predicated on America's ability to pre- position supplies and equipment and to increase the support infrastructure in potential theaters of combat.

Some United States senior officers are on record that Desert Storm demonstrated that the United States was dangerously short of cargo ships and planes to get troops and weapons from the United States to distant trouble spots in a hurry. Well, no trouble spot could be potentially still more troubling than the Gulf area. Thus, one further lesson to be learned from this war should include the need to maintain, to pre- position in Israel -- in a "user friendly" atmosphere, to borrow a term from another field, American war material of a much greater volume than before, and this view has now been reinforced by the apparent negative Saudi feelings towards massive American pre-positioning. I stress this point because pre-positioning of American equipment and arms in Israel is sometimes described as a purely Israeli interest. Sure, it is in Israel's interest, but it is an American interest as well.

Returning to the more immediate matters at hand, over the years, American attempts at peacemaking in the Middle East have veered from the all-encompassing comprehensive approach to one of trying to effect progress through gradual steps. At least in the light of past events, but also if we look at some of the problems in the present situation, there is no guarantee that the strategy of trying to embrace all issues at once will be crowned with success.

Still, let me say, Secretary Baker is making great efforts and strides which we applaud and support. We do hope that America will be successful in bringing most of the Arab states to the negotiating table, with peace negotiations based on the one logical and indeed indispensable principle: real peace can only be brought about when both sides are willing to face each other at the negotiating table without pre-conditions, both of them knowing that only with its negotiating partner can anything be gained. This applies to the Palestinians as well, who must finally realize, after having been cruelly misled for generations by extremist, unrealistic, often corrupt leaderships, and either ignored or brutally exploited by various Arab states, that only with Israel, not against Israel, can they achieve anything.

And as to America, would she not be justified in saying to her former Arab coalition partners, in the Gulf area at least, "Look, gentlemen, we are not just intermediaries this time. We do have vital interests of our own in the Middle East. And the new world order, considering that we have close alliances and interests with both Israel and yourselves, does not allow a going back to the old world order of ongoing enmity and warfare and intolerance towards Israel."

My friends, no opportunity for peace in the area should be neglected, even where a country like Syria is concerned. But on the other hand, mistakes should not be repeated either, mistakes which not so long ago induced some people to believe that Iraq had all of a sudden had become a moderate or pragmatic state. Indeed, Israelis must be forgiven for not being overly confident about some of the expertise and advice offered to them about the Middle East in light of similar expertise and advice during the last few decades, including the period leading up and following the recent Gulf crisis.

One thing must, however, be clear. Whatever solution there will be, it must be based on compromise and not on a demand for total renunciation by the parties involved of all their interests and aspirations. Of formulae of compromise, there are more than one. Israel has not a priori ruled out any one of them. But in order to have any chance of success, none of them will be feasible unless they take into account the subject we have discussed tonight, Israel's security in the '90s or after. Thank you very much. (Applause.)

AMB. LEWIS: Thank you very much, Ambassador Shoval. I think there's a lot of food for some of our conversation tomorrow. We can analyze your speech and add it to our agenda, and I think it deserves a lot of careful consideration. We are delighted you were able to be with us tonight, and I think that concludes the program. Thank you very much. (Applause.)