PREVIEW-Olmert woes, dwindling time cloud Rice Mideast trip
WASHINGTON, June 10 (Reuters) - U.S. Secretary of State Condoleezza Rice visits the Middle East this weekend facing the reality that political turmoil in Israel and the Bush administration's dwindling time may dash hopes of an Israeli-Palestinian peace deal this year.
Analysts said the corruption scandal dogging Israeli Prime Minister Ehud Olmert has dramatically reduced the chances of a peace deal before President George W. Bush leaves office in January and could force Rice to consider scaling back her ambitions.
So far there are few signs that she is prepared to do so as she leaves Washington on Wednesday on a trip that will take her to Paris for an Afghan donors' conference on Thursday and then to Jerusalem and Ramallah for her sixth visit this year.
Rice plans to meet Olmert and Palestinian President Mahmoud Abbas and to hold three-way talks with their lead negotiators, Israeli Foreign Minister Tzipi Livni and former Palestinian Prime Minister Ahmed Qurie.
She also is expected to have a three-way meeting with Palestinian Prime Minister Salam Fayyad and Israeli Defense Minister Ehud Barak, who is a key player in determining how far Israel goes to ease the lot of Palestinians in the West Bank.
Despite Olmert's difficulties, the administration has said it will continue to press for a peace agreement this year -- the goal Bush announced at a high-profile peace conference he hosted in November in Annapolis, Maryland.
"The question is not about his desire but about his ability," said a senior U.S. official of Olmert's predicament. "I'd rather be criticized for an element of romanticism than for an element of neglect."
However, Western, Palestinian and Israel officials have all acknowledged privately that Olmert's corruption investigation could trigger new elections, dimming -- if not snuffing out -- the chances of a deal this year.
Some analysts said Bush should now concentrate simply on handing over an active peace process to his successor, rather than on striving to produce some kind of a deal that may be impossible to reach given Israel's political uncertainty.
They suggested Washington also work to improve conditions in the West Bank by strengthening Palestinian security forces and governing institutions and by pressing Israel to remove roadblocks Palestinians say cripple their economy.
'DEAD MAN WALKING'
"This is what I call the royal handoff," said Aaron David Miller, a former U.S. peace negotiator and the author of "The Much Too Promised Land: America's Elusive Search for Arab-Israeli Peace."
Miller said if Bush stepped down with an active peace negotiation and stability on the ground, he could make a case that he left matters better than he found them despite critics' belief that he neglected the issue for much of his presidency.
"Let the administration say, in one of the great talking point of the decade, 'We inherited a terrible hand, violence, absence of trust, no negotiations, and we are now passing to our successor a working peace process.'"
Daniel Levy, an analyst at the New America Foundation, said the administration did not yet appear willing to concede defeat, but argued that Israel was simply in no position to conclude a peace deal given the cloud over Olmert.
"It's not actually helpful to try to force a piece of paper through because the Israeli political system cannot absorb such a development," he said. "Politically speaking, fortunately or not, fairly or not, Olmert is a dead man walking."
Olmert has rebuffed calls that he resign because of allegations that he took envelopes stuffed with cash from a U.S. businessman. Olmert, who has said he would resign if indicted, and the New York-based businessman have denied any wrongdoing.
"This is a period of some ambiguity and awkwardness for the United States," said a senior Bush administration official, adding the United States did not wish to do anything that might hint at support for any Israeli faction over another.
While acknowledging that Israel's political uncertainty would likely make Israeli politicians reluctant to take bold steps and would frustrate Palestinian negotiators, he said he did not think the U.S.-backed effort was a lost cause.
"It strikes us as an imperative for both Israelis and Palestinians to try to come to an agreement over a two-state solution," he said. "We're not tilting at a windmill." (Editing by David Alexander and Mohammad Zargham)
© Thomson Reuters 2009 All rights reserved



