The Reagan Administration reached some important conclusions about Middle East policy during its first term. In 1985, it tried to apply them. The framework for its diplomatic activism had been laid down in the September 1982 Reagan Plan, but to this were now added calculations on the difficulty of mediating an Arab-Israeli peace settlement, the need to await decisive action by the involved regional states, a skepticism about Arab eagerness for negotiations, and the belief that the United States must stand its ground until the proper opportunity for peace arrived.

In contrast to previous years, there was no regional crisis to force dramatic U.S. action. Nor was there any major upsurge of Arab-Israeli tension, internal upheaval, or threat to Persian Gulf security brought on by Islamic fundamentalist revolutionaries or a widening Iran-Iraq war. Instead, there were experiments with new political alignments, including cooperation among Iraq, Jordan and Egypt, between Jordan and the Palestine Liberation Organization (PLO), and even, at year’s end, between Jordan and Syria.

Fresh ideas were developed for forming a joint Jordanian-Palestinian delegation, frameworks for an international conference, and formulas for mutual Arab-Israeli recognition. While diplomatic maneuvers made little material progress in 1985, the channels opened might still provide a foundation for future breakthroughs. The two sides are still far apart, but some kind of negotiated solution seems more imaginable now than ever before.

Arab-Israeli peace is but an important aspect, rather than the sole consideration, of U.S. regional objectives, which continued to be defined by four principles: limiting Soviet influence while maximizing its own; encouraging regional stability against the danger of war or radical revolutions; supporting and strengthening allies; and assuring the continued supply of oil at reasonable prices. While, as always, there were numerous points of danger and tension in the Middle East, in 1985 the overall picture in regard to these four concerns was a reasonably positive one.

The United States has a greater degree of leverage in the Middle East because of the region’s lack of reliably consistent alliance systems or any internationally recognized leaders. As Arab states have implicitly and explicitly developed their separate identities, pan-Arabism has become a less tenable ideology. The willingness of Egypt to sign the Camp David accords, of Lebanese Maronite Christians to ally with Israel, or of Syria and Algeria to support Iran against Arab Iraq, all point to this decay. Despite Islamic fundamentalism’s inability to seize power anywhere outside of Iran, the movement has proved a source of divisiveness—through the Iran-Iraq war, terrorism and heightened communal tensions—rather than one of unity.

Egypt cannot play a leadership role in the region while it continues to be penalized for the Camp David accords; Iraq is tied up with an expensive war effort; Syria’s obvious ambitions have brought it isolation; Saudi Arabia’s economic leverage has steadily declined as its petroleum’s price and production have fallen. In this situation of "every state for itself," Washington’s role is very important. Several rulers seek an American deus ex machina to help them realize their respective political dreams.

The very conflict, search for security, and disunity that invite U.S. involvement also make it complex and frustrating for several reasons. First, there are discordant state objectives, not only between Arabs and Israel but equally among the Arabs themselves. Syria, for example, is determined to sabotage negotiations that would allow a Jordanian role on the West Bank, Egypt’s return to the Arab fold, or the emergence of an independent PLO. Jordan’s King Hussein and PLO chief Yasir Arafat will compete to dominate any future Jordan-West Bank confederation.

Second, there are internal contradictions in the bargaining positions and goals of each individual state. Jordan would like to have the West Bank back, but does not want to pay the price of recognizing Israel. Israel wants peace, but some Israeli political groups want to retain the occupied territory and almost all of them are determined to prevent PLO participation. Arafat would like to have his own West Bank state, but will neither recognize Israel nor designate Palestinian stand-ins to negotiate, because he fears Jordanian domination, Syrian revenge and a split in his own ranks.

Third, all of these difficulties are interconnected. It is hard to envision a diplomatic solution without Syrian participation but almost impossible to see any framework or outcome that would please Damascus and still be acceptable to Israel, Jordan and the PLO. King Hussein cannot step forward to negotiate without Arafat and, apparently, cannot persuade the PLO leader to make concessions either.

Consequently, the U.S. government has tended to focus on other more pressing—or promising—areas of the world, except when developments in the Middle East itself have forced action or given hope that activism might succeed.


During the Reagan Administration’s first term in office, Middle East policy went through three distinct phases.

From January 1981 to August 1982, the Administration sought to downplay the relative importance of the Arab-Israeli conflict in order to concentrate on Persian Gulf security problems emerging from the Iranian revolution, the activity of Islamic fundamentalist groups, and the Soviet occupation of Afghanistan. A series of events, culminating in the Israeli invasion of Lebanon, made a change in focus both necessary and potentially opportune.

From September 1982 through May 1983, the Administration pursued an activist policy aimed at developing a settlement to the Lebanese civil war and the Arab-Israeli conflict. The Reagan Plan proposed the establishment of a Jordan-West Bank confederation as a framework for Palestinian self-determination. In exchange for Israel yielding territory, the Arabs would recognize the state and agree to some border modifications that would enhance its security. As it happened, the U.S. efforts to end the Lebanese civil war and moderate the Arab-Israeli conflict both failed. Syria refused to withdraw from Lebanon; the Lebanese political factions could not settle their differences. Heavy losses among the U.S. marines shocked Americans into demanding their withdrawal. Meanwhile, Arafat, Hussein and Israeli Prime Minister Menachem Begin rejected President Reagan’s plan.

Disillusioned with these efforts, the Administration entered a third period, one of low activity, in its Middle East policy, which continued up to February 1985. More than a mere response to the presidential election year, this course was a logical reaction to its recent disillusionments and failures, plus a belief that new opportunities were lacking. U.S. policymakers reasoned that only an initiative by regional forces would make American involvement worthwhile.

A conjunction of regional developments—including a diplomatic initiative taken by King Hussein and the instituting of a new, more flexible government in Israel—set the stage for a fourth phase of U.S. policy in the opening months of 1985. Washington sought to encourage the formation of a joint Jordanian-Palestinian delegation as sought by Hussein, nudge it toward recognition of Israel, and create the basis for direct negotiations that would produce a solution within the general context of the 1982 Reagan Plan.

The changing fortunes and policy shifts of these earlier periods had never altered U.S. policymakers’ continued preference for some form of "Jordanian solution." U.S. policy was that self-government by the Palestinians of the West Bank and Gaza, in association with Jordan, offered the best chance for a durable, just and lasting peace. The key hurdles remained the conditions for PLO involvement in negotiations, the framework for talks, and the willingness and ability of the United States to invest the energy and initiative required to move the process forward.

Prospects for renewed U.S. diplomatic efforts along this course seemed promising in early 1985 in several respects. In Israel, Labor Party leader Shimon Peres had become prime minister at the head of a national unity government in August 1984. Peres was friendly to the Reagan Plan concept and eager to negotiate with Jordan. Further, one of the new cabinet’s first actions was to gradually withdraw Israeli forces from Lebanon (over a period extending from January through June 1985), a step that Jordan had earlier made a precondition for negotiations.

A further important consideration was that, by the terms of the coalition agreement, Peres was scheduled to hand over his office to Yitzhak Shamir of the Likud bloc in October 1986. Whereas Labor favored territorial compromise with Jordan on the West Bank (indeed, Peres and other party leaders had periodically met secretly with Hussein to discuss these matters), the Likud was more skeptical about the possibility of successful negotiations and more interested in permanently retaining the territories captured by Israel in the 1967 war. Thus, time became a central factor spurring all sides forward.

This incentive applied especially to King Hussein, who saw 1985 as a window of opportunity for seeking a political settlement. Not only did Hussein know that Peres was more open to compromise than Shamir, he feared that Israel was becoming more and more permanently entrenched on the West Bank. Hussein warned the November 1984 Palestine National Council meeting (held, significantly, in Amman) that time was not on the Arabs’ side. In this dangerous situation Hussein noted an opportunity for himself. A PLO weakened by having been driven out of Lebanon and split by the secession of pro-Syrian Palestinian forces was easier for Jordan to influence and perhaps even to control.

Hussein thus sought to adapt the Reagan Plan approach to his own needs and constraints, incorporating the PLO as a subordinate partner. By seeking Arafat’s consent to a joint Jordanian-Palestinian negotiating delegation, Hussein hoped to develop a series of talks with the United States, leading to some form of negotiations with Israel. The object was a peace agreement based on mutual recognition between the Arab side and Israel and on the establishment of a Jordan-West Bank confederation with Amman as the senior partner. The first step was a February 11, 1985, communiqué between Hussein and Arafat.

This agreement, made public by the Jordanian side, laid down rules for bilateral cooperation. It called for a solution involving an exchange of "land for peace," the acceptance of conditions "cited in U.N. resolutions," total Israeli withdrawal from the West Bank, a Palestinian "right to self-determination" but only within the framework of a confederation of Jordan and the West Bank, leaving vague how the power would be shared between Jordan and the PLO.

Almost immediately after the Jordanian government announced the communiqué, however, both individual PLO leaders and the PLO Executive Committee threw doubt on its contents, demanding further amendments including: a joint delegation consisting of all the Arab governments plus the PLO, independence for a PLO-led Palestinian state, criticisms of the "land for peace" formula, insistence on their refusal to recognize Israel or to accept U.N. Resolutions 242 and 338, and refusal to cede representation (even temporarily) to non-PLO Palestinians (even those willing to follow Arafat’s orders). Said PLO leader Hani al-Hassan, "Frankly and clearly, I say that we reject [U.N.] Resolution 242. We rejected it in the past and will reject it in the future." Warned PLO "foreign minister" Faruq Qaddumi, "If Jordan sees any contradiction in its view of the draft formula with our understanding and point of view, then it is better to call a halt."

The PLO’s obduracy resulted from a number of factors. Having barely escaped Syrian domination, Arafat was not about to accept Jordanian hegemony. Rather than freeing him from the need to appease his most hardline colleagues, the secession from the PLO of pro-Syrian rejectionists only added credibility to the threats of the most militant elements remaining in or close to the organization. Arafat retained his survivor’s habit of keeping all options open while committing himself to no single course of action. He also retained a deep mistrust of U.S. and Israeli intentions.

In short, the situation in February 1985, while promising, was reminiscent of the intra-Arab impasse that had produced Hussein’s rejection of the Reagan Plan two years before. Apparently, the Jordan-PLO accord was not finalized when Amman rushed to publicize the draft agreement. Jordan’s action out-maneuvered the PLO but could not prevent Arafat from trying once again to escape the corner into which Hussein had prodded him.

Consequently, while the February 11 accord was generally in line with U.S. policy, at least as interpreted by Jordan, it lacked some vital clarifications and principles, including an unambiguous expression of the PLO’s position and intentions. These were the issues on which U.S. diplomacy would concentrate for the rest of 1985 in seeking to push forward a peace process.


Two basic problems—the indeterminate policy of the PLO and the framework within which negotiations would be conducted—made the U.S. task a difficult and complex one.

The United States had to explore whether the PLO was really willing to accept U.N. Resolutions 242 and 338, negotiate seriously with Israel, abandon the use of terrorism and agree to a final recognition of Israel. Previous experience, reinforced by his behavior in 1985, showed that Arafat was too restricted by internal PLO conflicts, Syrian threats, fear of being controlled by Jordan, historical ideological commitments and lack of control over his own organization to take such a major step. He might simply be maneuvering for U.S. recognition without making any concomitant concessions, or he might be seeking a stronger position—a military presence in Jordan or even control over the West Bank—from which to continue a long-term revolutionary and terrorist campaign against Israel.

Successive U.S. administrations had preferred a Jordanian option precisely because they deemed an independent Palestinian state under Arafat’s leadership to be contrary to U.S. national interests. Policymakers argued that a PLO state really would not be a stabilizing force in the region because it would have revanchist ambitions against Israel, or even Jordan, that would lead to further, chronic violence. And would the PLO’s long-standing alliance with the U.S.S.R. and the radical stance of many of its leaders seriously threaten the United States’ regional standing?

For these reasons, Hussein’s approach was appealing to the Administration. But, by the same token, the Administration wanted to be sure that Hussein could deliver PLO support along the promised lines, leading to a successful diplomatic process and a lasting peace.

Then there was the matter of the framework for negotiations. Hussein and Arafat insisted on an international conference including the members of the U.N. Security Council and all relevant Arab states. Washington and Jerusalem wanted direct negotiations, arguing that an all-inclusive international conference would be doomed to failure. Damascus could be expected to try to wreck the meeting by pushing the Arab side toward intransigence. Moscow would try to seek Arab favor and undermine the moderates by raising maximalist demands. These considerations had led both the Carter and Reagan Administrations to abandon a Geneva conference framework that would have the United States and U.S.S.R. as co-chairmen.

During the six months after the February 11 communiqué, the United States stressed diplomatic explorations with Jordan and Israel aimed at solving the issue of Palestinian participation. After failing to find an acceptable joint delegation, Washington shifted its emphasis to gaining a compromise over the diplomatic framework for talks. The fundamental U.S. approach on the representation issue was to give the PLO a choice. Either Arafat could find some format to indicate his willingness to recognize Israel or he could designate pro-Arafat but non-PLO Palestinians to represent his interests in preliminary exchanges.

Building on the February 11 communiqué and the expected relative flexibility of Prime Minister Peres, the Reagan Administration began in April to launch a major sounding-out effort. As Assistant Secretary of State Richard Murphy explained the new policy: "The parties in the region have imparted a new momentum to the search for peace. . . . We strongly support King Hussein’s efforts to move toward negotiations, but only time will tell whether the agreement will ultimately enable him to do so."

Shortly thereafter, with Peres expressing willingness to negotiate with a Jordanian-Palestinian delegation, Murphy went to the Middle East to assess the situation. This marked the beginning of an attempt to coordinate such a meeting. On a visit to Washington in late May, King Hussein presented a comprehensive plan for moving the process forward. This four-stage blueprint demonstrated both the promise and weaknesses that mark the current phase of the diplomatic process:

1. The United States would meet with a Jordanian-Palestinian delegation including Palestinians who were not PLO members but who would take orders from the PLO. Reactions to this first step were uneasy. Israel worried that such a meeting would constitute U.S. recognition of the PLO without any commensurate Arab concession. The Administration was generally willing to meet with a Jordanian-Palestinian delegation, but believed that the encounter should not take place until it was clear that the exchange would not be a dead end. Hence, Washington wanted a clear reason, if not outright guarantees, to be sure that any meeting would produce progress toward direct negotiations between the Arabs and Israel.

Hussein was asked to submit the names of potential Palestinian participants and he, in turn, requested a list from Arafat. The result was disappointing: the PLO’s list presented in July, even after Jordanian vetting, consisted almost entirely of PLO activists. When Peres, after rejecting the others, accepted two of the proposed delegates, the PLO withdrew the names of those two men. Despite its less demanding criteria, Washington also found the PLO-Jordanian list unacceptable since almost all those named were clearly mid- and top-level PLO leaders. This fact contradicted not only the U.S. position—no recognition of the PLO until it expressed a willingness to recognize Israel and cease the use of terrorism—but also Hussein’s own formula.

2. The purpose of the U.S. meeting with a Jordanian-Palestinian delegation, in the Hussein initiative, was to clear the way for U.S. recognition of the right of the Palestinian people to self-determination, within the context of a confederation with Jordan. Arafat, according to King Hussein, would then be ready to announce his willingness to recognize and negotiate with Israel by accepting U.N. Resolution 242.

Secretary of State Shultz wanted, but never obtained, PLO confirmation of Hussein’s claim. Although Arafat did not denounce Hussein’s efforts, his top colleagues repeatedly contradicted the Jordanian king’s assertion throughout the spring. This behavior was of great importance in maintaining Washington’s skepticism. Just as the Administration wanted a meeting between Murphy and a Jordanian-Palestinian delegation to lead toward direct negotiations, it also expected the immediate aftermath to include an unambiguous recognition of Israel by Arafat. In short, events cast doubt on Hussein’s ability to deliver on his own plan.

3. Hussein proposed that, contingent on the exchange of recognitions planned in step two, the United States would hold another meeting with another Jordanian-Palestinian delegation, which would then include PLO officials, to discuss the details for an international peace conference. But the statements of PLO leaders and the composition of the proposed Jordanian-Palestinian delegation seemed to prevent the enactment of step two entirely. The U.S. government was, in effect, asked to recognize the PLO and accept an international conference without prior assurance of any changed PLO policy or eventual direct negotiations.

4. An international conference of the five Security Council members plus Israel, the PLO, Jordan, Egypt and Syria would convene to produce a peace agreement. The United States, opposed to an international conference, wanted the fourth stage to be a direct, face-to-face peace conference between Israel and a Jordanian-Palestinian delegation. As the situation evolved, Washington remained more flexible than Israel about permitting PLO involvement, but Israel eventually proved more willing to compromise on a multilateral negotiating framework.

Israel’s response to Hussein’s ideas was given by Prime Minister Peres in a five-point plan announced on June 11. He called for a Jordanian-Palestinian-Israeli summit with U.S. participation. The U.N. Security Council members would endorse the meeting without actually participating. Commented Peres, "I believe that Hussein needs peace [and] that he cannot proceed without the Palestinians and possibly, in his opinion, without the PLO either."

Despite these very real problems and differences, the Administration knew that the gap between the Arabs and the Israelis was at least narrower than it had ever been before. To encourage Hussein, whose sincerity was admired in Washington, the State Department obtained from Congress $250 million in economic aid for Jordan (the previous assistance level had only been $20 million a year) and held out the possibility of a major arms sale as well.

But the Administration also expected a resolution of several problems: the composition of the joint delegation, PLO recognition of Israel, a linkage between the steps Hussein proposed, and direct negotiations rather than an international conference. This required a better offer from Hussein and Arafat. As Murphy put it in late June, "If 1985 is the year of opportunity, as Arab leaders say, then the Arabs themselves are going to have to make some hard decisions."

By July, the Arab failure to produce a list of Palestinian delegates acceptable to either the United States or Israel was dimming hopes for success. Building on its experience with the Reagan Plan, the Administration put the onus on the regional actors to ensure change in Arab attitudes, and the timing for "a big push" was said to be "not an exclusive American calendar."

In contrast to the big push for the Reagan Plan in 1982-83, the Middle East was not the Administration’s top priority in 1984-85. By the same token, unlike the initial 1981-82 era, the United States was ready to press forward with serious efforts if the potential for successful negotiations seemed promising. Until negotiations were imminent or prospects were more fluid, however, the White House left the exploratory phase in the hands of the State Department’s middle echelon.

A visit by Murphy to Jordan in August did not succeed in removing the obstacles. In fact, Jordanian Prime Minister Zaid al-Rifai stated that his country would reject any U.S. demand that a meeting lead to direct Arab-Israeli talks. The State Department pursued several options to reduce Arab intransigence. One much discussed idea was that the proposed U.S. arms sale to Jordan could be used to prod Hussein toward further action. Israel was skeptical about this approach, and it quickly emerged that the members of Congress who would oppose the sale were numerous enough to ensure its defeat. Opponents felt such a deal should serve as a reward for Jordanian recognition of and negotiations with Israel, rather than as an incentive to bring them about.

Syria presented an additional obstacle to the progress toward negotiations. President Hafez al-Assad’s ambitions for regional power, including domination of Lebanon and the Palestinian fate, posed a threat to Jordan if King Hussein proceeded with serious negotiations. Syria’s assets included its hegemonic position in Lebanon, control over some Palestinian forces, and status as the U.S.S.R.’s most important regional ally. Damascus had proven its determination by outlasting Israeli and U.S. attempts to put anti-Syrian factions in power in Lebanon. But Syria’s limited control over Lebanon was based on its skillful manipulation of the warring elements; Assad was no more able than any other outside force to impose a peaceful political solution there.

By committing himself to the support of anti-Arafat Palestinians, however, Assad had forfeited the very flexibility that had ensured the Syrian position in Lebanon. Syrian attempts to control the PLO only drove Arafat closer to Hussein. This new alignment made Damascus all the more determined to block any process that would bring together its enemies (Israel and the United States), and its rivals (Egypt, Jordan and Arafat’s PLO). For Syria, successful negotiations were anathema, not because they might foreclose its regaining the Israel-occupied Golan Heights—a relatively minor issue—but rather because they would create a new balance of power and thus threaten to reduce Syria permanently to second-rate status in the Arab world.

Nevertheless, given undoubted U.S. support for Jordan in the event of a Syrian invasion, as well as the strength of hostile Israeli and Iraqi forces on its border, Damascus was not likely to send its army into Jordan. The real danger was that Syria would step up its campaign of terrorism, assassination and subversion against Amman.

Further, the underlying problems of the peace process had less to do with Jordanian confidence in the United States (which the proposed arms sale would supposedly strengthen), or with Hussein’s fear of a Syrian attack (which the sale would allegedly counter), than with the constraints that PLO inflexibility imposed on the Jordanian government. Hussein’s possession of more guns would not ease his need for Arafat to be more forthcoming with PLO recognition of Israel and engagement in direct negotiations.

The Administration’s hopes were pinned on Hussein’s visit to the United States in September. On September 17 the White House sent Congress prenotification of the $1.9 billion arms sale—including 40 advanced fighter planes, 12 mobile antiaircraft missile batteries, and 72 Stinger surface-to-air missiles. This step was timed to give Hussein an additional push at the critical moment. If the king did not give assurances persuasive to Congress, the Administration could withdraw the proposal.

At the United Nations Hussein declared, "We are prepared to negotiate, under appropriate auspices, with the government of Israel, promptly and directly, under the basic tenets of Security Council Resolutions 242 and 338." He maintained, of course, that an international conference provided appropriate auspices for negotiations, but he went a bit further, defining it as an umbrella for direct talks rather than as a substitute for them.

After his meeting with Hussein on September 30, President Reagan remarked, "Jordan has been moving steadily and courageously forward in the search for a peaceful negotiated settlement in the conflict in the Middle East [and] has not wavered despite attacks and threats." Washington’s goal was still "direct negotiations, under appropriate auspices, before the end of this year."

Hussein’s visit was nonetheless disappointing for the Administration. The king had brought no new ideas and would not publicly declare an end to the state of belligerency with Israel. The two sides were no closer to setting up a meeting with an acceptable Jordanian-Palestinian delegation, and the peace process seemed stalled after eight months of intensive efforts. When Congress postponed consideration of the arms sale until March 1, 1986—unless direct talks started in the interim—the White House did not forcefully object. Jordan responded by easing its relations with Syria; Amman pledged to cease support for Syrian Islamic fundamentalist revolutionaries and, late in December, King Hussein traveled to Damascus for a meeting with President Assad. By these steps, however, Hussein did not renounce his option to continue the peace process if and when that seemed a promising alternative.


The crisis of terrorism and reprisal that ensued in October did not in itself stymie the peace process. Unresolved problems and conflicting positions were already well defined. Of course, the PLO’s continued use of terrorism had long been a factor inhibiting U.S. and Israeli willingness to recognize and negotiate with the organization. In late April, when the PLO was supposedly following a new diplomacy-oriented course, Israel sank a boat carrying a PLO terrorist task force which had been dispatched from Algeria by Arafat’s right-hand man, Khalil al-Wazir. Secretary Shultz warned, "Those who perpetrate violence deal themselves out of the peace process," but the issues that had inhibited that process in the February-September period had been political ones, not the existence or practice of terrorism.

Terrorism had earlier played a major role in wrecking the U.S. marines’ mission in Lebanon. Seven Americans had also been kidnapped by Islamic fundamentalist groups in Beirut and held hostage for well over a year. The Administration quietly warned Iran that retaliation would follow if any of them were harmed. But while the White House had courted a reputation for toughness, in fact it had not carried out reprisals, or even attempted missions to rescue hostages, in several terrorist incidents.

Both the political entanglements that terrorism could create and the cautious U.S. policy underlying the hardline rhetoric were vividly illustrated when, in June 1985, a U.S. airliner was seized by Shi‘ite fundamentalist hijackers and flown to Beirut. One American passenger was murdered and 40 others were held for over two weeks.

The Administration faced a complex situation. On the one hand, while the hijacking was carried out by pro-Iranian fundamentalists, a large element of control over the situation quickly passed into the hands of Nabih Berri, leader of Amal, Lebanon’s dominant Shi‘ite group. While an ally of Syria, Berri was also a communal nationalist who had little interest in Islamic revolution or in war with the United States or Israel as an end in itself. The crisis, then, had more to do with the ramifications of Lebanese politics—with each group trying to prove its militancy and effectiveness—than it did with U.S. policy or interests. After all, the hijackers’ main demand was that Israel free Shi‘ite militiamen and terrorists captured in southern Lebanon. But Israel was already in the process of letting them go, and the real issue seemed to have become which Shi‘ite group could appropriate the credit for this achievement.

The official U.S. position continued to be a refusal to negotiate with terrorists or to meet their demands. In practice, however, the Administration urged Israel to accelerate the release of the prisoners. Syria, worried about any spread of pro-Iranian Islamic fundamentalism in Lebanon, used its leverage with the Shi‘ite groups. The hostages were finally released safely.

Despite the apparent American national fixation with the hostage crisis—U.S. media coverage reached unprecedented saturation proportions—the affair had little or no lasting political impact. The situation produced neither U.S.-Syrian rapprochement nor any serious U.S.-Israeli friction. Specific terrorist incidents attract a great deal of attention for a short period of time, but they rarely alter political circumstances.

At the same time, the Beirut airport hostage affair showed the continued uncertainty among U.S. political leaders and the general public on the question of how to deal with terrorism. Polls showed that most Americans wanted the hostages to be released even if this required yielding to terrorist demands. A U.S. attempt to organize an international boycott of Beirut’s insecure airport gained almost no support, even among U.S. allies. In a major speech, President Reagan attacked Iran and Libya, though not Syria or Iraq, as countries supporting terrorism. But the debate within the U.S. government on what, if anything, to do about such behavior remained unresolved. Some observers claimed that Washington’s frustrations in combating terrorism lessened U.S. credibility. One of the terrorists jeered, "The American war machine is nothing but a child’s toy" and argued that the hijacking demonstrated the "ability of the oppressed to confront America." Yet, far from viewing the United States as helpless, Middle East leaders complained of U.S. bullying, while they clamored for American aid, arms, technology, support and mediation on a whole range of issues.

The dramatic series of events in September-October 1985 revived some of these controversies. Attacks against Israeli civilians culminated in the murder of three Israelis in Cyprus on September 15. Israel blamed the PLO, and a fortnight later launched a bombing attack on the organization’s offices in Tunisia. Six days after that, Palestinian terrorists, whose close links with the PLO were later revealed, hijacked an Italian cruise ship, the Achille Lauro, murdering an elderly, crippled American before surrendering to Egyptian authorities. Three days later, an Egyptian airliner carrying the three terrorists was forced by U.S. fighter planes to land in Italy, where the terrorists were tried and convicted.

A number of apparent, but ultimately short-lived, frictions for the United States arose from these developments. Much was made of conflicting statements between President Reagan and State Department officials over Israel’s raid against PLO facilities in Tunisia. The President said that Israel and other nations had the right to strike back at terrorism, "if they can pick out the people responsible." Secretary Shultz’ statement was designed to be more critical of Israel and stressed regret for Tunisian casualties. The United States abstained on a U.N. resolution that condemned Israel for the attack without mentioning the terrorist actions that had motivated it. Although the ambiguity could have been handled better, it did reflect the diversity of U.S. interests: the United States is an ally of Israel and enthusiastic supporter of counterterrorism, but at the same time is ally of several Arab states, including Tunisia, and a mediator in the Arab-Israeli conflict.

Relations were also strained with Italy, which refused U.S. requests to extradite the terrorists and which let PLO leader Abu Abbas, the affair’s apparent mastermind, flee the country; and with Egypt, which resented the U.S. action taken against one of its planes in spite of President Hosni Mubarak’s central role in securing the release of the Achille Lauro passengers. These tensions should not be overstated. The Italians were soon forced to admit that Abu Abbas had been behind the Achille Lauro attack; the Egyptians later used U.S. assistance when terrorists hijacked one of their planes to Malta in November. When the heat of specific terrorist incidents dissipates, tempers cool as well.

As for the peace process, which was already in significant trouble, the Achille Lauro affair made the PLO seem less attractive as a negotiating partner and less credible as a moderate force. A planned meeting between a joint Jordan-PLO delegation and Britain, which seemed almost like a dress rehearsal for the long-awaited conference with U.S. representatives, fell through after the PLO refused to authorize signing a statement that would imply willingness to recognize Israel. Amman sided with London in criticizing Arafat.

Hopes for progress stayed alive, but the chances for a breakthrough dimmed considerably, even after Peres made a conciliatory speech at the United Nations in late October. The Israeli prime minister put forth the idea that direct talks could be initiated with support from an international forum, a concession to Jordan’s desire for an umbrella of that sort. He also expressed willingness to meet with a Jordanian-Palestinian delegation "comprising delegates that represent peace, not terror," an implication that he would accept PLO participants if that organization’s policy ever did change.

Perhaps Mr. Shultz provided the best summary of the situation after the year’s experience with the peace process. The secretary of state said:

The PLO has been involved, in recent weeks, as in the past, in acts of terror and violence; and I don’t see how those who are perpetrating terror and violence against one of the parties deserve a place at a peace table. . . . So, those who are ready to sit down with Israel and try to work out peace, those who accept Resolutions 242 and 338, and those who are prepared to stop the so-called "armed struggle" deserve a place at the peace table, whatever their label may be—and those who aren’t willing to do that don’t deserve a place, in my opinion.

As this statement indicates, 1985 was generally a year of close U.S.-Israeli cooperation. U.S. aid levels were at an all-time high, amounting to one quarter of the entire U.S. foreign assistance program. This leverage was successfully employed early in the year to pressure Israel toward an economic austerity program to deal with its severe inflation. In April the United States ratified a Free Trade Area that would encourage trade and technology transfer. However, bilateral friction and some restrictions on information exchanges followed the arrest, on November 21, of U.S. Navy employee Jonathan Pollard, who was stealing American intelligence reports on the Arab world for Israel. Israel promised cooperation in the investigation, but bitter feelings remained within the U.S. bureaucracy and even among American Jews supportive of Israel.


Despite the emphasis on the Arab-Israeli peace process, the United States was also concerned with the region’s ongoing Iran-Iraq shooting war and with the preservation of Persian Gulf stability and security. The Iran-Iraq war, however, remained an inconclusive struggle and one which the United States could make little contribution toward ending.

By the beginning of the year, it had become obvious that Iran’s two strategies for gaining victory—a military breakthrough or Iraq’s economic collapse—were leading nowhere. Iranian offensives suffered heavy losses without breaking Iraqi lines. New Iraqi oil pipelines through Turkey and Saudi Arabia involving private U.S. companies and credits from the U.S. and other governments strengthened Baghdad’s ability to resist. Indeed, it was Iran that faced some belt-tightening as Iraqi attacks on the Kharg Island terminal cut temporarily into Teheran’s petroleum-exporting capacity.

While Iran’s high casualties and economic austerities—1985 oil revenues were only 61 percent those of 1984—caused more discontent with the war and government, dissatisfaction was not dangerous enough to press Iranian leaders toward seeking peace. The communist, leftist, democratic and monarchist opposition movements had all been smashed. In addition, Ayatollah Ruhollah Khomeini was determined to carry on the war, and no politician dared challenge his will. Even though Ayatollah Hussein Montazeri was named Khomeini’s future successor at year’s end, the charismatic national leader remained active and the Islamic regime was well entrenched.

As with the Arab-Israeli conflict, the United States’ varied interests in the Iran-Iraq war forced some complex calculations. While the greatest immediate threat was an Iranian victory or subversion endangering the friendly states of the Persian Gulf, U.S. leaders also had to take into account the danger that a cornered Iran might turn decisively toward the Soviet Union. The resulting policy was one of public neutrality regarding the war, combined with a tilt toward Iraq. U.S. willingness to criticize Iraq over its use of poison gas in combat showed the former factor; Baghdad’s long-awaited decision to reestablish diplomatic relations with Washington symbolized the latter part of the equation.

Iraq wanted the United States to go even further. It successfully urged Washington to put more pressure on allies to stop selling equipment to Iran. The frequent, though mistaken, suggestions of Iraqi leaders, echoed by other Gulf Arabs, that a determined United States could bring the war to an end, demonstrated their continued belief in—even exaggeration of—U.S. power.

Shifting economic developments made the Gulf region less strategically critical and influential, although it was still of great importance, in U.S. considerations. Indeed 1985 might even be taken as marking the end of the oil boom that had begun a dozen years earlier. The output of crude oil by the Organization of Petroleum Exporting Countries in the second quarter of 1985 was 14.7 million barrels a day, the lowest in 20 years. Saudi Arabia cut its output from its 1981 peak of 9.6 million barrels a day down to barely three million barrels a day. Non-OPEC producers rapidly increased production to gain desperately needed income. OPEC’s market share fell from over one half of oil traded internationally to less than one third.

OPEC was forced to make three price cuts throughout the year due to these new sources of production, improved Western conservation, and the lingering effects of worldwide economic slowdowns. At a December conference, the formerly dominant cartel acknowledged the declining coordination of its members and their widespread cheating against its quota system. While the gathered oil ministers said their governments would defend a "fair share" of the market, several member and non-member states announced new price reductions. For the first time, prophecies of OPEC’s collapse seemed credible. All the oil producers had less money to spend for imports and internal investments. Although there was no immediate crisis—a large cushion of capital had been built up over the previous decade and foreign workers could be sent home in the event of widespread unemployment—this fiscal pressure seemed to signal future political problems.

These events, and some experiences from previous years, also heightened U.S. skepticism over Saudi Arabia’s potentially positive role in resolving regional problems. The Saudis were largely absent from the diplomacy over the peace process—Jordan and Egypt played the key Arab roles. Nonetheless, the Administration still emphasized the indirect and behind-the-scenes U.S. role in strengthening local forces, primarily the Saudi-led Gulf Cooperation Council, to provide the maximal degree of security for themselves.

Further, in an effort to initiate a major new arms sale to Saudi Arabia, later abandoned, a Department of Defense leak to the press suggested that Riyadh had agreed to allow the United States use of bases in Saudi Arabia in the event of Soviet aggression, the specific contingency for which the U.S. Rapid Deployment Force is nominally intended. The quiet nature of these efforts sharply contrasted with the outspoken rhetoric of 1981, but the policy itself has remained fairly consistent. These plans are, however, still untested, and there is reason to doubt that the Administration and Department of Defense have yet sorted out the optimal kinds of responses to internal instability in the Gulf.


Egypt continued to make progress toward regaining its key role in the Arab world. President Mubarak was adept at pursuing balanced policies: he normalized relations with Jordan and, for all practical purposes, with Iraq and the PLO, without retreating from Egyptian positions. Cairo carefully cultivated peaceful relations with Israel while keeping them at a fairly cool level. At home, Mubarak cleverly defused Islamic and secular oppositionists by simultaneously courting them with meetings and minor concessions and containing them through selective arrests and restrictions.

On one level, the regional situation proved former President Anwar al-Sadat to have been correct. So great is Egypt’s political, cultural and strategic weight in the Arab world that the other states cannot long exclude it. While Mubarak moved slightly away from Sadat’s policy of close alignment with the United States, he protected the relationship that had provided Egypt with $10 billion in aid over the last decade. Egypt is the second-largest recipient of U.S. assistance in the world, and it shares with Israel the advantage of having all its military aid converted from loans to grants.

Domestic affairs proved more intractable. The tremendous power of incumbency in highly centralized Egypt was Mubarak’s great asset. The president’s control of the national finances, the army and the giant bureaucracy gave him a strong political base. While Islamic fundamentalism had some appeal for many Egyptians, most of them supported reformist—rather than revolutionary—varieties of the creed. They were more concerned with cultural issues and with seeking different government policies than in seeking to overthrow the regime entirely.

The real difficulty for any Egyptian government is that so many of the country’s problems are seemingly insolvable: a high population and birth rate, a lack of resources and land. Western experts can easily point out the flaws in Egyptian policy. Too much money is spent on the army, on the ineffective bureaucracy and on food subsidies that keep prices so low that peasants can afford to feed bread to their livestock. An Egyptian can reply, with equal logic, that changes in this system would threaten the regime’s survival. Cutting the military budget might encourage angry officers to organize a coup d’état. Reducing the bureaucracy would throw out onto the street the kind of educated young men who would be natural leaders of a revolution. Slicing subsidies, as Sadat discovered in 1977, could set off massive riots.

Egypt’s assets include its Sinai oil production, Suez Canal revenues, U.S. aid, and remittances—albeit declining ones—from workers in the Persian Gulf. Dependence on foreign aid offends Egyptian pride, a factor that played an important part in Cairo’s resentment and later expulsion of the Soviets. Egypt now boasts the largest U.S. AID mission in the world and will soon have a high-rise U.S. embassy whose appearance on the Cairo skyline will be a constant reminder of the American presence. The Achille Lauro affair added to the potential friction. Economic problems at home and the necessity to channel Islamic or nationalistic sentiments might encourage Mubarak to develop an even more nonaligned foreign policy.

The greatest immediate foreign policy concern for Egypt, however, seems to be the subversive efforts of Libya’s Muammar al-Qaddafi. After the April coup against Sudan’s pro-Egyptian president, Jafar al-Numeiri, Qaddafi also stepped up his intervention in Sudan. The Reagan Administration has long identified Qaddafi as a key antagonist and sponsor of international terrorism and, since 1981, has been periodically discussing covert operations against him. Terrorist attacks at the Rome and Vienna airports at the end of 1985, praised and apparently supported by Libya, intensified U.S. antagonism toward Qaddafi. The Administration’s efforts to organize pressures on Libya were seriously constrained, however, by the European allies’ refusal to cooperate. If any real subversive effort was going to be mounted against the Libyan regime, Cairo would play a central role in encouraging and implementing it. So far, while the Egyptians would like to see Qaddafi eliminated, political and logistical considerations have deterred them from spearheading such a campaign.


Despite the inevitable vicissitudes and uncertainties, the overall strategic and political situation in the Middle East was not unfavorable to U.S. interests at the end of 1985. Terrorism, often aimed against Americans, hypnotized the media and caused terrible losses in human terms, but hardly destabilized the region. Islamic fundamentalism proved incapable of mounting successful or even serious revolutionary challenges to any of the region’s regimes. The Lebanese civil war raged on, but it was clear that neither Syria nor radical anti-American forces could really dominate the country. A bloody Iran-Iraq war remained indecisive but showed no sign of spreading or endangering the Persian Gulf oil exports.

Significantly, the United States retained a wide variety of allies, while the U.S.S.R.’s influence remained extremely limited. Moscow’s achievement of diplomatic relations with Oman and the United Arab Emirates only symbolized how weak the Soviet regional position had become. Soviet problems arose from their inability to supply aid and modern technology, broker peace negotiations or demonstrate reliable support for their own clients. Since some of these shortcomings stemmed from Moscow’s lengthy leadership vacuum, the installation of the Gorbachev team in power might prove the basis for a new Soviet activism in the region.

If the Iranian revolution and the failure of U.S. leverage in Lebanon demonstrated the limits of American power, especially military power, in the region, 1985 provided a lesson on the continuing importance of the United States’ political and diplomatic role. U.S. attempts to mediate—and its failure to resolve—the Arab-Israeli conflict often seemed to produce acrimonious reactions in the area, yet it was still universally acknowledged that only Washington could foster any peaceful conclusion.

A second lesson is that regional forces had to take the lead in seeking to solve their own conflicts. The United States could help this process but would not be able to make a breakthrough against the resistance of those directly involved in any dispute. But, within this framework, controversy remained over the proper degree of U.S. activism and initiative in the peace process.

With the Arab-Israeli peace process stalled at the end of 1985, there is a significant danger that the United States could become too passive or reactive, missing opportunities for progress. The Administration’s patience and increased sophistication about the workings of Middle East politics is welcome, but it should not abandon the responsibility of staying active in promoting negotiations even while it remains skeptical about their prospects. One does not have to be a cynic to note that the appearance of U.S. concern is as important in the region as is the reality.

Technical issues should not obscure the basic problem of the U.S. mediation efforts, which, as former Assistant Secretary of State Harold Saunders has explained, "is not how to arrange a negotiation [but] how to make it politically possible—even imperative—for leaders in the conflict to commit themselves to negotiation." Jordan, the PLO, Israel, or Syria do not fail to make peace merely because the United States has not managed to convince them to do so, but rather because of very real internal and regional considerations. Arafat is unwilling to risk domination by Jordan, or to lose control of the PLO, by stepping forward; Hussein is paralyzed by Arafat’s intransigence, not by a lack of U.S. arms.

At the same time, the long, slow trend toward closing the political gap is based on long-term material realities, not just momentary opportunities. The fact that the Arabs have proven unable to defeat Israel, and the heavy Israeli burden of the occupation and permanent military preparedness, are important factors that are pushing the local forces toward new, perhaps even more promising, efforts to shape their future.

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  • Barry Rubin, a 1984-85 Council on Foreign Relations fellow in the office of Senator Gary Hart (D.-Colo.), is now a fellow at the Foreign Policy Institute of The Johns Hopkins School of Advanced International Studies. His latest book is Secrets of State: The State Department and the Struggle over U.S. Foreign Policy. Copyright © 1986 by Barry Rubin.
  • More By Barry Rubin