THE MONTH since Yasser Arafat's death has seen an encouraging flurry of movement on all sides of the Israeli-Palestinian conflict. Palestinians have scheduled elections for president next month, and polls show a surge of support for the moderate leadership that succeeded Mr. Arafat. The Israeli government quickly agreed to facilitate the elections, and Prime Minister Ariel Sharon won approval from his Likud Party to form a centrist government to implement his proposed withdrawal from the Gaza Strip. Violence has tapered off, though not ceased, and there are reports that Egyptian efforts to broker a formal cease-fire by Palestinian militants may at last succeed. Egyptian President Hosni Mubarak and other Arab leaders have signaled an intent to promote a settlement more actively than before. Remarkably, Mr. Mubarak launched a frontal attack on the Arab world's conventional wisdom by publicly endorsing Mr. Sharon's "ability to move along the peace process."
The Bush administration, too, has revived its long-dormant diplomacy, dispatching Secretary of State Colin L. Powell and other senior officials to the region and releasing a token $20 million in aid to the Palestinian Authority. But the administration's engagement remains modest, compared with both the size and the perishability of the opportunity. In his public statements, President Bush has stressed the development of a genuine Palestinian democracy as a precondition to progress toward the two-state settlement he has endorsed. That focus on shaping the course of Palestinian politics after Arafat is sensible -- but it should not serve as an excuse for Israel and the United States to postpone steps of their own.
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In the short term, Mr. Sharon is pushing ahead with his own plan to withdraw Israeli troops and settlers from the Gaza Strip by late next year. If successful, this initiative could facilitate a broader settlement, particularly as Mr. Sharon has precipitated a crucial battle within Israel between a pro-pullout majority and die-hard supporters of Jewish settlements in Gaza. But Mr. Sharon's long-term aim remains a unilateral redrawing of Israel's border through the construction of a security fence, the expansion and de facto annexation of many West Bank settlements, and the indefinite postponement of a final peace.
In the coming months the Israeli leader will claim, with some justification, to be taking painful steps forward, when they relate to his own ambitions. The question is whether he can be induced to take other actions in keeping with Mr. Bush's goal of a two-state solution. In the near term, these include the dismantling of checkpoints and illegal settlement outposts in the West Bank, the release of some Palestinian prisoners and, in the event of a Palestinian cease-fire, a suspension of Israeli attacks on Palestinian militants. If Palestinians elect a pro-peace leadership, Mr. Sharon ought to be willing to open negotiations on a handover in Gaza, and renew final settlement discussions.
Mr. Bush must contend with unrealistic expectations by some European leaders, who imagine that Mr. Arafat's passing makes possible a quick leap to a Middle East settlement. In fact, even if the moderate Mahmoud Abbas wins the Palestinian election for president, he will need time to consolidate his position, rebuild the Palestinian Authority and lay the political groundwork for making the concessions needed for a final accord. Mr. Sharon will be busy with Gaza at least until next summer. But if the foundation is to be laid for peace, concerted American action should begin now. Palestinian political, economic and security reforms cannot be delegated to Egypt and the World Bank, Arab governments must be cajoled at a high level, and Mr. Sharon should not be left free to pursue his own agenda. The United States must return to leading the Middle East peace process. So far, it has not.