The Bush administration should recruit representatives from a wide array of countries to help run postwar Iraq and not rule Iraq alone or solely with U.S. military allies, a Washington think tank asserts in a report to be released today.

A broad-based authority, which should include people from Iraq and neighboring Arab countries, is the best way to win public support and establish the legitimacy of the U.S.-led project to build democracy, said the Washington Institute for Near East Policy. To encourage fresh Iraqi leadership and prevent a concentration of power among Iraqis, two advisory councils should be established, with membership spread widely and considerable responsibility delegated to provincial officials. Chairmanship of the executive council, one of the two bodies, should rotate, the report said.

Iraqis should also lead the reconstruction effort, the better to convince skeptics that the war was not waged for oil, it said. Decisions about international oil companies doing business in Iraq should be made by Iraqis, wrote the authors, Patrick Clawson, David Makovsky and Matthew Levitt.

"America's endeavor in Iraq will ultimately fail if the United States attempts to remake Iraq in its own image," the report said. The United States must make a long-term commitment or risk a setback that would "impede all our other Middle East endeavors for many years to come."

In drafting a report that addresses a range of policy issues in the Middle East, the institute recalled a study it sponsored eight years ago that called leadership change in Iraq the top priority for U.S. policy in the region. This time, with such change well underway, the mission is to win the peace.

The institute's approach, edited by former Middle East negotiator Dennis Ross, contends that authoritarian governments in the region pose a greater threat to U.S. interests than would an effort to spread liberal democracy and free-market economics.

Yet while progress in Iraq will "create a momentum for change in the Middle East" -- a view held by President Bush -- the institute warns that the White House should not plunge into Israeli-Palestinian peacemaking. Bush should be prepared to engage, but his personal participation should be conditioned on concrete steps by Israelis, Palestinians and Arab governments, the report said.

The Palestinians must continue to move away from Yasser Arafat's leadership, the report said, and consolidate political improvements implied by the establishment of the post of prime minister. The government must oppose terrorism, endorse Israel's legitimacy and conduct an open government.

Washington, which contributes billions of dollars to Israel, should press the Israelis to ease Palestinian living conditions, dismantle "illegal, unauthorized settler outposts" and end settlement activity in the West Bank and Gaza.

"In the end," the report argued, "Israel must reach out publicly in a way that credibly demonstrates its intentions toward the Palestinian people" once Palestinians forswear violence and recognize Israel's right to exist.