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Insider : U.S. Walks Fine Line, Hopes to Say Goodby to Hard Line : It's no secret the White House would prefer to deal with Yitzhak Rabin and get its Mideast policy back on track.


WASHINGTON — Perhaps the most secret task in the Bush Administration these days is icing down the champagne for use if Prime Minister Yitzhak Shamir loses Israel's June 23 election.

Preparations for celebration must be done clandestinely because President Bush and Secretary of State James A. Baker III want to keep up the appearance of neutrality--even though it is no secret that they believe Shamir has frustrated U.S. Middle East policy with his determined construction of Jewish settlements in the occupied West Bank and Gaza Strip and other hard-line activities.

The White House worries that openly supporting Shamir's opponent, Yitzhak Rabin, could backfire by arousing nationalist sentiment and pushing some Israelis into Shamir's camp. And it doesn't want to risk alienating the American Jewish community, either, by appearing to interfere in Israel's domestic affairs.

Although Administration officials insist that U.S. backing for Israel's security is unshaken, there can be little doubt that Washington believes it would be easier to show that support to a new government. Some of Israel's staunchest American backers are saying that U.S.-Israel relations are worse now than at any time since the 1956 Suez Canal crisis.

But when an American official was asked about contingency planning for dealing with a post-Shamir government, he recoiled. "Come on," he said, "you know I can't talk about that even off the record."

Nonetheless, non-government experts in Middle East policy predict a quick thaw in U.S.-Israeli relations if the Labor Party's Rabin becomes the new prime minister, especially if he can do so without having to include Shamir's Likud Party in a coalition government.

"The United States will try to get Rabin to make a statement that for the coming year or so, Israel will build no new settlements," said William B. Quandt, a former National Security Council expert. "With that kind of statement, the Administration would very quickly respond by saying they are ready to resume talk about (Israel's request for $10 billion in) loan guarantees."

Of course, an Administration gesture toward Israel would not be totally altruistic.

When Bush and Baker rejected Israel's request for the loan guarantees to help resettle Jewish immigrants from the former Soviet Union, the President's popularity in the U.S. Jewish community plummeted. Facing a bruising November election contest of his own, Bush clearly would like to improve his standing with Jewish voters, even if only by a little bit.

Martin Indyk, executive director of the Washington Institute for Near East Policy, said Bush cannot afford to write off the Jewish vote, especially in a three-way race that includes independent Ross Perot.

"There will be competition for Jewish votes, and that will improve relations with Israel" regardless of the outcome of the Israeli election, Indyk said.

Under Israel's complicated political system, the party winning the most votes June 23 will have to seek the support of several other parties to establish a majority coalition. So, the policies of the next government will depend, at least in part, on the ideology of the parties that join the coalition.

Nevertheless, if Rabin emerges as prime minister, he can be expected to follow practices much more in tune with Washington's effort to broker an Arab-Israeli settlement. That proposal would require Israel, in exchange for a stable peace, to withdraw from at least part of the West Bank and Gaza territories that it has occupied since 1967.

While there can be little doubt about the sympathies of the United States, there is no similarly unified view in the Arab world. Arab leaders who want to make peace with Israel probably would rather negotiate with Rabin. But many Arabs would be secretly pleased if Shamir won because then they would be under less pressure to reach an agreement with Israel.

"If Rabin (wins and) is prepared to open the door for a territorial compromise, then the United States will be in a much stronger position to be hard-nosed with the Arabs," said Geoffrey Kemp, another former National Security Council expert who is now a scholar at the Carnegie Endowment for International Peace in Washington.

"The Administration could say, 'Take this opportunity or it will not come again, and we will not hold your hand if you let this slip by.' "

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