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He says he's not sad, only very concerned. Concerned in the deep sense of the word. Within four or five years, the Middle East will be nuclearized, and it turns out that the peace process is not what we thought it was. It turns out that the Palestinian partner is not what we thought he was. And the national unity government is paralyzed, doing nothing and capable of doing nothing. The left refuses to engage in any intellectual stocktaking; the right refuses to move toward any sort of solution. In the meantime, within this vacuum, Yasser Arafat is hurtling us back into the 1970s, and Ariel Sharon into the 1950s. Even here, in Kfar Sava, you can hear shooting at night. Every night, for nearly the whole night, you can hear shooting from the yard .

Shlomo Ben-Ami is also not particularly happy. In Jerusalem, Alik Ron, the former Northern District police chief, has just completed his testimony to the commission of inquiry investigating the police reaction to last October's riots in Arab villages, when 13 of the demonstrators were shot dead. Then the television news shows footage of the Labor Party primaries, in which Ben-Ami himself did not participate. Even when the telephone rings, and the European Union's Javier Solana is on the line - he gets advice in fluent Spanish about some sort of idea that may perhaps advance some sort of understanding - you can't get over the feeling that Shlomo Ben-Ami is very much immersed in his own thoughts and reflections. And with his stocktaking.

With the help of a hefty pile of documents that he brings in from the next room, he tries to explain what actually happened here. What went wrong. The summer shirt he's wearing is from Camp David, a kind of American summer-camp shirt from a summer camp that wasn't much of a success.

But Ben-Ami, who was Ehud Barak's representative to the peace talks, claims again and again that Camp David is not the crucial thing; that anyone who chooses to focus on Camp David hasn't got a clue. Those two weeks in Maryland, which riveted the world's attention, are only one piece of the puzzle.

Ben-Ami's charm hasn't faded. At some remove from the high tension of power, he is relaxed and smiling, with a captivating sense of humor. His analyses are deep and complex. His contexts are multilingual and multicultural. When he places his reading glasses on the tip of his nose and starts to read from the diary he kept in those fateful days, he seems to be trying to understand.

Shlomo Ben-Ami, what were the assumptions that guided you and the prime minister, Ehud Barak, when you set out, in the spring of 2000, to terminate the Israeli-Palestinian conflict?

"We had a number of working assumptions, but I think the most important of them was the basic assumption that has been shared by the Americans, the Europeans and the Israeli center-left for years: that Oslo created a rational order in the Middle East based on give-and-take, which in the future would lead to an acceptable compromise; that in 1993 a quasi-state of the Palestinians was established, in terms of orderly international relations. In retrospect, this turned out to be a mistaken assumption, It turned out that for [Palestinian leader Yasser] Arafat it was a huge camouflage net behind which he fomented, and continues to foment, political pressure and terrorism in different dosages in order to undermine the very idea of two states for two nations."

Let's go back to the beginning - to your first talks with Barak when he placed you in charge of the negotiations. What kind of territorial compromise did you have in mind then?

"In one of our first meetings, Barak showed me a map that included the Jordan Rift Valley and was a kind of very beefed-up Allon Plan [formulated by Yigal Allon in the 1970s and based on a territorial compromise]. He was proud of the fact that his map would leave Israel with about a third of the territory. If I remember right, he gave the Palestinians only 66 percent of the land. Ehud was convinced that the map was extremely logical. He had a kind of patronizing, wishful-thinking, naive approach, telling me enthusiastically, `Look, this is a state; to all intents and purposes it looks like a state.'

"At that point, I didn't argue with him. I didn't tell him to throw the map into the garbage or to turn it into a kite. But later, in the wake of advance talks with the Palestinians and internal clarifications, he understood that it was impossible to present a map like that publicly."

What did you go into the negotiations with, then? What was the official Israeli position that you and Gilad Sher presented to the Palestinians in Stockholm in May 2000?

"At Stockholm we placed a map [with a ratio] of 12-88 on the table. We demanded three settlement blocs [Etzion, Ariel, the Jerusalem area] and a security hold in the Jordan Rift Valley for about 20 years. According to the map we presented, the Jordan River line itself would remain under Israeli sovereignty in order to prevent the entry of weapons and to forestall any violation of the demilitarization arrangements. At Stockholm we also objected to the idea of an exchange of territory. Our concept was that the West Bank and the Gaza Strip were the sand table within which all the problems had to be resolved."

How did the Palestinians react to this?

"They didn't like looking at our maps. Abu Ala would tell me, `Shlomo, take the map away.' In [private] talks, he would press me: What percentage do you really mean? But in the guest house of the prime minister of Sweden, with that marvelous view, and on the edge of a lake too beautiful to describe, we had the best talks we ever had. The surroundings were tranquil, the atmosphere was right, the approach was pragmatic. So much so that we constructed a written framework for an agreement, and we even entered into consultations with experts in international law on the correct legal construction of the agreement. Our assessment was that we were truly on the way to an Israeli-Palestinian peace agreement."

What agreements did you reach there?

"The term agreements is too binding. Nothing was concluded. But there was understanding about the need for settlement blocs and there was understanding that in connection with security, the Palestinians would be flexible. On the subject of the refugees we constructed an entire concept that was based on a solution in Arab host-states, in the Palestinian state, in countries like Canada and Australia, and on family reunification in Israel. In Stockholm we talked about 10 or 15 thousand refugees who would be absorbed in Israel over a period of years.

"Abu Ala and Hasan Asfour didn't accept those figures, but they showed readiness to enter into substantive talks and to discuss numbers. On the territorial issue, too, the feeling was that they would meet us halfway. In a conversation we had after Stockholm, at the Holiday Inn in Jerusalem, Abu Ala agreed explicitly to 4 percent [remaining in Israel's hands]. So the feeling was that [an agreement] was really within reach."

And Jerusalem?

"Jerusalem was not discussed at all. Barak wasn't willing. I think that was a mistake. If we had discussed Jerusalem, we would have come to Camp David better prepared. But he was afraid of leaks and also that the very discussion of Jerusalem would destabilize the government and put the coalition at risk. So in the drafts we prepared, the Jerusalem clause remained a blank page. Even that upset him. You can see a comment in his handwriting on the documents we drew up in May: Barak preferred that even the heading of the Jerusalem clause not appear in print."

What direction did the process take in the wake of the Stockholm talks and ahead of Camp David? If I had asked you in June or July 2000 what might be agreed upon, what would you have said?

"Officially, we didn't budge at that stage from the 12-88 map of Stockholm and from the principle that there would be no exchange of territories. But in one-on-one conversations, I talked about 8 to 10 percent [remaining under Israeli control]. As I told you, Abu Ala mentioned 4 percent to me. To the best of my knowledge, ahead of Camp David [U.S. president Bill] Clinton received from the Palestinians a pledge of 2 percent. So it could be assumed that we would go beyond 90 percent and the Palestinians would go beyond 4 percent and we would meet at some point in the middle. On the territorial issue, Clinton could have said that the sides were not agreed on quantity, but agreed on the principle.

"What became clear during the talks immediately after Stockholm was that the Palestinians would show a certain flexibility concerning the settlement blocs, but they were adamant on the eastern border and the Jordan Rift Valley. They demanded a solution for the Jordan River border, and at that stage we weren't willing to give them a guarantee of that."

And what about Jerusalem and the refugees?

"There were no detailed talks at all about Jerusalem. The only thing was a promise that Arafat gave us, in a talk in Nablus, that the Western Wall and the Jewish Quarter were ours. He talked at length about how he remembered himself playing with Jewish children by the Western Wall in the 1930s, so he knows that the Wall is ours. Some of the other Palestinians mentioned Gilo several times, in a way that implied that they accepted the Jewish neighborhoods in the eastern part of the city.

"But on the question of the refugees, there was something of a regression in the period between Stockholm and Camp David. Abu Mazen persuaded Abu Ala not to get into any discussion of numbers, but to stick with the principle of the right of return. After our meetings, Abu Ala brought the joint document of Abu Ala and Yossi Beilin and showed me how many reservations Abu Mazen himself had about that document, especially in regard to the refugees.

"By the way, not only Abu Mazen but Arafat too had reservations about the document. When I asked Arafat about it in a talk we held in Gaza a few months later, he replied contemptuously: `Words, words.'"

What were Israel's opening positions at the Camp David meeting in mid-July? What was the official Israeli position at the peace summit?

"The map I placed on the table at Camp David for the Palestinian team to peruse, in the presence of President Clinton, was the 12-88 map. Between Stockholm [May 2000] and Taba [January 2001] we did not officially present any other map to the Palestinians. We didn't agree to pare down our official stand unless there was movement on their part, and because there was no movement on their part, we didn't present new maps.

"But unofficially, it was clear that we were ready for 8 to 10 percent. We still objected to a territorial exchange. We still demanded that Jerusalem remain united under our sovereignty.

"The Palestinians, in contrast, insisted that the discussion open with a recognition by Israel of the 1967 lines. They were very rigid on that point. I will never forget a discussion in the presence of President Clinton and [secretary of state] Madeleine Albright and [national security adviser] Sandy Berger in which I suggested that we enter into a discussion on the basis of the hypothesis of the 1967 borders, but without committing ourselves to them. Abu Ala vehemently refused to enter into that dynamic. He insisted that we first of all recognize the borders of June 4, 1967.

"After a time, Clinton became boiling mad and started shouting terribly. He told Abu Ala that this wasn't a speech at the United Nations, and that the Palestinians had to come up with positive proposals of their own. Clinton shouted that no one would be able to get everything he wanted and that he too would like to serve a third term as president, but he knew that was impossible. He turned completely red and finally got up and stalked out. Abu Ala was deeply offended. From that moment, almost the only thing he did at Camp David was drive around the lawns in a golf cart."

Didn't the Palestinians make a counterproposal?

"No. And that is the heart of the matter. Never, in the negotiations between us and the Palestinians, was there a Palestinian counterproposal. There never was and there never will be. So the Israeli negotiator always finds himself in a dilemma: Either I get up and walk out because these guys aren't ready to put forward proposals of their own, or I make another concession. In the end, even the most moderate negotiator reaches a point where he understands that there is no end to it."

Was there ever a moment when things seemed to be otherwise? When it seemed that some sort of breakthrough might be achieved at Camp David?

"When the feeling was that we were treading water, the president organized a simulation game that went on for a whole night, until noon the next day. The key to the game was that it did not obligate the leaders. The participants were Gilad Sher, Yisrael Hasson and myself, against Saeb Erekat, Mohammed Dahlan and a Palestinian lawyer from Oxford.

"In this game, for the first time, we put forward a proposal about Jerusalem. The proposal was that the outer envelope of Arab neighborhoods in the city would be under Palestinian sovereignty, the inner envelope would be under functional autonomy, the Old City under a special regime, and the Temple Mount under a perpetual Palestinian trusteeship. Clinton was very pleased with our proposal. Ehud also thought we had taken a courageous step - that was before he made his own courageous decisions - and it was a form of a breakthrough that extricated the process from its impasse."

What was the Palestinian reaction?

"Disappointing. The lawyer from Oxford said that they would demand compensation for all the years of the occupation. Saeb Erekat also spoke along the same lines in the presence of Clinton. I couldn't restrain myself and I burst out. I told them that the negotiators on behalf of the Zionist movement on the eve of the establishment of the Jewish state didn't behave as nonchalantly [as the Palestinians at Camp David]. I asked them which of the sides here wanted to establish a state - us or them. I felt terribly frustrated that we were making such a creative, flexible move and reaching one of the finest moments of the negotiations, and they couldn't free themselves from their gibes, from the need for vindication, from their victimization.

"Still, things continued positively. Clinton went to Arafat and held a very tough talk with him. And then, when Arafat found himself in hardship and felt that he was on the edge of a precipice, he finally made a kind of counterproposal. He told Clinton that he was ready to forgo between 8 and 10 percent of the territory."

Are you saying that on July 16, 2000, in a conversation with Clinton, Yasser Arafat agreed to give Israel about a tenth of the West Bank?

"I am quoting to you from what I recorded in my diary on July 17: `Yesterday Arafat made a proposal to Clinton in relation to the scenario of the previous night. He is ready to give territory of between 8 and 10 percent. He told Clinton: 'I leave the matter of the [territorial] swap in your hands, you decide.' He is ready for security arrangements as will be decided. He places the emphasis on an international force. We will find a solution on the refugee issue, too. Everything now stands or falls over Jerusalem. Arafat wants a solution there that he can live with."

Is this the origin of the Camp David formula for a territorial exchange: 9 percent of the territories in return for 1 percent of sovereign Israeli territory?

"That formulation was never crystallized in a binding document. But from the beginning of the second week at Camp David, it was in the air. It was our working assumption. And it was based on what Arafat had said. Not on some canton scheme of Israel's, but on explicit remarks by Arafat. I remember that on the 17th, I went to Ehud's cabin and I ran into Clinton, who was just coming out of the cabin, and he told me the same: that Arafat's message is readiness for 8 percent with a token territorial swap in the Gaza Strip.

"In other talks that day, Clinton said that `the Israelis did something precedent-setting, and there was genuine and essential movement here to get to 80 percent of the settlers and a united Jerusalem under Israeli sovereignty.' His impression was that the whole package was beginning to fall into place. But some time later Arafat retracted. He conveyed a note to Clinton in which he retracted."

Isn't it possible that what Arafat did was to brilliantly maneuver the Israeli side into breaking the great taboo of Jerusalem, by creating the false impression that if you would only make a concession on Jerusalem, everything else would be easily resolved and an agreement could be signed?

"I don't know. I wouldn't be surprised if what he wanted at that moment was simply to extricate himself from the plight he was in because of the flexibility we showed and the American pressure on him. So he said a few words to Clinton, which was no big deal from his point of view. You know, when he went with us to Sharm al-Sheikh and promised to stop the shooting, he also said a few words. But did he actually stop the shooting?"

Still, in the wake of this dynamic, the Camp David conference became the Jerusalem conference. Isn't it the case that you didn't reach a binding territorial agreement, you didn't formulate a solution for the refugee question, all you did was divide Jerusalem?

"That is not completely accurate. It's true that there was a regression at Camp David on the question of the refugees, but the feeling was that there was flexibility on the territorial issue - that the peace would not stand or fall on this issue. And in the security group, there were very positive discussions that advanced the process. The concept of a multinational force was crystallized. I also do not accept the argument that we divided the city at Camp David. The decision on the division of Jerusalem came only with the acceptance of Clinton's parameters five months later.

"You have to understand one thing: we at Camp David were moving toward a division in practice but with the aspiration of reaching an agreement that didn't look like a division. The big problem there was that the Palestinians weren't willing to help us with that. They weren't ready for any face-saving formulation for the Israelis. Not on the issue of the Temple Mount, not on sovereignty, not on anything. Arafat did not agree to anything that was not a complete division at Camp David. Therefore, even Bob Malley, whom everyone now likes to quote, told me at some stage that the Palestinians simply want to humiliate us. `They want to humiliate you' were his words." [The reference is to an article by Hussein Agha and Robert Malley - a member of the U.S. peace team and a special assistant to President Clinton - "Camp David: The Tragedy of Errors," The New York Review of Books, August 9, 2001.]

I understand that there was a stage at which Barak astonished everyone by agreeing to divide the Old City of Jerusalem into two quarters under Israeli sovereignty and two quarters under Palestinian sovereignty. Did he do that on his own or was it a joint decision made by the entire Israeli team?

"As I told you, I suggested that a special regime be introduced in the Old City. In the wake of that discussion, some time later, the president put forward a two-two proposal, meaning a clear division of sovereignty. In a conversation with the president, Ehud agreed that that would be a basis for discussion. I remember walking in the fields with Martin Indyk [of the State Department] that night and both of us saying that Ehud was nuts. We didn't understand how he could even have thought of agreeing. Afterward I wrote in my diary that everyone thinks that Amnon [Lipkin-] Shahak and I are pushing Barak to the left, but the truth is that he was the one who pushed us leftward. At that stage - this was the start of the second week of the meeting - he was far more courageous than we were. Truly courageous. Clinton told me a few times: I have never met such a courageous person."

So where did all this lead?

"The Palestinians did not accept the president's proposal on Jerusalem, and therefore Ehud also retracted his agreement. At this point, he sent an angry letter to Clinton in which he claimed that the president was not putting enough pressure on Arafat. Sometime later, Clinton tried again. I have a note in his handwriting in which he asks me if I am ready to put forward Barak's acceptance of that principle again. I replied in the negative. That proposal is off the agenda, I said.

"The result was a deep crisis that almost led to the collapse of the conference before Clinton's trip to Japan. Barak started to feel that he didn't have a partner. That he was going farther than any other Israeli prime minister and risking himself politically and losing his government, but despite that, Arafat would not budge. Arafat refused to get into the game.

"It was very difficult for Ehud. Very difficult. After we decided to stay on despite everything, and after Clinton left, Barak went into two days of isolation in his cabin. None of us saw him for two days. He was in deep depression."

After Clinton returned and the conference resumed, what was the focus in the last few days?

"In the final analysis, what was on the table toward the end of the conference was the president's proposal on the outer envelope under Palestinian sovereignty and the Temple Mount under Israeli sovereignty but under a Palestinian trusteeship. Apart from that, there were two variants: functional autonomy in the inner neighborhoods and two quarters in the Old City under Palestinian sovereignty, or Palestinian sovereignty in the inner neighborhoods and functional autonomy in the Old City. There was also a third possibility, of postponing the discussion on Jerusalem for three years.

"It was the last night. It was late. I remember that before I left for Clinton's cabin, Ehud took me aside and said this was a historic moment. Over and over, he said it was a historic moment. Clinton was in jeans and a light sweater and he sat with Erekat and me for a while around the wooden table, until he asked me, finally, whether we were ready to accept his proposal. I told him that for a change, I was not going to comment until the Palestinians replied. After Barak had given a positive reply to the two-two idea and the Palestinians had evaded the issue, we weren't going to place ourselves in the same situation again.

"The president thought that was fair and he didn't press me, but sent Erekat to Arafat. He told him explicitly that if the chairman did not accept the proposal, he must present a counterproposal. He promised that if there was a counterproposal, he himself would stay and the conference would continue.

"I was the only Israeli in the room. There wasn't a good feeling. Clinton was pretty pessimistic by this time. An hour later, Erekat came back and said no. I think he also brought something in writing. I took my leave of the president and went back to Ehud. That's it, I told him, it's over."