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U.S. Secretary of State Condoleezza Rice arrived in Jerusalem last night at the start of a Middle East trip, and met with Foreign Minister Tzipi Livni. The two discussed ideas for jump starting talks between Israel and the Palestinians that will produce a "diplomatic horizon" and strengthen moderates in the Palestinian Authority.

Livni and Rice, who also discussed threats from extremists in the region - Iran, Hezbollah in Lebanon and Hamas in the territories - agreed that the diplomatic process must be based on the road map, which is acceptable to the Palestinians, Israel and the international community.

Livni said that in addition to the diplomatic horizon, the process should produce "security for Israelis everywhere, in bombarded Sderot as well."

Livni presented Rice Israel's essential security interests, which must be protected under any scenario,. As an example, she said the lack of enforcement of the arms embargo on Hezbollah had negative implications for arms smuggling in Gaza as well.

At a short press briefing Livni and Rice gave after their meeting, they reiterated their commitment to a two-state solution. Livni was asked whether the current government could move ahead diplomatically in light of its political weakness, and she responded that there was no connection, because most Israelis favor a two-state solution.

Rice discussed the Iranian threat and said additional steps were needed in specific countries in to hit the funding of terror and to stop spread of weapons of mass destruction.

The American reporter Andrea Mitchell asked the two women at the end of the briefing whether, as unmarried women without children, they were indifferent to families who had lost sons in Iraq. Rice and Livni both laughed and Rice pointed to Livni and said, "She has children." She then said that, although unmarried, she deeply felt the pain of bereaved families.

Rice met separately with Avigdor Lieberman, the minister of strategic threats, who told her the next conflict with the Palestinians was just a matter of time. If Israel went into the Gaza Strip on a military operation, he said, the result would be the stationing of 30,000 NATO troops in the Strip to keep the quiet.

Defense Minister Amir Peretz and the head of Military Intelligence, Amos Yadlin, also met separately with Rice and discussed Syria, Lebanon and Iran and threats from extremists in the PA. Sources close to PA Chairman Mahmoud Abbas told Haaretz he will ask Rice to persuade the Israeli government to renew talks on a permanent settlement. Abbas is set to meet with Rice this morning at his Muqata headquarters in Ramallah.

Abbas will tell Rice he was greatly disappointed with the outcome of his meeting with Olmert, the sources said. "There was no easing of restrictions on movement by Palestinians at the roadblocks, and the meeting placed Abu Mazen [Abbas] in a ridiculous light to the Palestinian public," a source said. The disappointment was said to be even greater because of the good chemistry between Olmert and Abbas at the meeting. "The visit to Olmert's home only did us damage in the last analysis. The Israeli leadership proved once again that it is not serious in its intensions to help Abbas," the source said.

Haaretz also learned there are hints the Americans do not rule out the beginning of back channel talks. The sources said that following the marketplace of diplomatic initiatives going on in Israel - one day it's Defense Minister Amir Peretz and another day Livni - the Americans are also looking for a better way to move ahead with diplomatic talks. "The U.S. administration feels pressure from the Europeans to come up with a diplomatic initiative and knows that if it wants Arab help on Iraq, it must offer a solution to the Israeli-Palestinian issue."

The Palestinian sources said the moderate Arab countries (Jordan, Egypt and Saudi Arabia) want the Americans to present a clear vision for the end of the conflict - a permanent solution that all parties will have to reach at the end of implementation of the road map.

"If Rice wants to promote the idea of the temporary state, Abu Mazen will refuse. We have had enough of phased solutions. We have to talk about the endgame," a source said.

Abbas made a surprise visit yesterday to Amman, Jordan where he met with King Abdullah to coordinate positions ahead of their meetings with with Rice. No details of the meeting were made public.

PA Prime Minister Ismail Haniyeh called Rice's visit an attempt to promote Israeli and American interests.

"The establishment of a unity government will be based on Palestinian needs, and not American desires," Haniyeh told reporters in Gaza Friday.