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Toward the end of the interview with Shimon Peres, his spokeswoman, Ayelet Frish, reminded the president (from now on, no more "Shimon") that he should say something festive for the new year. This is his first holiday interview as president: What might he have to say at this stage? That he wishes everyone a year of peace and security? That is should be a year of happiness and prosperity? That the unity of the nation should be preserved? That is not his style.

"Obviously," the president said, slowing to dictation-friendly speed, "a singular opportunity to advance the peace process has appeared, and we must not miss it. This window of opportunity that has opened to us is made of glass and must be handled with care. We must not throw stones at it. If we see ourselves as pure as the driven snow, and the others as chimney sweeps, then we will not get anywhere. If we lead, we will not be led. I don't accept the argument that Abu Mazen [Palestinian Authority Chairman Mahmoud Abbas] is weak. The division between the Gaza Strip and the West Bank has strengthened him and Prime Minister Salam Fayad. There is someone to talk to, but we must be very careful that the talks don't turn into empty words. It is better to be a lion in sheep's clothing than to be a sheep that roars like a lion."

That is the most festive and most statesmanlike message that Peres was able to squeeze out. He turned 84 last month, and he has plans for the next 10 years. He has no time for nonsense and no patience for nudniks. A new Middle East? That's passe. Peres is contending with a new world, with globalization. He is worried by a leadership crisis that is affecting the entire world and above all the United States. "A nation of 300 million people, and look who their [presidential] candidates are," he says unpresidentially, adding, "Leaders are hard to find. When [French President Nicolas] Sarkozy was elected, too, everyone turned up their noses."

They all listen to me

A few hours after the Knesset elected him Israel's ninth president, one of his aides sighed and said, "At last, Shimon is a winner, but in two months he'll be asking himself why he needed this headache." Another close aide reassured his colleague: "Don't worry, Shimon is a champ at arranging reality to suit his current needs."

New arrangements in the presidential offices prior to the arrival of their new tenant may offer a hint of Peres' intentions. His desk was moved to the front of the room, facing the door, so that Peres can get a look at his visitors as they approach. And in a departure from previous interviews, a bodyguard entered the office itself and took his place in the corner.

When you were considering entering the presidential race, you told a friend from abroad who tried to convince you to run that Peres [a species of vulture in Hebrew] is a bird and that birds don't like cages, even gilded ones. Do you feel as if you've entered a gilded cage?

"I discovered that the President's Residence offers nearly unlimited airspace. Instead of flying low you can soar. I can get involved in anything. The person who has power doesn't have force, and the person who has force doesn't need to have power. What does a cabinet minister or a CEO do? Most of the time they prevent or resolve friction. I don't have to manage anything. Instead of managing, I engage informal organizations on behalf of the issues I see as the most important ones.

"A government has a budget, but it does not have money. It has an army and a police force but they are tied to the past and less relevant to the problems facing the world now. Today everything is global: the war on terror, global warming, investments, the media. In all these areas, countries must cooperate with one another. The world does not rest on its laurels. From the President's Residence, I can obtain more money than the government can, for goals such as the Peace Valley [Peres' proposal for joint Israeli-Palestinian-Jordanian projects along 520 kilometers of the Israel-Jordan border], the Mediterranean Youth Technology Club or retrofitting gasoline-engine vehicles with battery-powered engines. From here, I can change the relationship between the Jewish people and Israel, so that we focus on intellectual cooperation instead of fundraising. Of course I am aided by existing organizations, but they all listen to me."

Many people who are much younger than you are anticipating retirement in order to spend time with their grandchildren, and you're talking about new plans?

"Don't kid yourself. The grandchildren are not so interested in playing with you. You get up in the morning and play with the grandkids for what, half an hour, an hour? The children come here more, and there are more people who want to schedule an appointment than ever before. In life, you don't get all your desires fulfilled. You make compromises."

Have you ever, just for the fun, sat on the beach in a bathing suit?

"Many years ago, when the children were small. I see people on vacation and I don't envy them. I ask myself, what do they do on vacation? For me, work is pleasure. I have a limited number of abilities and limited time. I believe I have the ability to make an above-average contribution and I do so willingly."

Don't you waste your precious time at boring ceremonies and receptions? "In every position I ever had there were celebrations. Here there are perhaps more speeches, but fewer speakers. I have more leisure to think and also to read and to write and to express myself in an orderly fashion. I finished writing a book that will be called "Izruah Hashalom" ["the civilianization of peace"]. The idea is that war unifies a nation, whereas peace divides it because it gives rise to arguments about the price. I argue that unless global factors are included, such as economic, ecological and standard-of-living issues, it is very difficult to make peace. Everything that has happened since World War II was accomplished using the economic engine, not tanks or the top hats of the diplomats. Jean Monnet - considered the architect of the European Union - is more important to the future of Europe than Napoleon. Napoleon left graves behind him, whereas Monnet, even though it is less dramatic, restored the ruins for the sake of the future."

There is a joke about you: From a piece of cloth that would barely be sufficient for two sleeves anywhere else in the world, your tailor in Tel Aviv can cut a whole suit. You ask how he does it and he says: "Mr. Peres, abroad you are a giant."

"I read that somewhere. I've been controversial for most of my life. Suddenly I've become popular. I don't know when I was wrong, then or now."

A real "Israeli Idol." By the way, have you ever seen the program? What is your opinion of this social phenomenon?

"I glance at it occasionally. I don't have much patience for television. I belong to the generation of the book. But what's wrong with people liking 'A Star Is Born' [the English translation of the local 'Idol' franchise]? What's so bad about a farmboy winning a song contest? It's people's only chance to break out and escape from anonymity.

"The world has undergone a total change; Israel is changing too, and I don't think for the worse. I asked a famous American producer why they make films on such a level, and he responded frankly: 'We adapt our selves to the taste of the majority.' America is an empire of celluloid. What happens in Hollywood? Stars are born. That is the American dream. One of the things that always surprises me is when I see a movie star on screen and he seems tall and clever, and when I meet him, I find a short man whom I wouldn't otherwise have noticed.

Hamas is losing its grip

Let's move on to real life. It seems that since becoming president you have not lost your compulsion to be involved in statesmanship.

"I am not planning to join any party or to do anything that smacks of partisanship. But if I believe that in order to save Israel we must achieve peace, and not merely security, then I have an obligation to deflect danger from the state of which I am a citizen. Is that interfering in politics? The position that obtained a majority [in the elections] was the one that supports two states, and that is a real revolution. I also respect the position of the minority, which opposes that, but respect does not make me thoughtless. I cannot represent both the majority and the minority because that would mean that I do not exist in the State of Israel at all, that I have no position. I did not move to the UN, I moved to the President's Residence."

Are you planning to help Prime Minister Ehud Olmert sell the agreement of principles with the Palestinians, and perhaps even to draft it?

"I assume that my voice is heard and that I am respected, and therefore it is my duty to do everything possible to persuade the nation to support peace. The prime minister has said he wants me to contribute my experience and I am sure he meant that. It is important not to create the impression that there are two governments, here and in the cabinet, and to maintain harmony both inside and outside. In a situation of harmony, I can have more influence than in a situation of disagreement."

Because of your desire to maintain harmony, you lent a hand to the destruction of the Palestinian Authority, the policy of "no partner" [in dialogue] and unilateral measures as an alternative to dialogue.

"I did not support that. I declared my opposition and said it was a mistake. I did not stay silent, but I was in the minority. What could I do? It is easier to be absolutist, but sooner or later you find yourself beyond the consensus. It was not that I joined Arik [former prime minister Ariel Sharon]. He joined the ideas that I supported. I had a certain amount of influence on him and I had a part in his support for a two-state solution. The agreement of the right under Sharon to a two-state solution and the evacuation of the settlers from the Gaza Strip was courageous and extremely significant. I told him it was preferable to [withdraw from Gaza] by means of a dialogue with the Palestinians, but if the choice was between remaining in Gaza because there was no dialogue, or leaving even though there was no dialogue, it is clear that I preferred the latter."

Does the Olmert government have sufficient political courage to evacuate tens of thousands of settlers from the West Bank?

"I would not choose a route of clashes with the settlers. Perhaps there is a possibility that we have not yet examined, beyond the idea of transferring the settlers to three settlement blocs."

Do you have a solution to the issue of the [Palestinian refugees'] right of return?

"We do not disagree on the point that there is no solution for this issue, either factual or semantic. When the disagreement over self-determination for the Palestinians surfaced at Camp David I [1978], Prof. Aharon Barak, who was attorney general at the time, found a solution. [Egyptian President Anwar] Sadat told [Israeli prime minister Menachem] Begin that if he were more generous with his declarations, Egypt would respond to each generous step with 10 steps. The Palestinians understand that Israel was not going to commit suicide for them and would not open its gates to millions of refugees. I am convinced it will be possible to overcome that."

Can Israeli public support also be obtained for conceding Israeli sovereignty over the Temple Mount?

"If the leadership shows courage, determination and creativity, the public can be united around a peace agreement that will also include concessions over arrangements on the Temple Mount. Menachem Begin, and I say this to his credit, promised he would go to live in [the settlement of] Neot Sinai and that he would never forgo all of Sinai, but in the end he signed a peace treaty with Egypt, against the Likud's wishes. The party was split, but at the end of the day they all supported his policy.

"I believe that the strength of the agreement creates strength. Who dreamed that Arik Sharon would be in favor of a Palestinian state? The reality, the vision and the responsibility have their own effects. The difference between war and peace is that in war you prevent death whereas in peace you make life possible. There is no life without compromises. That is true between couples and in international relations. It requires no less courage to make peace than to go to war."

Is there any point to an agreement without Hamas?

"Hamas is the tail that wags the dog. It is the one that prevented peace. I am not at all convinced that it wants a Palestinian state, and not merely hegemony. What logic is there to firing Qassam rockets [into Israel], when not a single Israeli remains in Gaza, and we have not cut off their water and electricity supplies?"

What do you suggest doing about the Qassams [Peres was criticized for scornfully referring to the missiles as "Shmassams"]?

"There is a competition here over staying power, not just over ability to withstand suffering. I would try to show as much staying power as possible because I'm starting to sense that Hamas is losing its hold in the Gaza Strip. In the end, people in Gaza will ask, what are you doing to us? You are turning our nights to darkness and making our children hungry and isolating Gaza. Where are you heading? They are starting to clash with reality. Apart from that, the Israel Defense Forces have improved in the past few weeks and are better able to hit their targets, and soon the effects of technology will also be felt."

Are you satisfied with the marginal role being played by the Bush administration in the peace process?

"In the diplomatic lane, unlike the economic one, there is no place for foreign eyes. The prime minister must check constantly what is happening at home so as to keep his coalition. The same goes for Abu Mazen. That is why the negotiations must be clandestine, so they don't turn into public wrangling. Had people known about the Oslo [talks] in advance, there would not have been an Oslo [agreement]. Olmert is right to keep his cards close to his chest. He has to deliver the final product to the nation, and not something partial."

Are you hinting that we are secretly negotiating with the Palestinians?

"I assume that we are, and I think that's justified. That is the nature of negotiations. Did anyone know what was happening between Moshe Dayan and [Egyptian vice premier Hassan] Touhami before Sadat's visit to Jerusalem?"

Minor tribal chieftain

The reports about the new tension between Damascus and Jerusalem caught Peres during a visit to Rome that coincided with a visit by Syrian Vice President Farouk Shara to the city. The Italian media entertained rumors about the timing of Peres' visit, suggesting that the two had contact, and Peres did not appear to be suffering overly from the attention.

Peres met with Pope Benedict last Thursday. "He said the main document that should guide all religions is the Ten Commandments, which contains the largest concentration of values. He said he wants to visit Israel and is considering organizing an interfaith meeting here. I told him that Stalin once asked how many divisions the Pope had; today, look where Stalin is, and where the Pope is. Where is Communism and where is the Vatican?"

With regard to Syria, Peres was much less free with his words. He has joined forces with the Israeli "choir of the tight-lipped," and refuses to say anything about the reports of Israel Air Force incursions into Syrian airspace. Speaking by phone from Rome, he agreed only to address Syria's complaint that the Arab world is not showing support for them. "The Arabs realize that their problem is not Israel or America, but rather the combination of Islamic fanaticism of the Ahmadinejad variety with the terrorist organizations and mass destruction."

Heads of government, yourself included, have participated in negotiations with the Syrians, but today Israel refuses to speak with them.

"The problem with Syria is that they work against what they say. The question now on the U.S. agenda is whether Lebanon will fall into Iranian hands. [Syrian President Bashar] Assad supports that and wants the Americans to mediate. To mediate what? To help the Syrians win in Lebanon? We have bitter experience with the Syrians. Three or four prime ministers offered the Syrians everything they wanted but we still did not reach an agreement with them. This makes one doubtful. Perhaps Assad's problem is that he is the head of a small tribe and does not have a majority. It is possible that if he were to say that he is ready to sit down to negotiate, we would meet with him and the situation would be different."

Syria supported the Arab peace initiative proposing negotiations with Israel on the basis of the principle of peace, and normalization in return for a withdrawal from the territories.

"That initiative is like music without an orchestra. The Saudi Arabians played beautiful music but they are not prepared for us to meet with the musicians. I don't disdain the music, it sounds good to my ears and I can live with it."

They say the meeting has a price: Israeli readiness to withdraw from the territories.

"What does that mean? We meet them after peace, after everything is cut and dried? Then there will be no need for meetings. The Arab League's weakness is that it is powerless to influence Iran, Hamas and Hezbollah. I told the secretary of the Arab League, Amr Moussa, 'When you are unable to make peace, what can I say to the suspicious Israeli public, and correctly?'"

How can the Iranian threat be addressed?

"Israel must not jump the line. The Iranians are counting on dissent in the international arena. I am sorry that Europe is moving too slowly on this issue. It is always right, [but] with a two-year delay. In some instances, the world has succeeded in removing military options without military campaigns. Just as in Gaza, in Iran there are internal opponents. They suffer from poverty, from unemployment, from corruption and from dissatisfaction. It is not possible to govern a nation through terrorism and it is not possible to live off of heritage. Without economic measures, you remain behind. Reality is also a factor."