Rice Says 2-state Solution in Middle East in Jeopardy

U.S. Secretary of State describes narrow window of opportunity to push Israel, Palestinians toward peace.

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U.S. Secretary of State Condoleezza Rice said Wednesday that a two-state solution in the Israeli-Palestinian dilemma is in jeopardy and described a narrow window of opportunity to push Israel and the Palestinians toward peace.

In a House of Representatives hearing interrupted by anti-war protesters, Rice said the upcoming peace conference in the United States will give hope to moderate Palestinian forces. She blamed Iran for fanning flames in the region, including what she called troubling new Iranian support for Hamas militants.

"Our concern is growing that without a serious political prospect for the Palestinians that gives to moderate leaders a horizon that they can show to their people that indeed there is a two-state solution that is possible, we will lose the window for a two-state solution," Rice told the House Foreign Affairs Committee.

Rice's testimony was punctuated by Iraq war protesters, including a woman who rushed Rice as she entered the room and waved her hands - painted red to look like blood - in front of the secretary's face. She shouted that Rice was a war criminal and should be taken to The Hague, where the international war tribunal is based.

Rice was stoic and continued with business as usual as the protester was spirited from the room. Other protesters were likewise escorted away at the behest of the committee chairman, Democratic Rep. Tom Lantos.

Despite the protesters' effort to focus on the war, the Israeli-Palestinian conflict and Iran dominated much of the hearing. Sharp questions included ones from Lantos whether the Bush administration was doing enough to pressure Egypt to crack down on Hamas sympathizers and whether Bush was organizing the peace conference to salvage his political legacy.

Rice dismissed suggestions that the conference was a political ploy.

"There are probably easier foreign policy tasks to take on than the Israeli-Palestinian conflict," she said. "The timing comes down to what it is we need to do to give moderate forces in the region a boost and to deal a blow to forces of extremism."

"The conference has not been scheduled, but should happen by the end of the year," she said.

She also said the United States will ask Congress for more money to support the Palestinian government. She did not disclose the amount.

On a separate issue, Rice said an emergency State Department review found serious problems with the way private security guards operate in Iraq and that more changes to government policy for contractors may be needed.

Rice said she and Defense Secretary Robert Gates have told their No. 2 officials to study further. Rice already has ordered two rounds of changes to the rules for security contractors intended to install greater oversight from Washington.

On Iran, Rice said the administration shares Congress' goal of imposing tougher sanctions. But a multilateral approach is necessary, she said, and urged lawmakers to work with the administration.

Last month, the House passed, by a 397-16 vote, legislation aimed at blocking foreign investment in Iran, in particular its lucrative energy sector. The bill, sponsored by Lantos, specifically would bar the president from waiving U.S. sanctions.

When asked whether the administration is considering a military strike in Iran, and if Vice President Dick Cheney was leading the charge, Rice said the administration - including Cheney - is committed to a diplomatic approach but would not take any of its options off the table.

Rice said sanctions imposed by the international community, and companies voluntarily refusing to invest in Iran is the best bet.

"Frankly, the international community has to get a lot tougher if it's going to get resolved diplomatically," she said. "The Iranians are not a state, I don't think, that will change their behavior just through talking to them."

On Iranian ties to Hamas, Rice said it was a disturbing new trend.

"To see Iranian actual penetration now of these more radical elements of the Palestinian terrorist groups is really quite troubling," she said.

On other issues: Rice said the Iraqis are taking steps to crack down on fighters of the Kurdish Workers Party, or PKK, in Iraq, including closing PKK offices, stopping the movement of party members and dispatching a senior delegation to Turkey. The U.S. has told Turkey that retaliatory attacks would have a destabilizing effect, she said.

Rice urged lawmakers not to pursue a resolution that would label as genocide the killings of Armenians by Ottoman Turks a century ago because of delicate relations with Turkey. This is something that was a horrible event, in the mass killings that took place, but at the time of the Ottoman Empire. "These are not the Ottomans," she said of Turkey's current government. Rice said the U.S. Embassy in Iraq will be completed within budget, at a price tag of $592 million, and that construction delays were being dealt with. She refused to estimate when it would be finished.

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