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January 21, 1998

KING: We're back on LARRY KING LIVE and we welcome a guest who has been with us frequently when he was ambassador, held many posts, when he was out of government office, and now, of course, the prime minister of Israel, Benjamin Netanyahu, who, by the way, has to be caught up in the rest of us in this story of the day.

And you spent some time with the president, were with him late last night, and you yourself have occasionally had the stories come down about Prime Minister Netanyahu. How has the president reacted to all of this?

BENJAMIN NETANYAHU, PRIME MINISTER ISRAEL: He didn't react at all. He was absolutely businesslike. We talked for over three hours in two successive meetings, including one late into the night yesterday. It was right on target, focused, businesslike, very nimble and very creative. I think he's doing his job.

KING: When you visit a country and then something like this happens -- it can happen anywhere to any visiting state of head of state, are you put in kind of a difficult position when a story is breaking that is tabloidish in nature?

NETANYAHU: Well, I didn't know that the story was about to break so we didn't deal with it, but I have to tell you that usually you keep a level head with these things. And my rule in life and in political life in particular, is things are never as good as you think they are and they're never as bad as you might think -- as you might think they are. They're somewhere in the middle.

KING: You have empathy, then?

NETANYAHU: I like President Clinton a lot.

KING: Is that -- when you say a lot, is that closer than it was the last time? I mean, obviously, you had a good week -- you tell me, did you?

NETANYAHU: Well, we had very good talks. I mean, they were very open friendly. They're difficulties. We're trying to bridge them. We're trying to get Arafat to keep his promises to fight terrorism and tear up that covenant. And I've gone through a very serious effort on the part of the Israeli Cabinet to determine which areas we can give up without jeopardizing Israel security so there is a potentially -- a deal out there if Palestinians' expectations are brought into realistic terms.

That's what we were talking about, but I think the president also made an effort to dispel some of the -- I don't know if to call it bad blood that introduced into the relationship because of all sorts of leaks and attributions to him. And he made a point to say that our personal relationship was and should continue to be excellent. And I said, fine. Let's just go.

KING: So, in other words -- by the way, when those stories were appearing, did they concern you that Clinton was very angry with you and your actions and that had affected the friendship of the two countries?

NETANYAHU: Yes, I suppose these things don't help, but you have to understand, I lead a country that is the one single homeland of a very ancient people and the Jewish people have suffered as no other people have suffered in three millenniums of dispersion and pogrom and exile. And now that we've come back to this tiny country that we call our own, it's my responsibility to do what I think is right to safeguard the security of Israel and to bring it a real peace, indefensible peace, so I have that confidence, and I have that deep conviction that it's more powerful than the surface storms that occasionally, inevitably accompany public life.

KING: But America is important to you, right? Very important?

NETANYAHU: It's very important. I have no doubt about the friendship of the United States or its commitment to Israel, but recognize that it is very different to see the Middle East from the banks of the Potomac then from the banks of the Jordan River. It's very different and success of American presidents have had differences with Israeli prime ministers. As in Eisenhower and Ben-Gurion. They forced him out of the Sinai. We sense then, we've had differences between American presidents. We had to come back to the Sinai in '67 to protect ourselves. Ever since then, we've had difference between American presidents and prime ministers.

We had the famous reassessment of Gerald Ford and Henry Kissinger opposing the Yitzhak Shamir. We've had Ronald Reagan and the Manachem Begin on the Lebanon campaign.

KING: What is the biggest different between Netanyahu and Clinton?

NETANYAHU: It's actually peanuts compared to some of the other things like Bush, Baker and Yitzhak Shamir. You remember that?

KING: Peanuts?

NETANYAHU: Yeah, I'll tell you why because I think the level of disagreement is not all that great. The issue is important, not because of the occasional differences of view that we may have. The issue is great because what we're dealing with is of such decisive importance. We're dealing with the heart of the country which is called the West Bank. It's the Judean Sumerian mountain range that is the heart the country that overlooks Telaviv, that overlooks this narrow ribbon 20 miles wide along the coast which is the rest of the Israel.

KING: Let me get...

NETANYAHU: We're not dealing with Sinai as other presidents and prime minister's have done. We're not even dealing with the Golan Heights. We're dealing with Israel's backyard which determines whether we live or we die, so naturally the stakes are very high.

KING: We'll pick right up on that in a moment with the prime minister of Israel, Benjamin Netanyahu after these words.

(COMMERCIAL BREAK)

KING: We're back on LARRY KING LIVE with the Prime Minister of Israel, Benjamin Netanyahu. Anthony Lewis of the "New York Times," often a critic of Israel, had this to say last week, I'd be interested in your comment. "Mr. Netanyahu's actions of late show that he's trying to do two things at the same time: for the sake of relations with the United States, he wants to keep alive the illusion that he's ready for peace negotiations, but he wants to assure his government coalition further to the right since David Levy's, departure that the idea of a negotiation is going nowhere.

NETANYAHU: Wrong on both counts. Wrong and wrong. I'm not seeking peace for an illusion. I'm seeking peace for the sake of peace. I have my own small children at home and I want to secure their future. I have the children of Israel that I want to see live in a peaceful land, and I have our neighbors, including the Palestinians, who I think, like us, deserve a better future. That's what we're doing. I think this analysis, including the psycho babble that accompanies it is simply not serious.

If you sit in my position, and you understand the requirements of peace that Israel must have defensible and secure boundaries, you understand you don't just accept any demand that is made from the Arab side. And you understand that you have to insist on Palestinian compliance with the promises to fight terrorism. Those terrorists are real, they attack us, they blow up our buses, they bomb our cafe's. We have every right to expect Arafat to fight them. And we have every intention to make peace with them; with Arafat and the Palestinian Authority.

KING: Do you fight those in your country that turn to terrorism?

NETANYAHU: Yes, we don't have terror organizations. On occasion we have isolated individuals who do criminal things and we put them behind bars. We don't let them walk around free. You know, I brought with me two women, one, the mother of a young man who was slain by

terrorists, and they fled to Jordan -- to Jericho in the Palestinian areas. They're walking around in the cafe's of Jericho, laughing all the way. Another -- a sister of a man who is killed, his killers are in Gaza, serving on the Palestinian Police, giving interviews boasting of the murder.

We have a right to expect Arafat to punish these people or to extradite them to us; that hasn't happened. And every demand that I put up is for Arafat to comply with what he promised. But equally, I'm prepared to cede that territory that doesn't jeopardize Israel's survival and its security.

KING: All right, what did the president say to this, what you have just said to us? What did he say when you, obviously, brought home this point?

NETANYAHU: Well, he said let's figure out a way to weave the two; Palestinian compliance and Israeli redeployment and we worked on a number of possibilities. We haven't finished that job, and certainly, I think the U.S. would probably talk to Arafat and see where he stands.

But if there is good will on the Palestinian side, there's certainly good will on our side to try to get this interim business, this question of fulfillment of Palestinian promises and a partial Israeli redeployment out of the way so we can get to the real business, which is negotiating a permanent peace treaty between Israel and the Palestinians.

KING: Wouldn't it be better, instead of going back tonight, if you stayed and you met with the president and Mr. Arafat, or would this be the wrong time?

NETANYAHU: I think the United States wants to have a chance to hear him out the way they heard me out, and then we'll probably meet again, either in this way or in other ways, in a week or two. These things aren't resolved overnight. I've met Arafat before. I'll meet him again. I talk to him quite regularly on the phone. But what we're trying to do now is to prepare a move that will succeed in bridging the gaps between us, and moving to permanent peace negotiations.

KING: And you're saying on that front, you are willing to give as well?

NETANYAHU: Yes. Indeed, we've had several sessions of the cabinet, in which we try to define what are the strategic areas that Israel most preserve to defend itself in this tiny country beset by so many radical regimes and terrorist organizations. And at the same time, defining in this way what it is that we can be more flexible about. Territory that we can give in this redeployment. We've done that and we're ready to move.

KING: We'll be back with our remaining moments with the Prime Minister of Israel Benjamin Netanyahu on LARRY KING LIVE, right after this.

(COMMERCIAL BREAK)

KING: We're back with the prime minister of Israel, heading back to his country tonight. What -- are you leaving, did you say, we'll talk again? I'll see you Sunday or what -- with the president.

(LAUGHTER)

I'll call you after you talk to Arafat. How did the heads of state leave each other?

NETANYAHU: We were sitting in the Lincoln waiting room and it's very beautifully redone in it's original decor and there is a very large desk, wooden desk, that I guess, dates to the American Civil War and the president pointed out to me that all the peace treaties that the United States assigned were signed on that desk, including the Camp David Accords and the peace treaty with Jordan and the Oslo treaty. So I said, Mr. President, I hope very soon we have a chance to use this desk again, and that's more or less the way we left it, and I hope we do have a chance to use that desk again.

KING: Now, will you expect to hear from him again after he talks to Mr. Arafat?

NETANYAHU: I'm sure I will.

KING: Stories that you disagree with your own intelligence chiefs about the Palestinians and Hamas that they were saying that you have to give diplomatic things before they can take action against Hamas and you disagree? Is that true?

NETANYAHU: No, no, that's not true, but so much of what is reported is not true that you can't go around denying everything.

KING: Why do you think that happens to you a lot? That American Jews, a lot of American Jews are very upset with you and you were always very popular with the American Jewish community when you were ambassador and over here. Why you?

NETANYAHU: A lot of American Jews like me and some don't like me, just as people -- non-Jewish people are the same. I'll tell you what has happened though in the Jewish community, I think that it receives the reverberations from Israel. And essentially we have what one journalist perceptively called -- a Masonic movement on the left. They believe that we were coming into this new Middle East which presumably doesn't have Iran, it doesn't have Saddam Hussein, it doesn't have the Hamas fundamentalists and the bombs blowing away, and when that reality hit them in the face, literally hit us all in the face in these exploding buses, they -- I suppose attributed to me the collapse of a dream that was impossible from the start.

This journalist said something very perceptive. He said, it wasn't the election of Netanyahu that brought about the collapse of Oslo, but the collapse of Oslo that brought about the election of Netanyahu. And in many ways, I was elected to re-prop-up this process, but in a realistic way, demand that the terrorists stop, demand Palestinian compliance with promises they gave us, and also

arrive in a defensible peace, a peace that we can defend, which means not only Israeli concessions, but Palestinian concessions, some in Israel, especially on the left and some in the United States cannot forgive me for waking up the Jewish people and the people of Israel to this more sober reality, but ultimately, in the affairs of states, in the affairs of nations, you make peace when you're realistic and visionary, not just visionary with your feet off of the ground.

KING: We have a little over a minute. What was the high point for you on this visit?

NETANYAHU: I enjoyed the talks with the president. I thought we had broken some ice and broken some ground, but we still have a lot of ways to go.

KING: Low point?

NETANYAHU: A low point of this visit?

KING: Did you have a low point?

NETANYAHU: Yes, descending this morning to the exercise room with my wife at 6:00, and finding out that the two walking machines were taken up. That was in the basement. It was a low point.

KING: One other thing. Did the Holocaust Museum make a mistake in removing the request from Arafat to visit?

NETANYAHU: Oh, I don't want to get into that. We were not involved in that decision one way or the other. It's their decision.

KING: Yeah, but wouldn't you think it would be a good idea to let him go through that museum?

NETANYAHU: I really think it's their decision, but I think a bigger question, Larry, is whether Arafat will now stop the tremendous tide of anti-Semitic propaganda in the Palestinian-controlled media, including absurd illusions to the Holocaust, either as a fabricated Jewish, a Jewish fabrication or, in fact, these false symmetries that are made to the Jewish state.

KING: Thank you so much. Safe trip home.

NETANYAHU: Thank you, Larry. It's good to talk to you. I hope we'll get to see each other one day...

KING: One day...

NETANYAHU: ... not through the camera lenses.

KING: One day, it will be a split screen. Thanks.


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