Interview With Gil Tamary of Israel's Channel 10

QUESTION: More than a month has passed since the Annapolis summit and many people are feeling that the momentum in -- from Annapolis already gone because not much has been done on the ground, so I wonder, do you feel that both leaders, Olmert and Mahmoud Abbas, are doing what you expect for them to do in the pace you expect for them to do in order to meet the deadline of reaching an agreement (inaudible)?

SECRETARY RICE: Well, I very much trust these two leaders that they want very much to achieve agreement in the year 2008. They have both made statements since Annapolis that reaffirm their commitment to do so. It's not easy. These are issues that have been around for a very long time where there is an atmosphere in which there hasn't been very much trust. And some things have happened since Annapolis that have made it difficult to move forward.

But one of the reasons that the President will go there is to say to both leaders now, the time is now and to try to give a spur to these very important bilateral negotiations that are going on, but I'm not surprised that it's hard at the beginning to get going.

QUESTION: What about the unauthorized outpost? They haven't been evacuated yet, they haven't been dismantled yet.

SECRETARY RICE: Well, I was very much struck by what Prime Minister Olmert said when he talked about Israel's need to meet its obligations as well as the Palestinians' need to meet its obligations. And so I believe that this Israeli Government understands the importance of its roadmap obligations, that they will start to move to meet those roadmap obligations. The United States, of course, has accepted to lead a process to help the parties understand whether they're making progress on their roadmap obligations. And both Palestinians and Israelis really should do everything that they can to improve circumstances on the ground, but I was very struck by what Prime Minister Olmert said.

QUESTION: But what about people on the ground? On the ground, nothing has been done.

SECRETARY RICE: Well, I wouldn't say that nothing has been done.

QUESTION: Very little.

SECRETARY RICE: In fact, again, these are issues that are very, very hard. But we do expect both sides to act with urgency. We do expect the negotiations to move forward. We do expect both sides to live up to their obligations. The Palestinians need to meet their security obligations. They need to do everything that they can to fight terror. Israel, frankly, needs to look at its roadmap obligations and to do nothing that would prejudge a final status agreement. This is why we've spoken --

QUESTION: So settlement (inaudible)?

SECRETARY RICE: Well, this is why we've spoken out when there have been these announcements of possible housing tenures and the like. But again, I see that Prime Minister Olmert and President Abbas are going to meet again. They're going to meet again soon and Tzipi Livni and Abu Allah are going to meet as well. I think they know that the world is watching, the world is waiting for progress, and I expect that they're going to make it.

QUESTION: The Israeli public is very skeptical. One of the latest polls show that 90 percent of the Israeli population do not believe you will prevail eventually, the Administration effort. And on a daily basis, Gaza, there has been bombardment from Gaza towards Israel of Qassam rockets, smuggling of weapons from Egypt. Do you intend to do something, to speak with the Egyptians, for instance, that they will stop the smuggling?

SECRETARY RICE: Well, the Egyptians have just said that they are going to work with -- even the United States. We had a team of the U.S. Army Corps of Engineers out to talk about technical ways that we might help to deal with the tunnels. It's also an issue that there needs to be more done. I've said that directly to the Egyptians. I'm sure that the President will say it when he is there. The rocket fire from Gaza needs to stop, but of course, Hamas, which is perpetrating not just crimes against Israel, which it is, but also really putting its own people in the most desperate of circumstances in Gaza.

The best way to demonstrate that there is a different way for the Palestinian people is to have a vision, a fulfilled vision for a Palestinian state and that is what President Abbas and Prime Minister Olmert are working to do and that's why these negotiations are so important.

QUESTION: Still, the number one issue that troubles the Israeli people is, of course, Iran. Can you assure the Israeli people that eventually, after -- under any circumstances, this Administration will make sure that Iran wouldn't have nuclear weapons?

SECRETARY RICE: Well, the international community as a whole has got to take this responsibility. Of course, the United States has said very clearly that an Iran with a nuclear weapon would be a grave danger to the Middle East and a great danger to the world. That's why we have organized and led efforts to pressure the Iranian regime to change course and to do something different than it's doing. That's why people need to look hard at their financial aspects of their relationship with the Iran, the trade aspects of their relationship with Iran, their banking aspects.

And since the United States has sanctioned Iranian banks and Iran sits there under Chapter 7 resolutions, I think you will continue to see the isolation of Iran internationally, financially, and that's very important. But ultimately, the United States has to have the cooperation of the international community to do this because we want to solve this diplomatically. We believe it can be solved diplomatically. The President doesn't take options off the table. That's the way that an American President should operate. But we believe this can be resolved diplomatically and we're working to do so.

QUESTION: I was confused a little bit after the latest intelligence report. The President is speaking for the last two, three years about the danger from Iran and then this report is being published and it seems to be that it's undermined your entire effort. What's going on here?

SECRETARY RICE: Well, there is nothing in this intelligence report that would suggest that Iran is not a danger. In fact, I would say that what this intelligence report tells us is that of the three aspects of building a nuclear weapons program, Iran continues to have an option on two of them; that is that they're continuing to enrich and reprocess. That's the way you get fissile material that can ultimately be pure enough to make a bomb.

Secondly, Iran continues to work on missile delivery systems at ever-longer range. Now the piece that our intelligence agencies now say has been halted since perhaps 2003 is actual weaponization; that is making material into a bomb, learning how to design that. But frankly, the fact that up till 2003, they were apparently doing so, should give the world pause and the Iranians should be answering a lot of questions about what they were doing. What's the state of that program? Is it on a shelf someplace? What is the state of that program?

So we consider Iran to be very dangerous in terms of its nuclear ambitions, in terms of what it is doing in the region in support of terrorism, in trying to destabilize in Iraq, in Lebanon, in the Palestinian territories themselves where Iran has been a very negative factor. So we're going to continue to press the case that Iran is a danger to the region and continue to rally our allies in the international community to resist.

QUESTION: You were able to bring the Saudis into Annapolis and it was a big achievement. But nevertheless, the people in Israel were amazed by the fact that the Saudis arrived there, but they reacted towards Israeli leaders like Olmert, like Barak, like Tzipi Livni, like they were infected with leprosy. They didn't shake their hands and --

SECRETARY RICE: Well, these things take some time. This is the first time that Saudi Arabia has come under its own flag to a peace conference and sat at the table not very many paces, frankly, from the Israeli delegation and some others. Israel and Saudi Arabia do not have diplomatic relations. I hope that we're looking at the beginning of a process by which, step by step, the Arab world will reach out to Israel because that should be a part of this broad Annapolis process and it is something that we are very much saying to the Arabs.

I will note that the Saudi Foreign Minister did applaud when Prime Minister Olmert was finished and it was a good spirit in the room. But we're not making -- not going to make every breakthrough in one meeting, but it was an important meeting that Saudi Arabia was there under its on own flag.

QUESTION: You are committed so much to the peace -- this peace process and I wonder if it has something to do with your background as a child in Alabama, witness hate crimes or witness terrorism? Is that one contributor to the fact you so much desire to bring peace to our region?

SECRETARY RICE: Well, I think any American Secretary of State going all the way back has had a strong interest in trying to see if we couldn't help use American influence to bring an end to the conflict. But yes, I think that sometimes one has to be careful about analogies. But I feel that I understand a little bit that when an Israeli mother puts a child to bed in Sderot or in a place that is under Haifa that they are -- you put your child to bed just a little bit afraid that maybe a bomb will go off.

And you know, since I lost a childhood friend in that bombing of the church in Birmingham, a little girl -- who with whom I'd gone to kindergarten, I know my mother must have had that fear. And I know, too, that a Palestinian mother who has to tell her child, well, we're not going to go on that road. Because you're Palestinian, must feel a little bit of a humiliation, even the anger that my parents felt when they had to say to their six or seven year old daughter, well, you can't go in there because you're black.

And that's the reason that this conflict needs to end. You know, we talk about the two-state solution. It's a kind of antiseptic concept, the two-state solution. But what we're really talking about is a state that the Palestinians can have that is a homeland for the Palestinian people and next to Israel as a homeland for the Jewish people -- defensible homeland for the Jewish people. And that, it says to me, means so much more than the phrase the "two-state solution" because it means that when that is achieved, Israeli and Palestinian parents and their children will grow up each in their own state with their own futures in their hands.

QUESTION: Madame Secretary, thank you very much for your time and for this interview.

SECRETARY RICE: Thank you.

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