President Bush rejected strong pressure from Arab and European governments and advice from his own State Department when he demanded “new leadership” as a prerequisite for Palestinian statehood on Monday.

The battle to influence the long-awaited — and for many Jewish leaders, long-dreaded– policy statement was intense. But Washington sources say it was mostly the president’s own visceral instincts that turned Monday’s speech into a blunt challenge to the Palestinian people to get rid of Yasser Arafat.

For weeks, news reports have focused on internal disputes between Secretary of State Colin Powell, who favored an aggressive U.S. effort to jump-start Palestinian statehood, and a locus of officials that included Vice President Dick Cheney and Defense Secretary Donald Rumsfeld, who worried that a big U.S. push on statehood would just serve to reward Palestinian terrorism.

A president who sees the world in stark black and white was pressured by Arab and European allies to look more at shades of gray in the conflict. But in the end, Bush reverted to type.

Last week’s terror bombings, which forced a delay in the presidential proclamation, only reinforced Bush’s harsh views about Arafat and his determination not to reward terrorism by presenting a U.S. timetable for Palestinian statehood.

At the same time, even State Department officials who argued that the Palestinians needed immediate progress on statehood to establish a political “horizon” found themselves unable to muster strong arguments that Arafat should be given the state he apparently still believes he can win with suicide bombers and Iranian-supplied arms.

Bush was convinced that giving in to Arab demands for immediate statehood would be perceived around the world as a statement that terrorism will be tolerated when it suits U.S. political goals.

The speech also reflected Bush’s growing conviction that exporting democracy is one of the long-term necessities in the war on terrorism.

That vision is producing some dissonance. Saudi Arabia and Egypt are vital allies, but both are harshly autocratic states with mixed records on terrorism.

Washington does not demand democratic reforms from these countries as the price of their special relationship with Washington, a fact that has led to charges that an administration double-standard is undermining its own anti-terror war.

Monday’s speech throwing down the gantlet to the Palestinians may have produced tremors in Riyadh and Cairo, where the autocrats must be wondering if they are next in Bush’s new focus on democracy-building.

If that new emphasis holds, it could eventually produce a major upheaval in U.S. foreign policy and big problems for the Saudis and Egyptians.

There were also clear political factors in the president’s tough line on Arafat and the latitude he continues to give to Israel.

For a week before the speech, leaks about its possible content produced strong statements of concern from Capitol Hill — and not just from Democrats.

Israel’s support in Congress has never been stronger or more bipartisan; Arafat’s stock has never been lower.

Important elements in the president’s own power base, including conservatives in Congress and groups like the Christian Coalition, made it clear they would join with hawkish pro-Israel groups to fight any effort to provide provisional statehood while the bombs were still flying.

But in the end, Washington sources all seem to come back to the same conclusion: the biggest factor in Monday’s speech — anticipated for days, but unexpected in content — was Bush’s visceral feeling that he couldn’t conduct a worldwide war against terrorists while giving Yasser Arafat a free ride.

It was that instinct that led him to discount State Department demands that he walk a diplomatic tightrope and try to avoid offending either side. It was that instinct that led him to ignore strong pressure from European and Arab allies.

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