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Outside the bureau the usual spin is spun. There's no concern at all. Relations with George Bush are excellent. Mutual esteem, reciprocal fondness, joint credibility abound. So what's to be afraid of? There's no danger the "road map" will turn into a road trap. Anyway, Ariel Sharon is good at getting out of traps. It's his speciality, leading others into the traps he himself has eluded.

However, the prime minister is not the same person he was not so long ago. Polite as always, evoking memories as always, but more cautious than ever. Lying under every question he sees a landmine. Lying under every statement is a crisis it is liable to foment.

Since the elections he hasn't spoken out much. In fact, even during the election campaign he didn't speak very much. The last time he said something explicit and clear, Justice Mishael Cheshin cut him off. No, he hasn't forgotten that, and no, he didn't like it. But no one will catch him uttering a word of criticism about a judge. He won't say a word about the journalists, either. He recognizes the importance of a free media. But the words he used then - you have gone crazy - reflects his feeling. What happened during the election campaign he still sees as a clear-cut case of irrational behavior.

The year that has passed since the Passover eve massacre at the hotel in Netanya was his greatest year. He responded to the crescendo of terrorism with military might - Operation Defensive Shield - and with political moderation (the confrontation with Benjamin Netanyahu at the Likud Central Committee meeting). In his mid-seventies he achieved unprecedented popularity because he proved so adept at maneuvering within the Bush-Arafat-Netanyahu triangle.

It was the solid backing of the president of the United States that made it possible for him to imprison Arafat in the Muqata and Netanyahu in the treasury. However, the suspicion is looming now that the year of grace is drawing to a close; that it is Bush who is about to imprison Sharon himself in the road map. So things are very tense these days in the Prime Minister's Bureau. Quiet, but tense.

Prime Minister Sharon, we are at an astonishing historic moment. The reality around us is changing radically. From your point of view, is the new reality in the Middle East after the fall of Iraq promising or dangerous? Good or bad for Israel?

Sharon: "The Iraqi leadership was a horrific and murderous one. As early as 20 years ago they understood it was impossible to acquire an Islamic bomb, and therefore it had to be manufactured. So the removal of Iraq as a threat is definitely a relief. However, this does not mean that all of the problems we are facing have been removed. Iran is making every effort to produce weapons of mass destruction and is engaged in making ballistic missiles. Libya is making a very great effort to acquire nuclear weapons. What is developing in these countries is dangerous and serious. In Saudi Arabia, too, there is a regime that grants sanctioned aid to terrorist organizations here.

Are you saying that what happened in Iraq has to happen, in one way or another, in Iran, Libya and Saudi Arabia?

"In the matter of Iraq, the United States showed leadership at the highest level. I don't think it is realistic to think that immediately after the conclusion of one campaign, another will begin. Even a superpower has limits. When you win, you are also weakened to a certain degree.

"But we face the possibility that a different period will begin here. The move carried out in Iraq generated a shock through the Middle East and it brings with it a prospect of great changes. There is an opportunity here to forge a different relationship between us and the Arab states, and between us and the Palestinians. That opportunity must not be neglected. I intend to examine these things with all seriousness."

Do you think there is a prospect of reaching a settlement in the foreseeable future?

"That depends first and foremost on the Arabs. It obligates a different type of leadership - a battle against terrorism and a series of reforms. It obligates the absolute cessation of the incitement and the dismantling of all terrorist organizations. But if there will be a leadership that understands these things and will carry them out seriously, the possibility of reaching a settlement exists."

Do you consider Abu Mazen a leader with whom you will be able to reach a settlement?

"Abu Mazen understands that it is impossible to vanquish Israel by means of terrorism."

One day very soon the telephone might ring. The president of the United States will be on the line. He will tell you, Arik, I have removed an existential threat from Israel, I am fomenting a revolution throughout the region. Now the time has come for you to make your contribution. Let's have Netzarim, please."

"There are some matters regarding which we will be ready to take far-reaching steps. We will be ready to carry out very painful steps. But there is one thing that I told President Bush a number of times - I made no concessions in the past, and I will make no concessions now, or ever make concessions in the future, with regard to anything that is related to the security of Israel. I explained to President Bush and made it clear to him that this is the historic responsibility that I bear for the future and the fate of the Jewish people. You should know this - on this subject there will be no concessions. We will be the ones who in the end decide what is dangerous for Israel and what is not dangerous for Israel."

And what about Netzarim? [An isolated settlement in the Gaza Strip]

"I don't want to get into a discussion of any specific place now. This is a delicate subject and there is no need to talk a lot about it. But if it turns out that we have someone to talk to, that they understand that peace is neither terrorism nor subversion against Israel, then I would definitely say that we will have to take steps that are painful for every Jew and painful for me personally."

Isn't that phrase "painful concessions" a hollow expression?

"Definitely not. It comes from the depth of my soul. Look, we are talking about the cradle of the Jewish people. Our whole history is bound up with these places. Bethlehem, Shiloh, Beit El. And I know that we will have to part with some of these places. There will be a parting from places that are connected to the whole course of our history. As a Jew, this agonizes me. But I have decided to make every effort to reach a settlement. I feel that the rational necessity to reach a settlement is overcoming my feelings."

You established the settlements and you believed in the settlements and nurtured them. Are you now prepared to consider the evacuation of isolated settlements?

"If we reach a situation of true peace, real peace, peace for generations, we will have to make painful concessions. Not in exchange for promises, but rather in exchange for peace."

Some people expect you to be an Israeli [Charles] de Gaulle - a national leader, a general, who at a certain point understands that reality has changed and turns his back on part of his own history and creates a dramatic historical turning point. Do you have any such aspirations?

"One has to remember one thing about the comparison with de Gaulle - `Algeria' is here. It is not a few hundred kilometers away. The required measure of caution here is therefore much greater."

But I am asking about you. Do you want to be remembered as the one who spearheaded such a dramatic change?

"Let me tell you something. I am determined to make a real effort to reach a real agreement. I think that anyone who saw the tremendous thing called the State of Israel in the making possibly understands things better and knows better how to reach a solution. That is why I think that this task rests with my generation, which was privileged to live through one of the most dramatic periods in the history of the Jewish people.

"I am 75 years old. I have no political ambitions beyond the position I now hold. I feel that my goal and my purpose is to bring this nation to peace and security. That is why I am making tremendous efforts. I think that this is something that I have to leave behind me - to try to reach an agreement."

Have you really accepted the idea of to states for two peoples? Do you really plan to divide western Israel?

"I believe that this is what will happen. One has to view things realistically. Eventually there will be a Palestinian state. I view things first and foremost from our perspective. I do not think that we have to rule over another people and run their lives. I do not think that we have the strength for that. It is a very heavy burden on the public and it raises ethical problems and heavy economic problems."

Even so, under your leadership Israel went back to directly controlling Palestinian cities.

"Our stay in Jenin and in Nablus is temporary. Our presence in those cities was created in order to protect Israeli citizens from terrorist activities. It is not a situation that can persist."

In the past you talked about a long-term interim agreement. Did you not believe in a permanent solution and an end to the conflict?

"I think opportunities have currently been created that did not exist before. The Arab world in general and the Palestinians in particular have been shaken. There is therefore a chance to reach an agreement faster than people think."

The Israeli public chose you twice by a large majority because it wants you to repulse Yasser Arafat and beat him. Have you done that?

"I think that one of our successes is that we opened many people's eyes to the true nature of the Palestinian Authority and the nature of the person who heads it, making him irrelevant. When I used that phrase in the past it shocked many of our supporters, mainly those who write and express themselves. But in the end, Arafat became irrelevant."

Do you not fear that perhaps you won the battle against Arafat and against the terror but lost in the matter of the Palestinian state and the settlements? After all, the thing on the agenda now is the road map, which is not very comfortable for Israel.

"We supported the principles that were presented in President Bush's speech of June 24, 2002. As long as the sketch matches the speech, it is acceptable to us. Regarding the latest draft that was sent to us, we have 14 or 15 reservations that I have passed on to the White House."

What are the main reservations?

"The main issue is security. How terror will be handled. There is no difference of opinion in this matter but there is a difference in the wording.

The second matter is that of the implementation of the stages. Our understanding with the United States is that the will be no transition from one stage to the next without the completion of the previous stage. The determining factor is not the timetable but the execution. That is why the issue of the stages is of paramount importance to us.

Our third reservation concerns the right of return. This definitely poses a problem.

Is your willingness to recognize a Palestinian state conditional on the Palestinians backing down from their demand for the right of return?

"If there is ever to be an end to the conflict the Palestinians must recognize the Jewish people's right to a homeland and the existence of an independent Jewish state in the homeland of the Jewish people. I feel that this is a condition for what is called an end to the conflict. This is not a simple thing. Even in the agreements we signed with Egypt and Jordan this was impossible. That is why they did bring about an end to the conflict. They are important agreements, very important, but they did not bring about an end to the conflict. The end of the conflict will come only with the arrival of the recognition of the Jewish people's right to its homeland.

That has to do with the end of the process. But do you think that the compromise on the right of return has to come beforehand?

This issue must be clear right from the outset.

Would you be willing, perhaps as a gesture to the Americans, to freeze construction in the settlements or to evacuate illegal outposts as part of the first stage?

"That is a sensitive issue. In the final stage of negotiations it will be brought up for discussion. We don't have to deal with it just now."

One of your tactical achievements is your success in avoiding as much as possible any situation that forces you to make difficult choices. But if we are in fact approaching the moment of truth and your choice will have to be between Bush and Ze'ev Hever. [A prominent settler leader and close associate of Sharon's]. Who will you choose?

"Each of the two people you mentioned is a special and impressive person. Each of them is very impressive in his own field."

Bush will also have to choose soon between two people whom he appreciates - Ariel Sharon and British Prime Minister Tony Blair. Are you not afraid that even with all Bush's respect and affection for you he will choose Blair?

"We are not under pressure. There is dialogue. Sometimes we see things the same way, sometimes we view them differently. But our relationship is very close. Our relationship with the White House has never been so good. I would like to emphasize that we are not in a conflict with the U.S. I do not live with a feeling that we are under any threat.

There are those who feel that the road map is worse than the Oslo accords. Some people figure the Americans have caught you off guard, that they led you to believe that the road map is not a serious document and then presented it to you as a fait accompli. Do you not feel that you have been misled?

"No. Not at all. Israel is not a pawn on a chessboard that anyone can move. We live here. It will be impossible to budge Israel on the major matters that are principles of her existence."

Do you feel that the dark and violent period of the past three years is ending?

"I will make every effort to make it end. I do not intend to be passive. The moment a Palestinian state forms I plan to begin working with it. I will not wait for the telephone to ring."



`I trust Netanyahu, the economic plan - and my sons'

Your finance minister is a Thatcherite, he believes in a small government and a big free market. In the past you were also a Thatcherite. Are you comfortable with the [economic] plan?

"We have reached a stage where difficult measures are necessary. This is a necessary step. therefore I support the plan that Mr. Netanyahu presented to the government."

The whole plan is acceptable to you?

"Everyone can fiddle and find an article here or an article there that he can argue about. But we are talking about these things also. This is a plan that must be passed. We all must stand together on this matter. This is not an easy matter, it is a difficult one, and it requires a great effort from all of us."

Your relationship with Mr. Netanyahu is well known. Are you not sacrificing him? Do you not enjoy watching him sweat?

"No. Not at all. I hear that there is such talk. But I can say with certainty that my relationship with him is good. I am in close communication with him. We talk nearly every day, and sometimes more than once a day."

Do you respect him?

"I think he is an excellent finance minister. He has my full backing, and he will continue to receive my full backing."

Besides the personal question, there is a fiery social and economic debate taking place. Your voice is not heard in this debate. Are you not worried that your government will be viewed as an Ashkenazi, secular and sated government that lacks sufficient social sensitivity?

"I do not think that this government ignores social issues. I also don't think there is any link between social sensitivity and ethnic origin."

Are you enjoying this government more than you did from the previous one?

"I think this is a very good government. It has good ministers and it is handling matters very well. But I enjoyed the previous government also. In my eyes its greatest achievement was that it brought a near end to hatred between the right and the left. This, in my opinion, is one of our greatest achievements."

Still, during the elections, the spirits were inflamed once again. What did you think when you found yourself under fire once more?

"Well, all right, this is not the first time that I encountered such things. Did I feel good about it? I did not. But I knew what the truth was. I knew that the day after the elections it would all disappear. Look, the Jews are great. Really great. The Jewish nation is among the great nations, perhaps the greatest nation. But the Jews also know how to hate."

Do you not think that there was a flaw in the relationship between your son Gilad and Dudu Appel and Cyril Kern or in the relationship between your son Omri and Shlomi Oz?

"Believe me, I am not involved in those things. I do not know the details. I trust my sons."

The sons are an important part of your decision making process? Are they active partners in the handling of the affairs of state?

"These claims are exaggerated. The sons are not part of the handling of the affairs. But our family is very special. I think that Lily [Sharon's late wife] had a part in creating a special atmosphere inside the family. They are good friends, the boys, true friends. I am proud of them."

You are a man that respects action, striving, bravery and friendship. However, maybe the whole matter of rule of law and public ethics does not really relate to you.

"This is a matter that relates to me a great deal. The law is the law and everything related to it must be obeyed. I support keeping the law in full, for everyone, on an equal basis."