If you want to know where America's Mideast policy is headed, David Makovsky is a good man to ask. It's not just his credentials - a senior fellow at the Washington Institute for Near East Policy, educated at Harvard and Columbia, 11 years in Israel as a Ha'aretz diplomatic correspondent and Jerusalem Post executive editor, a member of the Council on Foreign Relations - but his connections. Makovsky counts among his friends his co-author for the recent book Myths, Illusions and Peace: Finding a New Direction for America in the Middle East, veteran diplomat Dennis Ross, a man who is neglecting his book tour responsibilities because he is serving as President Barack Obama's Special Assistant to the President and Senior Director for the Central Region in the National Security Council. The book jacket contains a blurb by another friend, Lt.-Gen. Keith Dayton, the United States Security Coordinator for Israel and the Palestinian Authority, or more simply, the man training the PA's forces to maintain sovereignty over the West Bank. Dayton does not mince words. "I rely on the work of Dennis Ross and David Makovsky for deep strategic thinking. I value their research and analysis. I consider their work a national treasure of the United States." So it is fair to say that Makovsky, more than most, can explain what's going on in the "mind" of the American administration. In a recent conversation with The Jerusalem Post, he discussed the logic behind the strange optimism of the current administration over the prospects for Israeli-Palestinian peace - an optimism that seems sorely lacking outside Obama's immediate orbit. THE BOOK IS not intended for audiences in the Middle East, but rather it is part of the raging debate in the United States over the country's Middle East policy. With "skin in the game," the questions of American support for Israel, democratization and Arab governance and dysfunction have become politically acute and urgent. Myths, Illusions and Peace is at its core an argument against the theory that has been popular for many years among Arabists and policy wonks in Washington, one repeated by too many Arab leaders to ignore: That the Middle East's deep and abiding tensions draw much of their energy from the conflict with Israel, and specifically the unfair fight between Israel and the Palestinians. This argument has profound ramifications for policymaking. Linkage can harm peace, as in the initial reluctance of the Carter administration to help launch the Israeli-Egyptian peace process because they were not convinced that Sadat's idea to break with the Arab consensus could work. Furthermore, American policy that acquiesced to Arab warnings about US ties to Israel has historically failed to produce results favorable to America. Arab states kept their close ties to Washington despite the Israeli-American alliance, and their policy was never dramatically altered away from their own national interests based on the condition of the Palestinians. "Too often, the United States neither won favorable Arab reciprocity when it did as the Arabs suggested, nor suffered a disaster when it did not heed Arab warnings," the authors note. In fact, linkage is a tactic used by Arab states as "a way to shift the burden of peacemaking from themselves to the US. If only [America] could 'deliver Israel,' they are saying, the regional situation would be transformed. It's one more way the Arab states have used this conflict for their own purposes to make sure the burden is not on them," Makovsky explains. Indeed, the Arab appeal to the linkage argument has been a primary tool for Arab regimes to defy calls for reform at home. It is an argument that has started to lose traction in the Arab public even while it has found new allies in Washington. Makovsky and Ross quote Egyptian writer Hassan Hafez, who wonders "why we blamed Israel for every fault in [our] societyâ€¦. [Blaming Israel] causes us to look ridiculous before the world and it makes the small Israeli state look great." YET, DESPITE ITS call for placing proper responsibility on the Arab side, this book is no neocon treatise. The first sentence of the book sets the tone: "There can be little doubt that America's standing in the world declined dramatically during the administration of George W. Bush." The authors argue against regime change as the best path to democratization and reject the view that the Iranian regime is insensitive to economic pressure. While harshly critical of those who claim Israel is a strategic liability for the United States - "if the US could renege on Israel, it's saying it could renege on anybody," notes Makovsky - it is profoundly optimistic about the potential for a negotiated settlement with the Palestinians. Where does this optimism, which is apparently shared by the Obama administration, come from? Are the Americans impervious to the experiences of the past 16 years of peacemaking? Don't believe everything you read in the papers, says Makovsky. "Sometimes the news is what isn't reported." What isn't being reported is the quiet revolution taking place in the West Bank under Salam Fayyad, one that should impress even the more fatalist of cynics, he adds. The Hamas takeover in Gaza in 2007 "was an unbelievable wakeup call that made the PA understand that Hamas is coming to the West Bank if they don't get their act together." For the Israelis, too, "the alternative to Salam Fayyad is not the Hadassah women of Brooklyn. It's Hamas that will pick up the pieces." This has created a whole new willingness to work together that has not been seen since Oslo. "Since 1996, [in the wake of the Hamas terror attacks of that year,] we've been hearing about the 'revolving doors' of the Palestinian security services - that the Palestinians arrest the Hamas guys and let them go. They're not doing that anymore. There are 800 Hamas prisoners in [PA jails in] the West Bank." In the religious sphere, too, "they're moving imams out of the mosques. There are 1,800 mosques [in the West Bank] and the PA is slowly changing their imams" from those sympathetic to Hamas' message of destroying Israel to others more willing to compromise in order to end the conflict. "They're not doing this as a favor for Israel," Makovsky is quick to stress, "but as a favor to themselves." He insists the Israelis should move forward, too, though "without taking reckless risks. I told Condoleezza Rice at Annapolis that the Israelis feel they read the book in Gaza and don't want to see the movie in the West Bank." But "the fact that the PA's actions are not in the name of Zionism, but for their own self-interest, means that it's sustainable over time. We're already seeing a lot of intelligence cooperation. A senior Israeli security official told me that the difference now is that the PA 'doesn't lie to us anymore' on security issues." With that cooperation, Israel has been able to dismantle huge numbers of checkpoints and roadblocks, to open the flow of goods and people in the West Bank and to enable a massive 7% economic growth over the past year. "The occupation is still there, but the Israelis deserve credit" for their part in the slow improvement spreading throughout the West Bank. "This is a quiet revolution." Yet the revolution does not seem to be changing the anti-Israel - and often anti-Semitic - rhetoric of official PA media. Is security cooperation enough to make peace? "When you read the Israeli press, you get a sense of fatalism that the Arabs will never recognize Israel has a valid claim to this land," worries Makovsky. "I tend to think after meeting senior Palestinians that [withholding recognition] is a bargaining chip. Even Yasser Arafat for a time liked to talk about the Jews as 'our cousins.'" Makovsky points to polls conducted by Khalil Shikaki, director of the Ramallah-based Palestinian Center for Policy and Survey Research, which show that about half of Palestinians say Israel is a Jewish state. "Instead of being fatalistic, Israelis [should know] that each side is going to recognize the valid historical claim of the other. I don't think this is so hopeless." But "the more Israel talks about it," especially the Netanyahu government's focus on the issue, "the higher its value and its price." "Let's remember that the Palestinians always speak of international requirements and UN resolutions. But the 1947 [UN General Assembly] partition resolution [number 181] mentioned no less than 30 times that the new state is a Jewish state." THIS AMERICAN OPTIMISM underscores the extent to which linkage is not merely incorrect, but often the reverse of the reality on the ground. For Makovsky, the Arab states seem to have a greater difficulty accepting Israel than do the Palestinians. At a recent dinner, Makovsky asked an Arab head of state "what mistakes the Arabs made and what lessons we could learn from the 1990s. [The Arab leader] said, 'Look, we're not elected by anybody, and we know that. So frankly we don't do peace any favors. We really hesitate.'" Israel, explains Makovsky, "has this view that kings or emirs don't have to deal with public opinion because 'they're the king.' But my experience in the past nine years has been the opposite. These leaders fear public opinion. Democracy breaks a deadlock. In a democracy, if you get 51 percent on your side, you can claim a mandate. But these people need 100%, because they don't feel they are elected by anyone. And if you're waiting for 100%, you'll be paralyzed." Thus, instead of shaping a consensus, instead of leading and prodding the Palestinians and their own peoples toward peace, Arab dictators are dragged down into the basest passions of public opinion. The Arab leader's admission "was an indication that instead of shaping the consensus, they have to reflect it. Arab regimes feel too illegitimate to be cheerleaders for compromise." That, he explains, is the logic behind the Arab Peace Initiative, "which says that if Israel does everything, the Arabs will normalize as a group, but not in parallel steps and not as individual states." That offer - "which doesn't have traction in Israel because it's completely backloaded, with Israel doing everything first" - "is a missed opportunity. I think it makes much more sense that for every move Israel makes toward the Palestinians, there would be a step to integrate Israel into the region. That would create legitimacy [for integration] in the region." But there is a real fear among Arab leaders "that this is politically too hard for them." MAKOVSKY AND ROSS are known as analysts with close ties to Israel. Among other roles they have filled, Ross was until recently the chairman of the Jewish People Policy Planning Institute, a Jerusalem think tank founded by the Jewish Agency, and Makovsky has been editor-in-chief of the Post. What is their response to those who say they are merely attempting to shift the blame away from the Israelis for stalled peace talks? "These are not arguments against the peace process. We believe there needs to be a focus on Arab-Israeli peace," Makovsky says emphatically, "but we don't think it should be oversold as the 'open sesame' to solving the entire Middle East. That's just erroneous." They "recognize that the Israeli-Palestinian issue is evocative, and its resolution might take a card out of the hands of Al-Qaida and others - but it won't eliminate the terrorism." The Israeli-Palestinian conflict "is not the source of other conflicts, and therefore it's not the pathway to their resolution. It does not end the Iranian nuclear problem, sectarian differences in Iraq, or the problems that have plagued Yemen. We'd like to see the [Israeli-Palestinian] conflict resolved, but for the right reasons." In the wake of the policy failures of Obama's first eight months - "I think it was a mistake to spend the last eight months focusing on the settlements issue almost exclusively" - Makovsky believes the administration has learned its lessons and is moving forward. "I think President Obama genuinely believes that most Israelis and Palestinians want a two-state solution." And even some of the trickiest problems are attainable. For example, demarcating the final borders with a land swap of just 5% of the West Bank will give the Palestinians a huge initial victory, while giving the Israelis closure on the settlements. "For 40 years, [Jewish settlers] have been dangling bargaining chips. That's a rough way to treat your citizens. If you annex to Israel the 80% of settlers that live on 5% of the West Bank, largely adjacent to the Green Line, then these people would transform from a problem into a solution, because their legal situation would improve." It's important to move forward in piecemeal but tangible steps, Makovsky insists. "In the Middle East, whenever it's all or nothing, it's nothing. The public is cynical," he says of both sides. "It's heard every peace speech at every peace conference and doesn't believe anything anymore. The Israelis think they got out of Gaza and only got rockets. The Palestinians feel that for all the talk of Oslo there are still checkpoints and occupation. There's enough reason to be frustrated and cynical as a default, and not to believe any speech." If Obama avoids falling into this trap - "an Annapolis II conference would be a kiss of death" - then there's a real chance to bring peace with a Fayyad-led PA. "Salam Fayyad is redefining Palestinian nationalism away from defiance, resistance, armed struggle - what we call terrorism - and toward institution-building." His model? Pre-state Israel. "Fayyad told President Bush that Israel was successful because it was busy building institutions from the Balfour Declaration [in 1917] to the founding of the state [in 1948]." Until recently, "Israeli leaders thought the Palestinian leadership was more interested in tearing down Israel than building Palestine." That's not true anymore. And with a joint enemy, the window for peace is currently open, Makovsky says. "Are we going to miss this moment and let Hamas pick up the pieces?" he wonders.