Israel has rarely, if ever, faced so grave a potential military challenge. Yes, it has been threatened and subsequently attacked on all of its territorial frontiers, but its enemies, though often viciously potent, were always undermined by their disunity. Today, the dangers posed by Hizbullah to the North, by Hamas from its Gaza control center, and by the emboldening Islamist threat in the West Bank are all underpinned and coordinated by a single player, the feverishly ambitious regime in Iran, which is also inexorably reeling Syria into its orbit while pressing full-speed ahead to its nuclear weapons goal. As has been noted before in this column and elsewhere, the current US-led effort to revive the Israeli-Palestinian diplomatic process is plainly intended in good part to galvanize a relatively moderate regional alliance to offset that Iranian threat. In an article earlier this week in The New York Times, op-ed writer David Brooks defined it depressingly as a "coalition of the losing" - an alliance of those nations that "resist" the marching Iran-Syria-Hizbullah-Hamas partnership. The trouble is that the purportedly resisting players, with the singular exception of Israel, do not actually appear to be prepared to fight back. Egypt, under an aging, ailing president, has to date been unable to rouse itself to counter the Islamist threat to its own regime. Jordan's monarchy, once so confident that it had chosen the right partner in America, and so derisive of Syria's alliance with Iran, has watched the US flounder in Iraq, is losing its faith in Washington's superpower capabilities and must grapple anew with all the familiar problematics of its own Palestinian demography. Saudi Arabia is itself a well of Islamic extremism and is readying to respond to an Iranian nuclear capability not via an alliance of the moderates but through a nuclear program of its own. And then there are the Palestinians... which is where the Quartet's Middle East envoy Tony Blair comes in. Blair, who gave The Jerusalem Post a candid and impassioned interview during his latest 24-hour visit here on Sunday, reasonably posits that Mahmoud Abbas, the president of the Palestinian Authority, represents the only hope of avoiding the completion of the Islamist takeover on Israel's doorstep. Blair further argues that Islamic extremism, among the Palestinians as elsewhere, has to be overcome by military force where necessary and by trumping its ideology on the battleground of ideas with a message of freedom, democracy and justice. He has personally paid a heavy price for his principled positions on the need to stand up to the death-cult extremist mindset; his determination to "stay the course" in Iraq and in the wider battle, extending to his hugely unpopular empathy for Israel, played a central role in his downfall last year after a decade as British prime minister. But even in an interview clearly intended to encourage Israelis to give the diplomatic process another chance - to rally behind our prime minister because the status quo works against Israel and there are precious few alternatives to trying again with Abbas - Blair could only intimate that he believed Abbas would sooner or later adopt viable public positions on the issue of Palestinian refugees. And he was honest enough to state that he was not certain Abbas could provide the basic security capabilities essential to the interim process of territorial compromise. Blair urged that Israel put Abbas to the test, rather than confidently asserting that, yes, this PA leader will put everything on the line to deliver. In other words, when it comes to Blair's own recipe for countering the Islamists in our context - using force where necessary to thwart the killers, and defeating the extremist ideology by endorsing positions that would yield genuine freedom - the portents from Abbas are underwhelming. Thus far, it can unfortunately be said with certainty, Abbas has been unable to marshall capable force against the extremists, both within his own Fatah organization and the Islamist groups; Gaza fell to Hamas with barely a struggle. And thus far, too, whether for tactical reasons, fear for his own physical well-being or other considerations, Abbas has been unprepared to publicly confront the Palestinians with the fact that, if they truly seek freedom and independence, they will have to compromise on their maximalist demands, notably but not exclusively as regards the "right of return." In our interview here, Blair urges Israelis to undergo a "psychological shift" - from watching indifferently, skeptically, as the latest diplomatic effort unfolds, to making a determined effort for success on terms we can live with. But Israelis, in truth, are anything but indifferent; most recognize the imperative for a viable separation from the Palestinians; most recognize Israel's obligations, including the early honoring of the commitment to dismantle illegal outposts. The mainstream here, however, is highly skeptical - skeptical as to whether the Palestinians and the wider Arab world are ready for the psychological shift of genuinely reconciling to the Jewish state. Never has the need been as urgent as now for the region's relative moderates to come together with Israel and the Free World, in order to concertedly face down extremism. The run-up to Annapolis may represent the final opportunity for galvanizing such unity against the Iranian threat. But is the Arab world ready to accept Israel, even to help foster the alliance that can best protect it from Iran? The only essential condition is the same one that has been required from the Arab world for the close to 60 years of Israel's existence - acceptance of the legitimacy of Israel, the Jewish state. Make that fundamental psychological shift, and the path to progress immediately opens wide.- D.H.