Israeli leaders fail to form emergency government

WEB EXCLUSIVE On the scene with Mike Hanna in Jerusalem

Palestinians say coalition would kill peace process

In this story: Barak's 'timeout,' Arafat's strong response Palestinians suspicious of Barak's motives Violence continues on the streets RELATED STORIES, SITES

CNN Jerusalem Bureau Chief Mike Hanna, CNN Cairo Bureau Chief Ben Wedeman, CNN Beirut Bureau Chief Brent Sadler, CNN White House Correspondent Kelly Wallace, and CNN Correspondents Jerrold Kessel, Fionnuala Sweeney and Rula Amin contributed to this report.

JERUSALEM (CNN) -- Israeli Prime Minister Ehud Barak and right-wing opposition Likud Party leader Ariel Sharon today failed to reach an agreement about forming a coalition government designed to keep Barak in power.

The two men met as Israeli-Palestinian clashes continued in Gaza and the West Bank. Two Palestinian teen-agers who were injured in fighting last week died Monday, putting the death toll at 135 people, mostly Palestinians, since September 28.

Sharon said the blueprint that Barak presented for a so-called unity government was "unacceptable," and they were expected to try again Tuesday.

VIDEO CNN's Jonathan Mann talks with Howard Sachar and Nur Masalha about the Mideast peace process Play video (QuickTime, Real or Windows Media) CNN's Rula Amin looks at Palestinian Authority President Yasser Arafat's reaction to developments in Israel (October 22) Play video (QuickTime, Real or Windows Media) CNN's Fionnuala Sweeney reports on clashes in the West Bank town of Ramallah after the Arab League summit (October 22) Play video (QuickTime, Real or Windows Media) CNN's Brent Sadler reports on the outcome of the summit in Cairo (October 22) Play video (QuickTime, Real or Windows Media) CNN's Jerrold Kessel reports on the continuing violence and Israel's response to the Arab League summit (October 22) Play video (QuickTime, Real or Windows Media)     AUDIO Barak responds to the declaration of the Arab summit and calls on the Palestinians to end the violence 633K/28 sec. AIFF or WAV sound Arafat reacts to Barak's decision to take a "timeout" from the peace process and says Barak can "go to hell" 340K/16 sec. AIFF or WAV sound Gilad Sher, senior Barak advisor, talks about the decision to take a "timeout" 588K/27 sec. AIFF or WAV sound Palestinian Cabinet Minister Hanan Ashrawi says Israel has no interest in peace 340K/16 sec. AIFF or WAV sound     MESSAGE BOARD Mideast peace     RESOURCES Mideast struggle for peace     ALSO Arab League stops short of call to end ties with Israel

Barak, who lost his parliamentary majority in July on the eve of the failed U.S.-hosted Israeli-Palestinian summit in Camp David, Maryland, has urged Sharon to join him in a national emergency government to deal with the wave of violence that has swept Israel, the West Bank and Gaza.

Barak has only 30 seats in the 120-member Israeli Parliament, which convenes again at the end of October. Although forming a unity government would allow Barak to remain in power, it would also create questions about when Israel would be willing to resume Palestinian peace talks and under what terms.

"Bringing in the Likud has two elements," Israeli Parliament Member Dan Meridor told CNN. "One, we are under attack. When we are under attack, we should unite. Second, bringing in the Likud is bringing in the party that made peace with Egypt, and bringing in Mr. Sharon, who negotiated with the Palestinians on the Wye (River) agreement and the Hebron agreement."

Saeb Erakat, chief Palestinian negotiator, saw it differently.

"I think once Sharon joins the government this will be the bullet of mercy to the peace process," Erakat told CNN. "Because ... these people are determined to continue with their settlement activities ... the confiscation of land and continuing occupation."

Meanwhile, Israel closed the Palestinian-operated airport in Gaza for what the government said were aviation rule violations, and not for punitive reasons.

The airport -- considered by Palestinians as a symbol of possible independence -- had been reopened as a result of a failed Israeli-Palestinian truce agreement reached at an emergency summit last week in Egypt.

Also reported in Gaza today were sporadic clashes between Israeli soldiers and Palestinians. Other Israeli-Palestinian clashes were reported in the West Bank in Bethlehem and near Hebron, where at least six Palestinians were injured.

Barak's 'timeout,' Arafat's strong response

On Sunday, Barak declared an Israeli "timeout" to reassess the peace process in the wake of a weekend Arab League summit in Egypt and continued Israeli-Palestinian fighting in the West Bank and Gaza.

Barak rejected what he called the "language of threats" issued toward Israel from the Cairo summit.

Palestinian Authority President Yasser Arafat said he "expected this" from Barak and indicated he had no intention of giving up his quest for Palestinian statehood.

"Our people [are] continuing the road to Jerusalem, the capital of our independent Palestinian state," Arafat said. "To accept or not to accept it, let him go to hell."

The Arab summit's final declaration denounced Israel, calling for a United Nations-led "war crimes tribunal" to try Israelis who the communique said were responsible for the recent violence.

However, the summit declaration stopped short of calling on Arab nations to sever ties with Israel, leaving that decision up to each Arab League country.

Participants in the emergency Arab summit lashed out at Israel for what they said was unjustified aggression, while they fully supported Palestinian resistance.

The participants also laid out a detailed plan for punitive diplomatic action. States with low-level economic or political ties to Israel -- such as Tunisia -- either will cut them off or review their relations.

But the summit's declaration fell far short of the demands of street demonstrators and militant leaders across the Arab world, who had called for measures ranging from a boycott of Israel to an all-out war.

"There are no more relations to be opened until they go back to the right path of peace," said Amr Moussa, the Egyptian foreign minister.

Egyptian President Hosni Mubarak, the summit host, said, "We live in a world in which all realize the suffering is not confined to one party and the flames of this conflict extend to all."

Libya's delegation walked out of the meeting Saturday, expressing disgust that Arab ties with Israel were being left largely intact.

The failure of the Arab leaders to take more stringent steps against Israel was condemned on the streets of Ramallah in the West Bank where Palestinians had been hoping for a clear, unequivocal statement backing their Intifada (uprising).

But Barak expressed outrage: "Israel rejects out of hand the language of threats that came out of the summit, and condemns the call for the continuation of violence which was implicit in the decisions," he said at the opening of Sunday's Israeli Cabinet meeting.

"We call on the Palestinians to respect their commitments to end the violence, to end the incitement and to allow a chance for calm and mutual coexistence, before continued violence leads to a deterioration -- the results of which cannot be foreseen," he added.

But some Palestinian leaders interpreted Barak's "timeout" as confirmation of their long-held suspicions about the Israeli prime minister's agenda.

The Palestinian chief of security, Muhammed Dahlan, said, "From the beginning, we believed Barak doesn't want peace. This decision of his has killed whatever had been left of the peace process ... which should be in the Israeli interest, not only a Palestinian one."

Palestinian Cabinet Minister Hanan Ashwari said, "It's clear Israel has suspended the peace process, despite the so-called moderation of the Arab world, because it has no interest in peace."

Other Palestinian leaders criticized Barak for unilaterally suspending the peace process and the impact they believed his announcement would have on the continuing violence.

Palestinian Cabinet Minister Yasser Abed Rabbu said, "He didn't have the right to do that, and, in spite of the peaceful message from the Arab summit ... his response was negative; this will only add more fuel to the situation."

Barak's announcement was seized on by the leader of the militant Islamic movement Hamas, Mahmoud Al-zahar, who said, "Hamas said from the beginning Israelis are not willing to make real peace. ... Now that was proved after nine years. ... The question is how to organize our activities against the occupation."

Senior Barak advisor, Gilad Sher, however, told CNN a timeout "doesn't mean the peace process is frozen."

Sher said, "It means that we have to think about and see whether and how we continue peace negotiations with the Palestinians."

Meanwhile, on the streets, the violence continued. Four Palestinians were killed Sunday in scattered clashes in the region, including a 14-year-old boy killed in fighting in Gaza.

Residents in Gilo, on the outskirts of Jerusalem, said they had been fired upon by residents in an adjacent Arab neighborhood.

Israeli security forces fired machine guns mounted on tanks into the Arab neighborhood, Beit Jala, and warned residents there to evacuate.

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