DON'T GET YOUR HOPES UP yet for a peace settlement between Israel and the Palestinians. Yasser Arafat, the Palestinian president, has allowed the new prime minister, Mahmoud Abbas, to form a governing cabinet. And Abbas's emergence represents a shrinking of Arafat's authority. But Arafat has lost only a bit of his power. He retains a virtual veto over any steps Abbas may want to take, plus the right to fire Abbas at any time. Which means that the chief Palestinian impediment to peace, Arafat, is still in a position to impede.

Let's review Arafat's recent record. At Camp David in 2000 and again at the White House in January 2001, Arafat was offered generous terms for a settlement, including half of Jerusalem, nearly 100 percent of the West Bank, a dramatic reduction in Israeli settlements, and a land bridge between Gaza and the West Bank. Some of Arafat's aides favored acceptance, but he said no to President Clinton and Ehud Barak, the Israeli prime minister, and then brought on a new intifada and a string of suicide bombings in Israel.

This militant refusal led to Ariel Sharon's victory over Barak in the ensuing Israeli election and, in June 2002, to President Bush's decision to halt any American dealings with Arafat and to urge his removal from power. The new Bush policy weakened Arafat, who was forced to name a prime minister, Abbas (also known as Abu Mazen). But the negotiations over Abbas's cabinet show that Arafat remains powerful.

The cabinet crisis occurred after Bush and British prime minister Tony Blair announced last month that a so-called road map of directions toward an Israeli-Palestinian accord would be released after Abbas and his cabinet were sworn in (which may happen next week). The road map was produced by the "quartet" of the United States, the European Union, the United Nations, and Russia.

Abbas succeeded in getting Arafat to accept Muhammad Dahlan as a top security official in the cabinet--Dahlan has been publicly critical of Arafat. But Abbas was forced to accept three of Arafat's allies to top positions, men Abbas had hoped to relegate to minor posts.

Abbas himself is often described as a moderate, at least relative to Arafat. He has said that the intifada begun by Arafat in 2000 was a mistake. The question now is what Abbas will be able to achieve. He gives the Palestinians a figure to meet with American officials who won't deal with Arafat. Secretary of State Colin Powell is expected to confer with Abbas when he travels to the Middle East as early as next week.

Despite the 3-year timetable in the road map, results are more important than deadlines. For Abbas, this means at the outset cracking down on Palestinian terrorists--the Al-Aksa Brigades, Hamas, Islamic Jihad. If he succeeds--if Arafat doesn't undermine his efforts--then Israel will be under pressure to make concessions. Sharon has already indicated a willingness to reduce Israeli settlements on the West Bank. If Abbas fails in suppressing terrorists, no peace is possible.

Will Arafat allow a serious crackdown? Will he give Abbas a free hand in negotiating with the Israelis? Will, in fact, Arafat permit any steps by Abbas that would reduce his own power? Arafat's record suggests the answer is no to these important questions.

But he didn't want to name a prime minister or compromise on a cabinet, either. He relented under pressure from two sources that usually don't hold him accountable: Egypt and the Europeans. Tony Blair is a key figure here. If only to appease the Labour left, he's been kindly disposed toward Arafat, in effect legitimizing him. Now's the time, however, to legitimize Abbas and let Arafat go. Otherwise, the road map won't matter and Arafat will be free to block peace once more.

Fred Barnes is executive editor of The Weekly Standard.

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