By Sue Pleming WASHINGTON, Nov 23 (Reuters) - The United States hopes one byproduct of its Israeli-Palestinian peacemaking will be a moderate Arab alliance to counter Iran's influence in the region, but analysts are skeptical the strategy will work. U.S. Secretary of State Condoleezza Rice has argued that a strong Palestinian state could act as a bulwark against a rise in extremism, mainly from Iran, which Washington accuses of backing groups such as Hezbollah in Lebanon and Hamas in the Palestinian territories. Rice is hosting a Middle East peace conference in Annapolis on Tuesday and wants broad Arab "buy-in" as she tries to launch the first serious negotiations between the Israelis and the Palestinians for seven years. Rice was asked this week if ending the Israeli-Palestinian conflict had more to do with Iran than anything else. "It's a strange argument," she told reporters but she reiterated her view that growing extremism in the Middle East was a key factor driving the main players in the region to end the Israeli-Palestinian conflict. "I think they understand the broader threat of extremism in the region, and that extremists use this (Israeli-Palestinian) conflict," she said. Arab states have been pushing the Bush administration for years to be more active in Israeli-Palestinian peacemaking but there is skepticism about current U.S. intentions coupled with lingering Arab mistrust following the 2003 invasion of Iraq. While many Sunni Arab states shun Shia Iran's role in the region, they do not want to be associated with any U.S. "bullying efforts," said Bruce Riedel, a former analyst with the CIA. "They fear Iran. There is no doubt about it. But whether they want to be openly associated in this manner is another question," said Riedel, now with the Saban Center at the Brookings Institution, a Washington think-tank. ISOLATION COULD BACKFIRE While welcoming greater U.S. involvement, many analysts are curious why the Bush administration is only now connecting the Israeli-Palestinian crisis with other regional problems. "My first response is 'Good morning.' It took you seven years to recognize that," said Daniel Levy, a former Israeli negotiator now with the New America Foundation. U.S. policy has been to isolate both Syria and Iran but Levy said this could backfire when it came to getting Arab buy-in on Palestinian statehood negotiations. He urged the United States to be more inclusive, particularly with Syria, which has hinged its attendance at Annapolis on whether the Golan Heights, which was seized from it in 1967, is raised at the meeting. Senior State Department official David Welch said on Tuesday that Syria was welcome to express its views at the conference and Washington would not "turn off the microphone" at Annapolis if the Golan Heights was raised. "Iran, Syria, Hamas and Hezbollah are too powerful and they have too much ability to spoil it, to spoil any process," said Rob Malley of the International Crisis Group. "They have too much resonance on the Arab street to ignore," he added. Danielle Pletka, a vice president of the conservative American Enterprise Institute, was suspicious of any strategy that involved building up a moderate Arab alliance against Iran and cautioned against dealing with Syria. But former U.S. ambassador to Syria and Israel, Edward Djerejian, agreed with Rice and said progress on the Israeli-Palestinian front could help marginalize extremists. "The inter-connectivity of these issues is important but let me stress that the United States must address the Arab-Israeli issue on its own merits," said Djerejian, now director of the Baker Institute at Rice University in Texas. (Reporting by Sue Pleming, editing by Vicki Allen)
