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Friday, October 5, 2001, 9:03 PM

Sharon's warning to US plays poorly at home

JERUSALEM, Oct 5 (AFP) - Israeli Prime Minister Ariel Sharon triggered a political storm Friday after his harsh warning to the United States not to form a coalition against terror with Arab states at Israel's expense.

"Don't try to conciliate the Arabs at our expense. We won't accept it," the hardline Sharon said at a press conference Thursday night.

The bullish speech was in reaction to US President George W. Bush's public endorsement Tuesday of a Palestinian state.

Bush's move indicated a change in course from the White House's hands-off approach to the Palestinian uprising since the Republican administration took office in January.

Washington's disinterest had amounted to an effective carte blanche for Sharon to pursue an iron-fisted military policy against the Palestinians, while paying mere lip service to the twin notions of a ceasefire and resumption of negotiations.

In light of the September 11 terrorist attacks on the World Trade Center and the Pentagon, Sharon had hoped to benefit from the US war against Saudi- born Islamic militant Osama bin Laden, the suspected mastermind.

However, the White House found its relationship with Israel to be a liability when it tried to persuade the Muslim states to join its fight against bin Laden, who resides in war-torn Afghanistan under the protection of the fundamentalist Taliban regime.

Arab nations raged at Bush for not intervening forcibly to halt Israeli violence and insisted on a more sympathetic US stance toward the Palestinians.

Meanwhile, Sharon overplayed his own hand by scuttling a planned September 23rd meeting between Israeli Foreign Minister Shimon Peres and Palestinian leader Yasser Arafat, in a bid to forge a ceasefire agreement.

In cancelling those talks, Sharon labelled Arafat Israel's "bin Laden" and drew new pressure from Washington to let the meeting to go ahead, which it did three days later.

Unhappy, the former general hit back at Bush on Thursday night in a speech laced with references to Nazi Germany and by implication the World War II Holocaust of Europe's Jews.

"I call upon the Western democracies, and first of all the United States as the head of the free world, not to commit again the terrible mistake made in 1938 when European democracies sacrificed Czechoslovakia for a temporary solution," Sharon said.

"Israel will not be Czechoslovakia," he said.

At the 1938 Munich conference, European powers yielded to German dictator Adolf Hitler and allowed him to take over part of Czechoslovakia to appease the Nazi regime. World War II started a year later.

According to an Israeli official, Sharon's speech aimed to rally the powerful Jewish community in the United States against Bush.

"Ariel Sharon played the note of the threat of a new Holocaust," the official told AFP on condition of anonymity.

"It is also a way to express his anger at the Americans' refusal to include Hamas, Islamic Jihad and Hezbollah on the list of organisations targetted in their war against terrorism," he said, alluding to Islamic groups that have attacked Israel with suicide bombers or guerrilla operations.

Left-wing opposition leader Yossi Sarid blasted Sharon's speech, calling it "groundless, miserable, uncalled-for and dangerous.

"They are something of a show of ingratitude to America, without which Israel would have a hard time surviving, and they are also a very serious diplomatic error," he said.

Newspapers also offered scathing criticism.

"Yesterday Prime Minister Ariel Sharon set a record in self-alarmism. In a very short speech to the nation, Sharon warned the free world not to 'sacrifice Israel' to appease the Arabs, as Czechoslovakia was sacrificed on the eve of World War II to appease Nazi Germany," warned Yediot Aharonot, Israel's top-selling daily.

"This was an unfortunate statement, historically mistaken, politically damaging, factually incorrect, and it deepens the sense of threat and strangulation that Israelis feel. It weakens us and insults our friends."

White House fury over Sharon jibe

Friday, 5 October, 2001, 14:41 GMT 15:41 UK

Washington has condemned as "unacceptable" Israeli Prime Minister Ariel Sharon's accusation that the US is appeasing Arab states in order to gain support in its war on terrorism. Mr Sharon had compared the treatment of Israel with events leading up to World War II, when Britain and France helped Nazi Germany dismember Czechoslovakia.

"Those comments made by the prime minister are unacceptable in the president's opinion," said President Bush's spokesman, Ari Fleischer.

He added that Mr Sharon had been informed of the US response to his comments through the US embassy in Israel.

Friday October 5, 2001, 10:26 AM ET

White House Rejects Sharon Criticism

WASHINGTON (AP) - The White House on Friday criticized Israeli Prime Minister Ariel Sharon for accusing the Bush administration of appeasing Palestinians in a bid to bolster Arab support for counterterrorism.

``Israel has no stronger friend and ally in the world than the United States,'' said White House spokesman Ari Fleischer. ``President Bush is an especially close friend of Israel. The United States has been working for months to press the parties to end the violence and return to a political dialogue. The United States will continue to press both Israel and the Palestinians to move forward.''

On Thursday, Sharon vowed in a Tel Aviv news conference that ``Israel will not be Czechoslovakia. Israel will fight terrorism.'' He likened Bush administration Mideast policies to the submission of European democracies, on the eve of World War II, to Adolf Hitler's demands to take over Czechoslovakia.

``Do not try to appease the Arabs at our expense,'' Sharon said.

Fleischer responded: ``The prime minister's comments are unacceptable.'' He said Bush was unhappy about it, and the president's displeasure was communicated to Israel through officials in the U.S. Embassy in Israel, the National Security Council and the State Department.

He said the Bush administration particularly objected to Sharon's saying that the United States was acting at Israel's expense. ``The United States is not doing anything to try to appease the Arabs at Israel's expense,'' Fleischer said.

Hours after Sharon spoke, Israeli troops backed by tanks seized two Palestinian neighborhoods in Hebron, killing five Palestinians and marking the virtual end of a cease-fire both sides agreed to last month

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