Hey! How did my name get pulled in with the Lebanese?
Well, Sander, I think that this argument about whether democracy is best for the middle east needs to be explored a bit empirically. If you compare countries in the middle east in terms of quality of life issues for their inhabitants, I think the non-democracies will come up pretty thin. Much of what success you find in the middle east is not due to regime type but oil an population.
And this is a pretty interesting correlation- if you compare the state looking at oil and population you will probably find that where the state has a small population and oil, you find prosperity- Saudi Arabia, OAE, Kuwait. When you find oil and large populations you find brutal dictatorships and often civil conflict- Libya, Algeria, Iraq, Iran. If you factor oil out of the picture, you will often find states that had historically strong leanings towards a foreign patron (USSR- Syria and Yemen) or the US (Iran -although it has oil, Pakistan, Egypt- which switched sides in the 1970s).
Israel has had prosperity and democracy. There was a picture going around of countries at night. If you look at the middle east its pretty dark, except in Israel. Much of that is because Israel gets a lot of money from abroad.
That said, I would have to disagree with other points. Jerusalem has been an important city for the Muslims for a long time. It's strategic significance is seen time and again during the period of the Crusades, for example.
I think that the argument that the US will continue to have terrorism problems as long as the Palestinian- Israeli problem lingers is valid. I would also agree that the US should not have its foreign policy in the middle east hijacked by the Israelis.
The Israelis don't have a great record on a number of issues, and their position in Palestine is often seen by much of the developing world as a vestige of colonialism. Some of the policies of Sharon leave a lot to be desired. Now they are thinking about 'removing' Arafat, support for settlements on the west bank, and the big wall they are building. Not exactly the road to peace. This is why you often see Israel being condemned by other countries at the UN.
As I see it the problem is Israel is a game in which the parties to the extreme of both the Palestinians and the Israelis are working against peace in pursuit of their own interest. As long as you have folks with significant political pulll who want to build settlements on the west bank (your Jewish religious extremists) or the extremists on the other side (Palestinian groups that argue that any presence other than Islam is an afront to their faith) then you will have trouble. At one point I was unsure if Arafat could control the Islamic militants, but with time I think he either won't or doesn't want to.
Frankly, considering the Israel's willingness to assassinate, I am amazed he's lasted this long.