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STEVE INSKEEP, host:

Secretary of State Condoleezza Rice met today with Israeli and Palestinian leaders. She wants both sides to show that they're prepared to take steps toward a just and lasting peace. This latest visit by Secretary Rice coincides with political turmoil in Israel and the likelihood of early elections. We're going to learn more now from NPR's Linda Gradstein who's in Jerusalem.

And, Linda, first the secretary of State met with Ariel Sharon, the Israeli prime minister, who faces some political trouble at home.

LINDA GRADSTEIN reporting:

That's right. The center-left Labor Party, which is Sharon's partner in the government coalition, met and elected a new party leader, a fiery trade union activist. And he had promised to pull the Labor Party out of the government perhaps as early as this week. If that happens, then Sharon's government will fall and there will be early elections probably sometime this spring. The date they're talking about is March or April. And then Sharon will have to decide whether he's going to continue in his Likud Party where he faces a challenge from former Prime Minister Benjamin Netanyahu, or split off and form a new more, perhaps, centrist party. And that's a decision he'll have to make. So the entire political system has really been kind of shaken up by all of this. And now early elections seem to be a question, not if they're going to happen, but when.

INSKEEP: Well, is Sharon then in position to make major moves in the peace process given that he's considering his own survival?

GRADSTEIN: Well, you know, that's certainly a question. Israeli officials and people close to Sharon say that he intends to pursue the peace process, that he's not going to put it on hold. But Israeli analysts say that, you know, if you've got an election campaign going on, it's unlikely that there will be major progress.

Also today, Secretary Rice met Palestinian leader, Mahmoud Abbas. She discussed the question of Hamas participating in elections. Yesterday, in a speech to a think thank that was meeting in Jerusalem, she demanded that the Palestinian Authority do more to crack down on terrorist groups. Here's what she said.

(Soundbite from speech)

Secretary CONDOLEEZZA RICE (State Department): Dismantling the infrastructure of terrorism is essential for peace because, in the final analysis, no democratic government can tolerate armed parties with one foot in the realm of politics and one foot in the camp of terrorism.

(Soundbite of applause)

INSKEEP: Well, Linda Gradstein, given these developments on both sides, are they making progress?

GRADSTEIN: Well, they are making progress. At the same time, there was more violence today when Israeli soldiers shot dead a senior member of Hamas in a pre-dawn raid in Nablus. Israeli officials said the 34-year-old Hamas leader tried to escape arrest. Hamas confirmed that he was a leader and threatened revenge.

In a separate incident, Israeli troops fired on three Palestinian gunmen near Israel's border with Gaza, killing one of them. And both Israeli and Palestinian officials say that a nine-month-old cease-fire is unraveling and, of course, each side is blaming the other for that.

INSKEEP: OK, that's NPR's Linda Gradstein in Jerusalem. Linda, thanks.

GRADSTEIN: Thank you.

INSKEEP: This is NPR News.

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