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In an exclusive, wide-ranging interview, his first since becoming a government minister on March 31, which will be published in Friday's Upfront magazine, the former IDF chief of General Staff said Iranian President Mahmoud Ahmadinejad's appearance at the UN conference on racism in Geneva last week was reminiscent of the way the world treated Nazi Germany in the 1930s.
"I have no doubt that the Iranians will use any dialogue to stall for time if there will not be a clear time frame and clear benchmarks like telling them that they have two months to stop the enrichment," Ya'alon said.
"These are the type of benchmarks that can test the Iranians, since anything else will be a waste of time.
This time will be used by the Iranians to continue to move towards a nuclear military capability."
The West has to understand that it needs to confront the Iranians and cannot make concessions, he said.
"What is happening between the Western world and the Islamic jihadists of Iran is a process that is built on previous surrenders and concessions," he said. "What the West needs to do is stand up against this wave and confront it."
Regarding the Palestinian conflict, Ya'alon stressed several times throughout the interview the PA's refusal to recognize Israel as a Jewish state.
He said that even at the Annapolis Conference in November 2007, Palestinian Authority President Mahmoud Abbas refused to insert the words "two states for two peoples" into the mutual statement and only allowed the words "two states."
"That is why the prime minister says that we want them to recognize Israel's right to be a Jewish state," he said. "This right does not depend on them but if they don't recognize it then there is nothing to talk about."
Ya'alon also rejected the Saudi initiative, which calls for an Israeli withdrawal to the pre-1967 borders.
"From our perspective, the pre-1967 borders are not defensible. To go onto this track is dangerous. I am in favor of doing things that are creative, but not this way," he said.
The government, he said, was currently completing its policy-evaluation and supported a "bottom-up" approach to the conflict under which, as a first step, the Palestinians would need to implement serious education, political, security and economic reforms.
Ya'alon refused to comment on whether the IDF could stage an effective strike against Iranian nuclear facilities.
"We need to hope that the job will be done by someone else and at the same time, as the Talmudic sage Hillel said, 'If I am not for myself who will be?'" he said.
Despite US Secretary of State Hillary Clinton's statements last week that Israel runs the risk of losing Arab support for combating threats from Iran if it rejects peace negotiations with the Palestinians, Ya'alon said he rejected such linkage, calling it "superficial."
"I believe that this whole idea is wrong at its core," he said.
"Firstly, if you solve the Israel-Palestinian conflict it will not stop or even soften the Islamic jihadists. The Islamic Revolution [in Iran in 1979] did not erupt because of us. Al-Qaida was not created because of us and even Hizbullah did not rise up because of us."
What was needed was for the West, led by America, to "confront" Iran, and if the US decided to conduct a dialogue or impose additional sanctions, to do so while holding a "stick of military pressure," Ya'alon said.
"The fact is that in 2003, Iran stopped its program without being attacked. This was basically due to a combination of diplomatic pressure and the threat of sanctions, but mainly due to the threat of military action," he said.
Despite predictions that the policies of the Netanyahu government will create a clash with the Obama administration, Ya'alon said he did not recall a single incident during his adult life of Washington imposing something on Israel that undermined its security interests.
On Sunday, Ahmadinejad said that while Iran believed "in talking, in negotiating, based on sincerity, respect and justice," Teheran would not hold talks with the Obama administration unless "a clear-cut framework" and a "clear agenda" were agreed upon beforehand.