Israel, Egypt Escalate a Nasty War of Words : Diplomacy: Despite 15 years of peace, mutual suspicion seems to underlie the bickering.

Israel and Egypt, after more than 15 years at peace, are caught up in nasty diplomatic skirmishing that has the Middle East wondering whether the region’s endemic suspicion and hostility can ever be overcome.

Egyptian President Hosni Mubarak is furious over Israeli Prime Minister Yitzhak Rabin’s recent comment that Israel needs to prepare for “an overall war” with the Arabs in the long or even medium term.

Rabin, meanwhile, is accusing Mubarak of hampering Israel’s peace negotiations with Syria and of slowing its rapprochement with other Arab countries to enhance Egypt’s position in the Middle East and to ensure himself a role as broker.

In a rapid escalation of the quarrel, the two leaders’ political advisers, generals and diplomats have weighed in with strong public statements and even sharper comments to the press. And, with official encouragement, the news media in both countries are turning it into a full-scale feud.

“The Israelis started it with their endless criticism about a ‘cold peace’ from us,” a senior Egyptian diplomat said in Cairo this month. “When we told them they weren’t so perfect and not all that lovable, they took it as a virtual declaration of war. . . . The whole thing has grown terribly out of hand.”

Although each side has specific complaints about the other, most reflect a residual mistrust despite a peace treaty signed in 1979--and a jockeying for position in the Middle East as the region works its way toward peace.

Egypt wants Israel to sign the Nuclear Non-Proliferation Treaty--and Israel is annoyed that Cairo is pressing it so hard by encouraging Arabs not to renew their adherence to the accord.

Israeli military intelligence questions Egypt’s need for such advanced U.S. weapons as F-16 warplanes, Apache helicopters and Abrams tanks. Egypt’s defense minister, Field Marshal Hussein Tantawi, tartly responds: “Israel appears to think that it is the only country with enemies, the only one with security needs.”

Egypt declares that, for peace with Syria, Israel will have to withdraw completely from the Golan Heights, which were captured in the 1967 Arab-Israeli War. Rabin rebukes Mubarak for encouraging Syrian President Hafez Assad and other Arabs to take “a hard line” in negotiations with Israel.

Israel says that Egypt discourages its businesses from dealing with Israelis, that Cairo newspapers will not publish Israeli advertisements and that even the government will not accept Israeli bids on contracts. Egyptian commentators reply that Israel wants to dominate the region’s economy.

Through all this, Egypt is asserting its leadership in the Arab world--and Israel is insisting that this influence will not come at its expense, even contending that Egypt’s position depends on their relationship.

As the criticism grew more acrimonious, the Israeli Foreign Ministry drew up a “planning document” that calls for a tougher line with Egypt, including a series of “forceful measures” such as a campaign in Washington to reduce U.S. aid to Egypt, the transfer of talks with the Palestine Liberation Organization out of Cairo and an end to the Egyptian mediating role in peace negotiations.

Publication of the document here in the influential newspaper Haaretz infuriated Egypt all the more. Foreign Minister Amir Moussa described it as moronic.

Israeli President Ezer Weizman, Foreign Minister Shimon Peres and his deputy, Yossi Beilin, all moved last week to calm the situation, assuring Egypt that the planning paper did not reflect government thinking and that, despite their differences, Israel greatly values its relationship with Egypt.

Weizman called Mubarak to say “the time has come to restore normal good working relations” and to set up a Mubarak-Rabin meeting. Peres wrote Moussa “a clarifying letter.”

“The exchange of accusations is out of all proportion with the real relations,” Beilin said, arguing that, in fact, “there has been a revolution in our relations with Egypt” since the peace agreement with the PLO in September, 1993. “After many years of cold peace, we now have something very different.

“Relations between Israel and Egypt are the cornerstone of all our Middle East relations,” he continued. “The peace process would have been impossible without our relations with Egypt. Egypt played a pivotal role in negotiations with the Palestinians. It is impossible to achieve peace in the Middle East without Egypt playing a very important role.”