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Any approach other than the one that Bush is taking now (and Clinton took previously) would be utterly ineffective. The thing you have to remember about the current situation in the Middle East is that Israel is NOT being invaded by outsiders. These suicide bombers live in the West Bank or Gaza Strip (or even in Israel itself), so Israel is in a very difficult position. Israel cannot have it both ways -- it must either insist that these territories are part of Israel (and deal with the inhabitants of these territories) or cast them off and allow the creation of a separate Palestinian state. The cost of the first option is prohibitive in financial terms, and the cost of the second option is prohibitive in political terms. The second option is more likely, which means that Israel's best interests are served if this Palestinian state has a nominal leader (Arafat) who is familiar to all of the players involved.