Now, as for Israel, if history has taught the Jewish people anything, it is that we must take calls for our destruction seriously.
We are a nation that rose from the ashes of the Holocaust. When we say never again, we mean never again. (Applause.) Israel always reserves -- (applause) -- Israel always reserves the right to defend itself. (Applause.)
My friends, while Israel will be ever-vigilant in its defense, we'll never give up our quest for peace. I guess we'll give it up when we achieve it. (Applause.) Because we want peace. Because we need peace. Now, we've achieved historic peace agreements with Egypt and Jordan, and these have held up for decades.
I remember what it was like before we had peace. I was nearly killed in a firefight inside the Suez Canal -- I mean that literally -- inside the Suez Canal.
And I was going down to the bottom with a 40-pound pack -- ammunition pack -- on my back, and somebody reached out to grab me.
And they're still looking for the guy who did such a stupid thing. (Laughter.) I was nearly killed there. And I remember battling terrorists along both banks of the Jordan.
Too many Israelis have lost loved ones, and I know their grief. I lost my brother. So no one in Israel wants a return to those terrible days.
The peace with Egypt and Jordan has long served as an anchor of stability and peace in the heart of the Middle East. (Applause.) And this peace -- this peace should be bolstered by economic and political support to all those who remain committed to peace. (Applause.) The peace agreements between Israel and Egypt and Israel and Jordan are vital, but they're not enough. We must also find a way to forge a lasting peace with the Palestinians. (Applause.)
Two years ago, I publicly committed to a solution of two states for two peoples -- a Palestinian state alongside a Jewish state.
(Applause.) I'm willing to make painful compromises to achieve this historic peace. As the leader of Israel, it's my responsibility to lead my people to peace. (Applause.)
Now, this is not easy for me. It's not easy, because I recognize that in a genuine peace, we'll be required to give up parts of the ancestral Jewish homeland. And you have to understand this: In Judea and Samaria, the Jewish people are not foreign occupiers. (Cheers, applause.)
We're not the British in India. We're not the Belgians in the Congo. This is the land of our forefathers, the land of Israel, to which Abraham brought the idea of one god, where David set out to confront Goliath, and where Isaiah saw his vision of eternal peace. No distortion of history -- and boy am I reading a lot of distortions of history lately, old and new -- no distortion of history could deny the 4,000-year-old bond between the Jewish people and the Jewish land. (Sustained applause.)
But there is another truth. The Palestinians share this small land with us. (Applause.) We seek a peace in which they'll be neither Israel's subjects nor its citizens. They should enjoy a national life of dignity as a free, viable and independent people living in their own state. (Applause.) They should enjoy a prosperous economy, where their creativity and initiative can flourish.
Now, we've already seen the beginnings of what is possible. In the last two years, the Palestinians have begun to build a better life for themselves. By the way, Prime Minister Fayyad has led this effort on their part, and I -- I wish him a speedy recovery from his recent operation. (Applause.)
We've helped -- on our side, we've helped the Palestinian economic growth by removing hundreds of barriers and roadblocks to the free flow of goods and people, and the results have been nothing short of remarkable. The Palestinian economy is booming; it's growing by more than 10 percent a year. And Palestinian cities -- they look very different today than what they looked just a few years -- a few years ago. They have shopping malls, movie theaters, restaurants, banks.
They even have e-businesses, but you can't see that when you visit them. (Scattered laughter.)
That's what they have. It's a great change. And all of this is happening without peace. So imagine what could happen with peace. (Applause.)
Peace would herald a new day for both our peoples, and it could also make the dream of a broader Arab-Israeli peace a realistic possibility. So now, here's the question. You've got to ask it: If the benefits of peace with the Palestinians are so clear, why has peace eluded us? Because all six Israeli prime ministers since the signing of the Oslo Accords agreed to establish a Palestinian state, myself included; so why has peace not been achieved?