With the McConnell Center, you have inspired a new generation with the same reverence for civic participation and community conscience that you have exemplified during your own quarter century of service to your state and to your nation. Thanks to you, the McConnell scholarships have provided over $1 million to help prepare Kentucky's and America's future leaders to meet the challenges of the 21st century.

And I will have to pause, Mitch, and thank you especially for the support that you and your committee and your colleagues in the Congress have given me over the last 10 months, to help me equip the State Department to carry out the foreign policy of the American people in the 21st century. That support has been an enormous inspiration to me as well as an inspiration to the Department.

Ladies and gentlemen, I have to tell you that it has been my privilege to work with Senator McConnell for many years. He is time tested, battle ready. I have admired throughout all those years his tireless support for democracy around the world. Indeed, America has no greater ambassador for democracy than Mitch McConnell and you should be proud of his service on your behalf. Thank you once again. (Applause.)

President Schumaker, Provost Garrison, Professor Gregg, McConnell scholars, distinguished guests, ladies and gentlemen, I would like to thank the faculty of the University of Louisville, the board of trustees, President Schumaker and those who nominated me for honoring me with this degree. The slogan of the University of Louisville is "Dare to be great." President Schumaker, you and your faculty are instilling in your students the drive for excellence that underpins our success as individuals in life and as a nation. And I am proud now to be a Louisville Cardinal, along with all the rest of you here today. (Applause.)

And, by the way, congratulations to all of us Cardinals for another Conference USA championship and, now on to the Liberty Bowl. (Applause.) And you whupped up on those folks 92 to 38 last night. That ain't right. (Laughter.)

It's also great to be back in Louisville, a city that I have always enjoyed visiting. Before I became Secretary of State, I was Chairman of America's Promise, the Alliance for Youth, an organization, a crusade that has as its mission to build the character and confidence of America's young people. And I came to Louisville four years ago in that capacity to congratulate Mayor Abramson and the city for the great work that Louisville had been doing for its young people. It was one of our very, very best Communities of Promise.

And I especially remember at that time, Jerry gave me one of those huge, oversized Louisville Slugger baseball bats. And I was deeply appreciative of that. I still keep it in my office. And, believe me, it comes in handy late at night, when I've had enough diplomacy for one day and I want to hit somebody. (Laughter.) So I thank you, Jerry, and it's good to see you here in the audience.

Ladies and gentlemen, the McConnell Center is all about leadership and that is why I am here today, to talk to you about American leadership in today's world. We don't need reminding that America's leadership in the world today is vitally important. It is now 69 days since September 11th, when cold-blooded terrorists turned civilian airliners into flying bombs and used them to kill 5,000 innocent people. That is four or five times the number of people who are assembled here today.

Every one of us was affected by what happened on the 11th of September. Some of us lost loved ones, like your great basketball coach, Rick Pitino, who tragically lost his brother-in-law in the World Trade Center. Others of us merely lost our innocence. We can never look at a jetliner flying in a clear blue sky the same way again.

Under President Bush's leadership, we have responded to this outrage against civilization. We have quickly assembled a remarkable coalition of countries. Almost every country in the world except for one or two are part of this coalition. And that coalition came together and launched a full-scale campaign against al-Qaida, the terrorist conspiracy that attacked us, and its ring leader, Usama bin Laden.

To get to terrorists, we had to go after the Taliban regime in Afghanistan that was protecting them. We warned them. We warned the Taliban to turn over bin Laden or we would make them pay. They refused, and we have now made them pay. (Applause.) We have driven them from power, and I know that all of you are as proud as I am of the brave men and women of our armed forces and our intelligence services who made that success possible. Those kids are just great, and we all need to be proud of them. (Applause.)

But this war is not over, and our troops will carry on the fight until al-Qaida is destroyed. I hope that all of you will keep those wonderful GIs in your prayers this Thanksgiving week.

As we continue our campaign against the terrorists of September 11th, let me make one point crystal clear. These murderers did not act on behalf of Muslims or on the behalf of the poor and downtrodden of the world, or on behalf of Palestinians. Their terror was indiscriminate. The murderers of September 11th killed people of all faith -- Muslims and Jews, Christians and Hindus. Muslim leaders around the world have condemned these attacks. Leading Islamic groups have joined distinguished Muslim scholars in rejecting bin Laden's efforts to cloak himself in Islam.

Nor do the terrorists speak for the Palestinians, whose leaders have rejected bin Laden's attempt to hijack their cause for his murderous ends. No, these criminals have no religion, and they have no human cause. Their goal, and the goal of all like them, is to divide and embitter people. They are evil merchants of death and destruction.

To understand the true faith of al-Qaida and the Taliban, all we have to do is look at the way they hijacked Afghanistan. The Taliban squeezed the life out of Afghanistan -- no music, no soccer, no education or jobs for women, nothing -- nothing but total support to Usama bin Laden and his gang of al-Qaida murderers. Now, in recent days, as the curtain has been lifted, we have seen on television the joyous pictures of liberated Afghans, of women throwing off their burqas, children happily flying kites. Last night, we saw the television station start broadcasting again, with two women and a man not only giving out the news, but reading the Koran to those who could listen for the first time in years.

Compare the Taliban's depredations with the response of the international community to the plight of the Afghan people. We are feeding millions of Afghans put at risk by drought, famine and Taliban misrule. Before we were able to go in on the ground, we dropped food from the air. Now we are using airplanes, trucks, barges, even donkeys -- anything that will get food in to these destitute people before the winter arrives in force. We should be proud that the United States, our country, is the largest contributor to this effort to help the desperate Afghan people, and we will do more.

We are not stopping there. We are working with the international community and the Afghan people to help them rebuild their country. Tomorrow, back in Washington, I will kick off the first international Afghan reconstruction meeting to achieve this purpose.

We are also working with the United Nations to help the Afghans form a new government, one that represents all geographical and ethnic backgrounds, one that will end Afghanistan's role as a haven for terrorists and drug dealers, one that will permit reconstruction and allow these millions of refugees to return home in peace and security.

One message that leaps out from the events of September 11th is very clear. American leadership in foreign affairs has never been more important. And job one for American leadership in this period is the fight against terrorists.

As President Bush told a joint session of Congress September 20th, our war on terror will not end until every terrorist group of global reach has been found, stopped and defeated. My friends, we know it will take time. It will take effort. We will be patient. We will be persistent. And I can assure you that, under President Bush's leadership, we will not rest until the job has been done and civilization is safe again. (Applause.)

While the fight against the terrorists is our top priority, it is not our only priority. In these first years of the 21st century, we have other interests too important to ignore. In fact, as President Bush has said, winning the war against terrorism will create new opportunities to use American leadership and power to make the world safer, freer and more prosperous. Whether by bolstering free trade, dealing with problems in the Middle East and other regions, or strengthening relations with key countries, we will seize these opportunities for the benefit of the American people and for the benefit of the world.

We saw an example of that last week when President Bush hosted Russia's President Putin at the White House and then down at his ranch in Crawford, Texas. Those two places, the two presidents spoke on the unprecedented cooperation Russia has given us since September 11th. President Putin was the first foreign leader to call President Bush and not just to offer sympathy and condolences, but to offer help, to align Russia with us in this new campaign against terrorism.

President Bush and President Putin are creating a new US-Russia relationship, based on finding areas for more cooperation, on counterterrorism, of course, but also on reducing the number of nuclear weapons in our inventories, and by taking steps to strengthen the Russian economy to allow them to draw more to the West and become part of the Euro-Atlantic partnership.

And notice the two, security and economic development. Because with security must come economic development and prosperity. I believe that in this new century, American economic leadership has the potential to lift tens of millions of people out of poverty. When I was in China a few weeks ago, accompanying President Bush to a meeting of Asian and Pacific leaders, I was amazed at how the city of Shanghai had grown compared to the Shanghai that I had visited some 30 years earlier.

China's remarkable growth of the past two decades has come from investing the savings of the Chinese people, from the capital of foreign businesspeople, and from the profits earned by Chinese exporters. At the same time, China's growth benefits American consumers, the average American citizen, who can find good value in a Chinese product at a local store. This kind of two-way trade helps everyone, benefits both societies. And that's why free trade is so important, and that's what free trade is all about.

In this same way, freer trade will help other economies -- in Asia, in Africa, in Europe, in our own hemisphere, in the Americas -- all of them being given the opportunity to create the jobs needed to lift more of their people out of poverty and out of despair. Trade is good for all of us, producers and consumers alike, and that is why we were so pleased to see China, as well as Taiwan, become members of the World Trading Organization earlier this month.

And that is why American leadership, in launching a new round of global trade negotiations, was so important. In a meeting last week in Doha, Qatar, United States Trade Representative Bob Zoellich and his team did a magnificent job in clearing the way to new talks on global trade. President Bush is totally committed to free trade. But to conclude the trade agreements that benefit us, the kind of trade agreements that we need, we very badly need Congress to pass trade promotion authority as soon as possible.

With trade promotion authority, the President's team negotiates an agreement with another country, which Congress then votes to accept or reject as a whole. That way, our negotiating partners are more willing to make the hard compromises and choices they need to make, knowing that the agreements they do make with us will not be reopened when those agreements go before Congress.

So we want more and more of these kinds of agreements, and more and more open trade in order to take advantage of this 21st century time of hope and opportunity, a time for determined American leadership, political leadership, diplomatic leadership and economic leadership, the kind of leadership that President Bush is giving to the nation and giving to the world.

It is also a time of danger and a time of challenges requiring American leadership. And nowhere are the challenges greater than in the Middle East, a region where we have fought long for our most basic values and principles, a region where we have stood by our friends, Arab and Israeli, in war and in peace, for over half a century.

Since Israel's establishment over 50 years ago, the United States has had an enduring and ironclad commitment to Israel's security. The United States-Israeli relationship is based on the broadest conception of American national interests, in which our two nations are bound forever together by common democratic values and traditions. This will never change.

One of my proudest moments as a soldier and as an American came in 1991, when American troops led the international coalition of forces that liberated Kuwait from Saddam Hussein's invaders. Later that year, though, I watched with equal pride as Arabs and Israelis gathered together in the aftermath of the Gulf War. They gathered together in Madrid to take advantage of the opportunity created by the successful war. They took the opportunity to launch an historic process of negotiations aimed at ending their conflicts once and for all. They, too, were supported by an American-led coalition, one focused this time on peace rather than on war.

The Middle East is a region facing enormous problems. The hope created in Madrid has faded. Last month marked the tenth anniversary of the Madrid conference, a time to look forward as well as look back. We are looking forward now as we try to capture the spirit of Madrid and create a renewed sense of hope and common purpose for the peoples of the Middle East. America has a positive vision for the region, a vision that we want to share with our friends in Israel and in the Arab world.

We have a vision of a region where Israelis and Arabs can live together in peace, security and dignity. We have a vision of a region where two states, Israel and Palestine, live side by side within secure and recognized borders. We have a vision of a region where all people have jobs that let them put bread on their tables, provide a roof over their heads and offer a decent education to their children. We have a vision of a region where all people worship God in a spirit of tolerance and understanding. And we have a vision of a region where respect for the sanctity of the individual, the rule of law and the politics of participation grow stronger day by day.

Such a vision seems far away today. Throughout much of the Middle East, the economic challenges are daunting. Too little economic growth creates too few jobs for burgeoning populations. And too much red tape and government control stifle private enterprise and initiative.

Throughout much of the region, political systems do not provide citizens an adequate say in how they are governed. They do not offer a way for people to peacefully work out competing needs and visions for their future.

The solutions to these challenges will come about only through hard work, common sense, basic fairness and a readiness to compromise. They will not be created by teaching hate and division, nor will they be born amidst violence and war.

To help America recognize this positive vision, we will stay engaged. America wants to recognize its positive vision and help all in the region to achieve this positive vision. America will continue to strongly support expansion of economic opportunity in the region, political openness and tolerance, will support efforts to find regional solutions to security challenges, and we will conduct serious diplomacy aimed at resolving regional conflict. The Middle East has always needed active American engagement for there to be progress, and we will provide it, just as we have for over half a century.

The central diplomatic challenge we face in the Middle East is to obtain a just and lasting peace between Israel and its Arab neighbors. Until Israel and all of its neighbors are at peace, our vision of the Middle East at peace will only be a distant dream. President Bush and I are convinced that the Arab-Israeli conflict can be resolved, but that will only happen if all of us, especially Israelis and Palestinians, face up to some fundamental truths.

To begin with, Palestinians must accept that, if there is to be real peace, Israelis must be able to live their lives free from terror as well as war. The Palestinian leadership must make a 100 percent effort to end violence and to end terror. There must be real results, not just words and declarations. Terrorists must be stopped before they act. The Palestinian leadership must arrest, prosecute and punish the perpetrators of terrorist acts. The Palestinians must live up to the agreements they have made to do so. They must be held to account when they do not.

Whatever the sources of Palestinian frustration and anger under occupation, the Intifada is now mired in the quicksand of self-defeating violence and terror directed against Israel. Palestinians need to understand that however legitimate their claims, they cannot be heard, let alone be addressed, through violence. And as President Bush has made clear, no national aspiration, no remembered wrong can ever justify the deliberate murder of the innocent. Terror and violence must stop and stop now. (Applause.)

Palestinians must realize that the violence has had a terrible impact on Israel. The lynching of Israeli soldiers in Ramallah, the assassination of the cabinet minister and the killing of Israeli children feed Israelis' deepest doubts about whether Palestinians really want peace. The endless messages of incitement and hatred of Israelis and Jews that pour out of the media in so much of the Palestinian and Arab worlds only reinforce these fears. No one can claim a commitment to peace while feeding a culture of hatred that can only produce a culture of violence. The incitement must stop.

Palestinians must accept that they can only achieve their goals through negotiation. That was the essence of the agreements made between Israelis and Palestinians in Madrid, and again in Oslo in 1993. There is no other way but direct negotiation in an atmosphere of stability and non-violence.

At the same time, Palestinians must also be secure and in control of their individual lives and collective security. In the absence of peace, Israel's occupation of the West Bank and Gaza has been the defining reality of Palestinians' lives there for over three decades, longer than most of the Palestinians living there have been alive.

The overwhelming majority of Palestinians in the West Bank and Gaza have grown up with checkpoints and raids and indignities. Too often they have seen their schools shuttered and their parents humiliated. Palestinians need security as well. Too many innocent Palestinians, including children, have been killed and wounded. This, too, must stop. (Applause.)

The occupation hurts Palestinians, but it also affects Israelis. The sad truth is that it is the young people who serve on the front lines of conflict who are at risk. Embittered young Palestinians throw stones, and young Israeli soldiers on the other side learn only that Palestinians are to be feared, seen as enemies. One thing I've learned in my life is that treating individuals with respect and dignity was the surest path to understanding. Both sides need to treat the other with respect. Humiliation and lack of respect are just another path to confrontation.

Israeli settlement activity has severely undermined Palestinian trust and hope. It preempts and prejudges the outcome of negotiations and, in doing so, cripples chances for real peace and security. The United States has long opposed settlement activity. Consistent with the report of the committee headed by Senator George Mitchell, settlement activity must stop.

For the sake of Palestinians and Israelis alike, the occupation must end. And it can only end with negotiations. Israelis and Palestinians must create a relationship based on mutual tolerance and respect so negotiations can go forward.

My friends, it should be clear from these realities that the way back through a political process will be neither quick nor easy. That's the bad news. The good news is that a framework for a solution exists. It is based on the core principles of the United Nations Security Council Resolutions 242 and 338, which are rooted in the concept of land for peace. Madrid also calls for a comprehensive Arab-Israeli peace, including agreements with Syria and Lebanon.

Rejectionists say that there has been no progress over the years trying to achieve those objectives. They are wrong. Over the past decade, Arabs and Israelis have proven that negotiations can work and can achieve results. At Madrid in October of 1991, through the Oslo process beginning in 1993, and in the 1994 Israeli-Jordanian peace treaty. And, last year, there was hope as Israelis and Palestinians negotiated on permanent status issues. The questions proved excruciatingly difficult, but issues long avoided were finally addressed.

After a year of violence and trauma, finding a way forward will not be easy. It will take time, it will take trust. But the tools to rebuild confidence and revive a political process are available and they are available now. They are found in the security work plan negotiated by CIA Director George Tenet, and the Mitchell Committee report, which both the Government of Israel and the Palestinian Authority have accepted, and which the entire international community has strongly endorsed.

The steps they outline offer Israelis and Palestinians a roadmap to a cease-fire and an end to the violence. Such steps must include an end to closures in order to bring tangible improvement in the daily lives of Palestinians and the rapid restoration of economic hope into every Palestinian home. Implementation of the Mitchell report shows the way to restoring trust and confidence and moving rapidly to the resumption of negotiations.

We will do all we can to help the process along. We will push, we will prod. We will present ideas. For example, there are a number of economic and political steps in existing agreements --they are there now -- which, if we implemented, could contribute to momentum toward peace. But notwithstanding everything we do, at the end of the day, it is the people in the region taking the risks and making the hard choices who must find the way ahead. The only lasting peace will be the peace the parties make themselves.

Both sides will need to face up to some plain truths about where this process is heading as they turn to the challenges of negotiating permanent status issues. Palestinians must eliminate any doubt, once and for all, that they accept the legitimacy of Israel as a Jewish state. They must make clear that their objective is a Palestinian state alongside Israel, not in place of Israel, and which takes full account of Israel's security needs.

The Palestinian leadership must end violence, stop incitement and prepare their people for the hard compromises ahead. All in the Arab world must make unmistakably clear, through their own actions, their acceptance of Israel and their commitment to a negotiated settlement.

Israel must be willing to end its occupation, consistent with the principles embodied in Security Council Resolutions 242 and 338, and accept a viable Palestinian State in which Palestinians can determine their own future on their own land and live in dignity and security. They, too, will have to make hard compromises.

Ultimately, both sides will have to address the very, very difficult permanent status issues. The future of Jerusalem is a challenge which the two parties can only resolve together through negotiations, taking into account the religious and political concerns that both will bring to the table. Any solution will also have to protect the religious interests of Jews, Christians and Muslims the world over.

On Palestinian refugees, the two parties must strive for a just solution that is both fair and realistic. Again, if there is to be a lasting peace, both sides will have to embrace negotiations on these and the other tough issues before them. The goal can be nothing less than an end to their conflict and a resolution of outstanding claims.

As we have for half a century, the United States is ready to play an active leadership role in helping the parties along the road to a more hopeful future. Toward that end, President Bush and I have asked Assistant Secretary of State for Near Eastern Affairs Bill Burns to return to the region later this week for consultations.

I am also pleased to announce this morning that Retired Marine Corps General Anthony Zinni has agreed to serve as a senior advisor to me, with the immediate mission of helping the parties achieve a durable cease-fire and to move along the lines of the Tenet security work plan and the Mitchell Committee Report. Tony Zinni is a good friend of mine. He is a distinguished soldier, a Marine, with a long experience in the Middle East, particularly on security issues. He will be an invaluable addition to our team.

I heard from Prime Minister Sharon this morning that Israel is forming a senior-level committee to work with the Palestinians on the negotiation and implementation of a cease-fire and what follows from that. I also understand that Chairman Arafat remains ready to do likewise and to engage on these issues through a similar senior-level committee.

I have asked General Zinni to go to the region and remain in the region to work with these two committees and to lend our strongest efforts to the establishment of a cease-fire. Get that cease-fire in place, and other things can start to happen. Without that cease-fire, we are still trapped in the quicksand of hatred. I expect these new committees, with General Zinni's participation, to begin working in the very, very near future.

To help this process, the United States remains ready to contribute actively to a third party monitoring and verification mechanism acceptable to both parties. With a successful cease-fire, and as we move forward on the Mitchell Report and Tenet work plan, we will work urgently with our international partners on an economic reconstruction effort to help rebuild the Palestinian economy. (Applause.)

We cannot hope to turn the current situation around by acting alone, nor should we want to. As in Madrid, so too does our current quest for a better future for Israelis and Palestinians depend on the support of our friends. We look forward to continuing to work closely with Egypt and Jordan, with the European Union, the United Nations Secretary General, with Russia and our many other partners in this effort. They have been so helpful; they all stand behind the Mitchell Committee Report.

My friends, the stakes in our effort are enormous. It would be a tragedy to divert the energies and talents of another generation of young people from peace and prosperity to war and survival. It would be a tragedy to sacrifice so many more potential presidents and prime ministers and peacemakers and poets to this cruel conflict. It is time -- no, it is past time -- to end this terrible toll on the future. It is time -- past time -- to bring the violence to an end and to seek a better day. (Applause.)

Today is the 24th anniversary of Egyptian President Anwar Sadat's historic visit of peace and reconciliation to Jerusalem. As we work to make our vision a reality, we should recall the vision and courage of President Sadat, and of the region's other great peacemakers: Israel Prime Minister Yitzhak Rabin, and Jordan's King Hussein. They are no longer with us, but their legacy lives on and inspires us.

President Bush and I are determined to pursue this quest, and with the peoples of the Middle East, to make the vision of the region at peace a reality. History, fate and success have combined to compel American leadership in the Middle East and around the globe. We welcome the challenge. We welcome the opportunity to use our power and influence to make the world a better place for all of God's children.

Thank you very much.  (Applause.)