GSTAAD, Switzerland - Keynes once wrote, "In the long run we are all dead." Concentrating on the short-term has long been in vogue in economics and finance. It has even crept into national security planning- nowhere more so these days, it seems, than in Israel.

Israel's focus on the current threat from the Palestinians, and particularly its effort to find some way to end the suicide bombings that have taken the lives of so many civilians, is understandable. But in the not too distant future it could face much greater danger from its other neighbors, particularly Iran.

The Jewish state's response to the Palestinian violence has been surgical-targeting suspected terrorist leaders while avoiding full-may have short-term benefits, but it does not make Israel more secure.

In fact, the greatest danger to the Jewish state is not from the Palestinians-although they now have some 60,000 armed fighters within walking distance of its military garrisons and air bases. It is from the Islamic Republic of Iran.

Scarcely two decades ago, Iran was Israel's closest ally in the Middle East. Persians and Jews have been close for 2,500 years, since Cyrus the Great freed the Jews from captivity and allowed them to return home to rebuild the temple in Jerusalem. Tehran's official support of Israel suddenly changed into rabid anti-Zionist anti-Semitism with the overthrow of the shah by Ayatollah Ruhollah Khomeini and his fellow political mullahs in 1979.

Israel's defense minister, Binyamin Ben-Eliezer, has warned that the Islamic Republic has ballistic missiles that can be armed with chemical or biological warheads, and will have a nuclear bomb in four years. lam told by reliable sources that Iran already has several nuclear devices, secretly purchased from a former Soviet republic.

For the Islamic Republic to contemplate a nuclear attack on Israel, however, it would have to think of itself as a collective suicide bomber. If it is willing to lose Tehran, Qom, Isfahan, Shiraz, its religious sites and its oil fields in order to destroy the Zionist state, the situation is hopeless.

In addition to its land- and air-based nuclear forces, Israel has submarines with cruise missiles capable of launching nuclear weapons from under the water. This sea-based nuclear deterrent is very hard to locate and destroy.

A more realistic danger comes from southern Lebanon. The sector is controlled by Iranian-backed Hezbollah guerillas in possession of thousands of modified Katyusha rockets (supplied by Iran) that can reach Haifa. The first Katyusha fired in anger would undoubtedly trigger an all-out' Israeli response against not only Hezbollah but also Syria, with its 35,000 troops occupying Lebanon, Southern Lebanon could provide the spark that triggers a major regional war.

Israel cannot hope to control these dangers on its own. That means it needs friends. First on this relatively short list is the United States.

President George W. Bush, who appreciates Jerusalem's precarious security situation, seems to be seeking greater flexibility in dealing with Iran. A visitor to that country learns that the vast majority of its people want change. Hojatoleslam Taha Hashemi, an influential cleric close to Ayatollah Sayed Ali Khamenei, the supreme leader, recently said, "If the United States shows its goodwill, there is no natural opposition to these relations." The United States should increase the pace of normalizing relations with Iran.

Germany, a country on good terms with Iran, is Israel's second most important ally, providing critical support in the military, intelligence, political and economic fields. It built and largely subsidized the three highly sophisticated submarines operating in the Mediterranean. Berlin has become Jerusalem's chief advocate in Europe.

Rudolf Dressier, the German ambassador to Israel says: "We feel co-responsible that the existence of Israel be guaranteed, and the political consequence is that, when in doubt, we side with Israel, because that is our unique duty."

Two other countries which have diplomatic relations with Tehran have become increasingly important to the Jewish state-Turkey and India.

In 1996, Israel cemented a military and security alliance with Turkey. Jerusalem and Ankara were drawn together by shared concerns (ballistic missiles, terrorism, Islamic radicalism) and common enemies (Iran, Iraq, Syria). The agreement provides for joint air and naval exercises-a chance for Israel's air force to train over the vast Anatolian plateau, which allows better surveillance of Iran's nuclear and missile installations.

Israel and India are rapidly developing a close working relationship, particularly in the military and strategic area. India, concerned about the rise of Islamic radicalism in Pakistan, has turned to Israel for support. America's Jewish community lobbied to block certain U.S. military sales to Pakistan, and Israeli counterterrorism experts are reportedly helping to train their Indian counterparts.

And then there is Russia. Despite its close ties to Iran and Arab countries, Moscow and Jerusalem have much in common. Both are victims of what President Vladimir Putin calls "Islamic tenor." One-sixth of Israel's population consists of Russian-speaking immigrants. And last year bilateral trade between the two countries exceeded $1 billion.

These friends may help keep the Iranian threat to Israel in check. But Israel's handling of the Palestinians makes it harder to retain allies - even the United States - much less forge new or stronger relationships with other nations. Israel needs to find a way to increase its day-to-day security without alienating its supporters.

One idea beginning to get attention is a policy of separation - specifically, an Israeli withdrawal from the West Bank and Gaza and a sealing of the new border. After that Israel should, to the extent possible, work with the new Palestinian government to help it succeed.

Israel must begin to recognize that a free, democratic and prosperous Palestinian state is in its long-term security interest. This might bring an end to the Zionist dream of a Greater Israel, but it would also end the nightmare that Israel lives with at present.

Stanley A. Weiss is founder and chairman of Business Executives for National Security. The views he expresses are his own.