HISTORIANS will look back at this weekend's cease-fire agreement in Lebanon as a pivotal moment in the war on terror. It is pivotal in the same sense that the Munich agreement between Adolf Hitler and Neville Chamberlain was pivotal in an earlier battle against the enemies of freedom. The accord in October 1938 revealed to the world that the solidarity of the Western allies was a sham, and that the balance of power had shifted to the fascist dictators.

Resolution 1701 shows that, for the time being at least, the balance has likewise shifted to the terrorists and their state sponsors. Like Munich, it marks the triumph of the principle of putting off until tomorrow what needs to be done today. Like Munich, it will mean no peace in our time, but a bigger war in our future.

In that sense, the cease-fire may be even more momentous than Munich, and a greater blunder. In 1938 Chamberlain and other appeasers had the excuse that they were trying to prevent an armed conflict no one wanted. Today, of course, that conflict is already here. Historians will conclude that by supporting U.N. Resolution 1701 and getting Israel to agree, the Bush administration has in effect declared that its global war on terror is over. We have reverted to the pre-9/11 box of tools, if not necessarily the pre-9/11 mindset. From now on, the worst Iran, Syria, and North Korea will have to worry about are serial resolutions in the United Nations. Terrorists will be busy dodging Justice Department subpoenas, not Tomahawk missiles.

Our enemies know better. They know the war is only entering a new stage, and they know who the winners and losers were last weekend.

The clear losers were the United States and Israel. Israel has sacrificed lives and treasure, and had its honor dragged through the mud of international opinion, for no purpose. America squandered its political capital at the start of the crisis by getting moderate Arab regimes to condemn Hezbollah instead of Israel. They did so because they thought Hezbollah was about to be annihilated. However, they soon realized their mistake. They now know Tehran and Damascus will set the agenda in the Middle East, not Washington. The Arab League's support for this U.N.-brokered deal is just one more measure of our strategic failure.

The other loser is Lebanon. The price of peace in 1938 was de jure dismemberment of Czechoslovakia, as Germany annexed the Sudetenland. The price of Resolution 1701 is de facto dismemberment of Lebanon. A large, well-armed terrorist army acting at the behest of a foreign power now controls the southern half of Lebanon, and pulls the strings in the other half. The facade of Lebanese self-government has been preserved. As a territorial state, it may even last longer than Czechoslovakia did (Hitler gave the Czechs five months before he annexed the rest of their country).

But other states in the region will have learned their lesson. Faced by an internal terrorist organization, especially one with links with Tehran, they will have to make accommodations. No white knight in the guise of U.S. Marines will ride to their rescue; no Israeli tanks and F-16s will do their dirty work for them. Appeasement will be the order of the day.

That includes Iraq. The disarming of Sunni and Shia militias, the necessary first step to ending sectarian violence there, will be postponed - perhaps for good. On the contrary, this crisis has taught Iraq's Shia minority that extremism pays, particularly the Iranian kind.

For everyone in the Middle East knows Iran is the clear winner. Only the diplomats and politicians, including the Bush administration, will pretend otherwise. Iran has emerged as the clear champion of anti-Israeli feeling and radical Islam. The Iranians have their useful puppet in Syria; they have their proxy armies in place with Hezbollah and Hamas. They have been able to install missiles, even Revolutionary Guards, in Lebanon with impunity. Sunni regimes in the region will move to strike their own deals with Iran, just as Eastern European states did with Germany after Czechoslovakia. That includes Iraq; the lesson will not be lost on Russia and China, either. And all the while, the Iranians proceed with their nuclear plans - with the same impunity.

Finally, the other winners are the conventional diplomats at the State Department, especially Undersecretary of State for Political Affairs Nicholas Burns. In a narrow professional sense, appeasement is their business. They never saw the point to a "war on terror" they are delighted to take back the initiative from the hawks at the Pentagon and the White House.

The war in Iraq has clearly sapped the moral strength of the Bush administration. The men of Munich acquiesced to Hitler because another world war like the first seemed unthinkable. The Bush administration clearly feels it cannot face another major confrontation even with a second-rate power like Iran. Yet by calling off the war on terror, it has only postponed that conflict.

"We have passed an awful milestone in our history," Winston Churchill said after the Munich agreement was signed. "Do not suppose this is the end ... This is only the first sip, the first foretaste, of a bitter cup that will be proffered to us year by year." Despite the failure of appeasement, Churchill still believed the Western democracies would make the "supreme recovery" and take up the banner for freedom again. The United States and the forces of democracy will recover from this debacle - even with a Democratic Congress in 2006 and a Democratic president in 2008. The reason will not be because Bush's opponents have a better strategy, or a clearer vision, or even a Winston Churchill waiting in the wings. It will be because our enemies will give us no choice.

Less than a year after Munich, Nazi panzers rolled into Poland. Instead of fighting a short, limited war over Czechoslovakia, the Western democracies ended up fighting a world war, the most destructive in history. The war with the mullahs of Iran is coming. It is only a question of whether it will be at a time or on a ground of our choosing, or theirs - and whether it is fought within the shadow of a mushroom cloud.

Arthur Herman is a historian. He is the author most recently of "To Rule The Waves: How the British Navy Shaped the Modern World." He is completing a book on Churchill and Gandhi.

This appeared August 16, 2006 in the New York Post.

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