In salvos of intransigent oratory, Israel and its Arab neighbors said today that they all hoped to end the bloodshed in their region, but disagreed about almost everything else -- who was at fault, what to do about it, even where further peace talks should be held.
On a day when the Palestinians at last found their place at a major Middle East peace conference, the Arabs demanded that Israel stop creating settlements in occupied territories and give up territory it had taken from Arabs in 1967. The Israelis in turn demanded that the Arabs recognize Israel's right to exist.
Each accused the other of deception, brutality, treachery and aggression, exactly as they have done for most of the 43 years that they have been at each other's throats. Both Sides Listen
But for the first time, representatives of much of the Arab world listened across the same table to an Israeli leader denouncing them, remaining in their chairs throughout, and the Israeli leader, Prime Minister Yitzhak Shamir, listened to their replies. He stayed put even though the Palestinian delegates identified themselves in so many words with the Palestine Liberation Organization, something the Israelis had said could prompt them to walk out.
In one especially heated passage, Farouk al-Sharaa, the Syrian Foreign Minister, accused Mr. Shamir of "faking facts and history." [ Excerpts from speeches, pages A10 and A11. ]
In reply, at a later news conference, Benjamin Netanyahu, an Israeli Deputy Foreign Minister, accused the Arabs of complicity with Hitler, Himmler, Ribbentrop and Eichmann in planning the Holocaust, and said Syria had spoken in terms of "vituperation, slander and condescension." Less Rigidity Expected
"These are just their opening statements, maximalist bargaining positions," a senior American official said. "A lot of it is for television and the political audiences back home. People will start to soften their ideological rigidity once face-to-face negotiations get under way."
But other top-level Americans who have worked for months to bring Israel, Syria, Lebanon, Jordan and the Palestinians together in Madrid expressed disappointment at what one called the "truculent tone" of today's speeches. None could point to any overt sign that the participants were ready to yield ground in the private, direct talks scheduled to start Sunday.
Indeed, it was unclear when, where and even whether those talks would begin. The Israelis and the Arabs remained deadlocked tonight, despite mediation efforts by Secretary of State James A. Baker 3d, over Mr. Shamir's demand that they be held in the Middle East, with a first round in Israel. The Arabs insisted that the plan had always been to negotiate in Madrid and argued that they would be recognizing Israel, in effect, by going there.
There was even some doubt expressed that the single organizational session that everyone had agreed to for Sunday at the Royal Palace in Madrid would go forward as planned.
The Palestinians said explicitly for the first time that they would accept limited self-rule in the occupied West Bank and the Gaza Strip as an interim stop on the way to statehood. In accepting the terms of invitation to the conference, they had implictly said the same thing, but some saw an incremental step forward.
Israel accepts the idea of limited autonomy, which it had agreed to in the 1978 Camp David agreement with Egypt and the United States, but rejects the idea of Palestinian sovereignty. Nonetheless, there has been very tentative talk among the Palestinian delegates and others here in the last 48 hours of some form of eventual confederation, possibly economic, possibly economic and political, involving Jordan, Israel and some sort of Palestinian entity. Jordan Faults Radicals
There was also a small conciliatory note from Jordan. Its delegate urged both sides to work for "the dawn of a new era" and pointedly called on Arab radicals to shed their rigid ideologies.
So the initial two days of the conference here, the first of which was dominated by speeches by Presidents Bush and Mikhail S. Gorbachev, have developed into a microcosm of the Middle East, marked by hopeful words from the great powers, hateful words from the countries of the region and fragile theorizing about what might be. So far, Madrid has been spared the physical violence that has long disfigured the eastern end of the Mediterranean.
