The panel, compromising senior national security officials, will report to Clinton and Barak every four months as apart of a "new partnership" between the United States and Israel, Clinton and Barak said in a joint statement.
"We should have no illusion; the way ahead will be difficult," Mr. Clinton said at a White House news conference with Barak after four days of talks.
Barak stressed the Middle East was a dangerous part of the world and Israeli prime ministers do not have a second opportunity to keep the country secure if they make a mistake. "We do not intend to drag our feet for another three years."
Signaling that a peace breakthrough may indeed be in store, a Mideast official said Monday that Syrian Vice President Abdel-Halim Khaddam ordered Damascus-based guerrilla groups to drop their arms and halt their fight against Israel. The order was also reportedly targed at Hezbollah, which leads a costly guerrilla war aimed at ousting Israeli troops and their proxy militia from Lebanon.
Announcing the first Israeli astronaut would enter space on a NASA flight in 2000, Mr. Clinton called it "taking our partnership to new heights - literally."
Earlier on Monday, Barak told Treasury Secretary Lawrence Summers that despite a slowdown in the Israeli economy, Israel intends to phase out over 10 years U.S. economic assistance, now totalling $930 million a year. Israel receives $1.9 billion in military aid annually, and Barak told Summers this might have to be boosted.
Barak's first visit to Washington also produced an agreement for Israel to purchase 50 F-16 jet fighter planes from Lockheed-Martin in installments.
The first step after Barak's visit is a trip to the region next month by Secretary of State Madeleine Albright; she could follow this up with other missions to promote peacemaking on all fronts.
Asked about negotiations on final status talks, covering the tough questions of the future of Jerusalem, refugees, settlements and Palestinian statehood, Mr. Clinton said the United States has no business setting timetables. But he made clear he would like a resolution in the Middle East his departure from office in January 2001.
"We will leave no stone unturned in our effort to reinvigorate the process,'' Barak said. Before his visit, Barak made the rounds of Arab nations, meeting with Palestinian leader Yasser Arafat and the leaders of Egypt and Jordan.
Mr. Clinton was asked whether the peace process is hindered by his wife campaigning for New York's Senate seat and her statements supporting Palestinian statehood and Jerusalem as the undivided capital of Israel. Such positions are contrary to the U.S. policy of neutrality on these final statuissues.
The president distinguished between his wife and ``those of us in position of official responsibility.''
Commenting on what has been a sticky issue, the prime minister said he would still like convicted spy Jonathan Pollard to be released from a U.S. prison but added that ``any public discussion of this issue doesn't push forward the purpose of having him released.''
Barak pledged during his visit to implement a stalled agreement Clinton helped mediate in October that calls for Israel to relinquish 13.1 percent of the West Bank in exchange for tougher anti-terrorism measures by the Palestinian Authority.
b>``I will not shy away from difficult choices, Barak pledged. But I have a responsibility to all the people of Israel to minimize the risk and dangers" to their security.
Talks with Syria and Lebanon have been in a deep freeze for three years, but Barak and President Hafez Assad of Syria both have said they were interested in resumption.
Assad, however, wants to begin where the negotiations left off with an Israeli offer to give up all of the Golan Heights. Barak desires a ``fresh start'' in the discussions.