Former Secretary of State Hillary Rodham Clinton said Wednesday she was "personally skeptical" that Iran would agree to a comprehensive deal to remove its nuclear weapon capabilities but said the Obama administration faced a promising opportunity that required it to "give diplomacy space to work."

Clinton told the American Jewish Committee that American negotiators needed to be "tough" and "clear-eyed" as they conduct nuclear talks but said the ongoing talks in Vienna between six world powers and Iran represented an opportunity to reduce Iran's potential nuclear weapons-making ability. The talks are being conducted ahead of a July 20 target date for a deal.

"To get there we will have to be tough, clear-eyed and ready to walk away and increase the pressure if need be. No deal is better than a bad deal," Clinton said, adding that any agreement that endangers U.S. or Israeli national security should be rejected.

Former Secretary of State Hillary Rodham Clinton addresses the American Jewish Committee (AJC) Global Forum closing plenary in Washington, Wednesday, May 14, 2014. (AP Photo/Cliff Owen)

But Clinton called it a "promising development and we need to test it to see what can be achieved. This is a time to give diplomacy space to work. If it does not, there will be opportunities to put in place additional sanctions in the future."

As she considers a potential 2016 presidential campaign, Clinton's speech to the prominent Jewish organization represented one of her most vigorous defenses of her tenure at the State Department and highlighted her work to rein in Iran's nuclear ambitions and promote peace between Israel and the Palestinians.

Clinton is preparing for a high-profile tour next month to promote her upcoming book, "Hard Choices," and expects to help Democrats later this year before mid-term elections. Republicans have questioned Clinton's record as America's top diplomat and have made clear that they intend to try to turn her foreign policy decisions into political liabilities if she runs for president again.

The former first lady did not address speculation about her health that emerged when GOP strategist Karl Rove suggested she may have suffered serious health problems following a fall, a concussion and a blood clot at the end of her tenure in the Obama administration. A few blocks away, former President Bill Clinton vouched for his wife's health, telling an interviewer that "she's in better shape than I am."

Mrs. Clinton presented her time at the State Department as collaboration with President Barack Obama, citing their work to prevent Iran's ability to develop nuclear weapons as an example. She said at the start of the administration, the White House faced the challenge of a rising Iran and allied militants in the Middle East threatening Israel.

"Faced with this inheritance, President Obama and I knew we had a hard choice: keep reading from the same old playbook, politically safe but practically unsustainable; or tear up the old playbook and devise a new strategy." She said the combination of pressure and engagement with Iran forced the country to the negotiating table, where the talks are at a "crucial juncture."

Turning to Israel, Clinton offered a firm defense of Israel but said "hard choices" would be necessary to "achieve a just and lasting peace" between Israel and the Palestinians following the recent failure of the latest round of U.S.-backed Mideast peace talks.

Clinton said there was no "great mystery" about what a final peace agreement might look like between Israel and the Palestinians but "the challenge remains the mobilizing the political will on both sides to make those decisions."

She noted the recent firing of missiles at Israeli troops by militants in the Gaza Strip and warned that the Islamic militant group Hamas must reject violence and accept Israel's right to exist.

"If Hamas refuses to take these basic steps toward peace and legitimacy then they will remain a pariah," she said.

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