He also spoke darkly of the prospect of another war in this region where long-range missiles and chemical weapons have proliferated.
The next war, Shultz said, "will be unlike any conflict we have seen before, involving more casualties and proving harder to contain."
King Hussein, in talks Saturday with Shultz in Amman, insisted on an Israeli commitment to withdraw as a precondition for accepting the U.S. proposal for peace talks. Shultz said he had emphasized to Shamir "the need for King Hussein's side to feel there is something to negotiate about."
Jordan controlled the West Bank from 1948 until 1967.
The Shultz peace proposal calls for an international peace conference in which the United States, the Soviet Union, China, Britain and France, as the five permanent members of the U.N. Security Council, would serve as hosts.
The negotiations would be aimed at self-rule for 1.5 million Palestinian Arabs in the West Bank and Gaza, but not a separate state. In a second stage, Israel and the Arabs would try to find an overall settlement to their conflict.