Setup SQUID to forward proxy information

[bitwise]

Can you setup SQUID on a linux box that is your router and just redirect all web request from clients to squid like this:

$IPTABLES -t nat -A PREROUTING -i $INTERNAL -p tcp --dport 80 -j REDIRECT --to-port 3128

And then can you have squid just request information from another proxy?

I know little about squid. I tried adding a line

cache_peer <external_proxy_ip> parent <external_proxy_port> 0

This doesn't seem to work though. Anyone know howto setup squid to do this...basically just forward web request to the real proxy server?

Thanks,
-bitwise