This record is a partial extract of the original cable. The full text of the original cable is not available.

C O N F I D E N T I A L SECTION 01 OF 02 TEL AVIV 001065 
 
SIPDIS 
 
E.O. 12958: DECL: 03/15/2016 
TAGS: PREL PGOV KWBG KPAL IS SETTLEMENTS ISRAELI PALESTINIAN AFFAIRS
SUBJECT: SETTLEMENTS AND BARRIER: OLMERT CHANGES GEARS; 
CLAIMS U.S. SUPPORT 
 
REF: TEL AVIV 0940 
 
Classified By: Ambassador Richard H. Jones; Reasons 1.4 (B) and (D). 
 
¶1. (C) Summary: A/PM Ehud Olmert has recently made a number 
of public statements on the separation barrier, annexation of 
settlements, and finalizing Israeli borders that appear to be 
at odds with his oft-stated commitment to the Roadmap and 
previous agreements with the USG concerning settlements.  In 
response to campaign pressure from the Israeli right, Olmert 
has increasingly elaborated upon plans to hold an internal 
Israeli dialogue on the separation barrier, complete the 
barrier, make that line Israeli's de facto border, annex 
major settlement blocs (including Maale Adumim, Ariel, Gush 
Etzion, and the "Jerusalem envelope"), proceed with 
construction in E-1, retain Israel's "security border" along 
the Jordan Valley, and separate the Israeli and Palestinian 
populations to the maximum extent possible.  He also called 
for settlers to consolidate from isolated locations in the 
West Bank into expanded settlement blocs west of the barrier. 
 Olmert's purported intention to seek international support 
is made problematic by his (and Avi Dichter's) stated 
intention to leave the IDF deployed on the West Bank.  Olmert 
and his staff have told the press that the USG was consulted 
on and supports such plans.  Post recommends that we approach 
A/PM Olmert now, and the new GOI immediately after formation, 
to stress that the USG has not concurred with Olmert's stated 
plans.  End summary. 
 
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Evolution of Olmert's Settlement and Barrier Policies 
--------------------------------------------- -------- 
 
¶2. (C) After assuming the Prime Minister's duties in January, 
Olmert was initially cautious in his remarks on peace process 
issues.  In private meetings with USG officials and visiting 
CoDels, he repeatedly stressed his commitment to the Roadmap 
and pledged to uphold the GOI's commitments to the President 
on the removal of outposts.  He ordered -- and saw through to 
completion -- the removal of settlers from the Hebron market 
and the demolition of nine permanent houses in Amona.  On 
March 7, Olmert told a group of transportation experts that 
"Israel will not invest in construction or infrastructure 
development beyond the Green Line in the coming years," 
although it was clear from context that he meant the area 
east of the barrier. 
 
¶3. (U) Following the combination of the Hamas victory, strong 
criticism from political opponents such as Bibi Netanyahu 
during the ongoing Knesset election campaign, and a gradual 
slide in Kadima's polling numbers, Olmert has changed gears. 
On March 10, he outlined for reporters his plans to separate 
Israeli and Palestinian populations by 2010.  He said that if 
the new Hamas-run PA refuses to accept the international 
community's three conditions "after a reasonable amount of 
time -- and this will not be measured in years," then Israel 
will take further unilateral action.  The steps he mentioned 
track closely with the plan leaked by Kadima candidate and 
former Shin Bet chief Avi Dichter on March 5 (reftel). 
 
¶4. (U) Olmert has also pledged to complete the security fence 
by the end of 2006.  In a press interview, Olmert said the 
separation barrier will be adjusted to a new line, one 
marking what he is specifically terming "permanent borders." 
He said the barrier could potentially be shifted either east 
or west depending on the outcome of an internal Israeli 
dialogue on the subject.  Olmert also called for settlers to 
consolidate from isolated locations in the West Bank into 
expanded settlement blocs west of the barrier.  (Note: The 
barrier, when complete, will likely include several lobes or 
fingers reaching up to 20-plus kilometers into the West 
Bank.)  Although he refused to define the scope of such 
settlement blocs, he mentioned that Israel intends to retain 
Gush Etzion, Maale Adumim, and "the Jerusalem envelope."  He 
later acknowledged that some Arab parts of Jerusalem 
currently within the municipal boundaries, such as the Shufat 
refugee camp, would be excluded.  On March 14, Olmert went a 
step further, offering settlers a dialogue and telling them, 
"I want to be clear on this, the Ariel bloc will be an 
inseparable part of the State of Israel under any situation." 
 He has also mentioned that the IDF will remain deployed on 
the West Bank and the GOI will maintain what he calls its 
"security border" along the Jordan Valley. 
 
¶5. (C) Following the interviews, unnamed GOI officials told 
the press that the GOI had discussed Olmert's plans with the 
USG, which, they claimed, did not object.  When asked by 
reporters whether he intends to build in the E-1 area despite 
U.S. objections, Olmert replied on March 10: "of course. 
After all, it is unthinkable that we will talk about Maale 
Adumim as part of the State of Israel and leave it like an 
island or an isolated enclave ... This is clear to both the 
Palestinians and to the Americans."  In a meeting with the 
Ambassador on March 14 (septel), Internal Security Minister 
Gideon Ezra confirmed that Israel has already begun 
construction of the long-delayed police district headquarters 
in E-1.  He baldly claimed that the President's letter of 
April 14 had acknowledged that Maale Adumim and E-1 would 
remain in Israeli hands, adding that the GOI had always 
intended to build in E-1, but had been temporarily prevented 
from doing so by recently concluded court cases.  Ezra denied 
that the move was in any way connected to the ongoing 
election campaign.  The Ambassador reminded him that the 
President's letter specified that adjustments to borders 
should be mutually agreed and noted consistent U.S. 
opposition to a move that would effectively split the West 
Bank in two.  Ezra blithely pointed to GOI plans to use 
tunnels to preserve connectivity. 
 
-------------------- 
Olmert Changes Gears 
-------------------- 
 
¶6. (C) Comment: Olmert's position on settlements and Israel's 
borders has evolved and become more specific due to the press 
of the Knesset election campaign.  There might be some 
pullback after the successful Jericho operation.  However, 
his public pronouncements on annexing settlement blocs and 
setting Israel's borders along the barrier line push the 
envelope of -- and in points clearly exceed -- the U.S. 
position on these issues contained in the President's letter 
of April 14, 2004.  While Sharon followed much the same 
strategy, he rarely revealed his full intentions to the 
public and was also careful not to claim -- as Olmert has 
done -- that the U.S. is reconciled to construction in E-1 
and other unilateral steps in the West Bank.  While post does 
not recommend an official USG response to every campaign 
pronouncement in the ongoing Israeli election debate, we 
recommend that the USG quietly reinforce our views now with 
the GOI and with the next government immediately after 
formation to avoid future misunderstandings.  If we do not 
lay down a marker now, then we can expect public assertions 
to continue.  Even in the press, such assertions might be 
taken as de facto U.S. acquiescence by the GOI and among 
Israelis, making future disagreements harder to resolve. 
 
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