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UNCLAS TEL AVIV 001644 
 
SIPDIS 
 
STATE FOR NEA, NEA/IPA, NEA/PPD 
 
WHITE HOUSE FOR PRESS OFFICE, SIT ROOM 
NSC FOR NEA STAFF 
 
SECDEF WASHDC FOR USDP/ASD-PA/ASD-ISA 
HQ USAF FOR XOXX 
DA WASHDC FOR SASA 
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CDR USCENTCOM MACDILL AFB FL FOR POLAD/USIA ADVISOR 
COMSOCEUR VAIHINGEN GE FOR PAO/POLAD 
COMSIXTHFLT FOR 019 
 
JERUSALEM ALSO ICD 
LONDON ALSO FOR HKANONA AND POL 
PARIS ALSO FOR POL 
ROME FOR MFO 
 
SIPDIS 
E.O. 12958: N/A 
TAGS: OPRC KMDR IS
 
SUBJECT: ISRAEL MEDIA REACTION 
 
 
-------------------------------- 
SUBJECTS COVERED IN THIS REPORT: 
-------------------------------- 
 
¶1.  Mideast 
 
¶2.  G-8 Summit, June 6-8 
 
------------------------- 
Key stories in the media: 
------------------------- 
 
All media led with the possibility that a military confrontation 
with Syria might break out this summer.  The media reported that 
this morning the security cabinet will hold a discussion on the 
Syrian and Lebanese borders and the likelihood of war in the north. 
Ha'aretz reported that the majority view in IDF Intelligence holds 
that Syrian President Bashar Assad is well placed to carry out a 
surprise attack on the Golan Heights, but that he is unlikely to 
initiate a war.  The Jerusalem Post reported that Defense Minister 
Amir Peretz expressed a similar view on Tuesday.  Israel Radio 
quoted a senior GOI source as saying that Israel is conveying 
messages to Syria through various avenues that Israel is not 
interested in war.  The source was quoted as saying that Syria is 
speeding up its arming.  Both Yediot and Maariv bannered ongoing 
comments by PM Ehud Olmert that idle talk and bragging by senior 
Israeli military commanders that Israel would win in a confrontation 
with Syria must stop.  Israel Radio said that a senior Israeli 
military source concurred with Olmert. 
 
This morning Israel Radio quoted a senior aide of PA Chairman 
[President] Mahmoud Abbas as saying that a scheduled meeting on 
Thursday between PM Olmert and Abbas has been postponed because the 
sides have not smoothed out a number of issues.  All media had 
reported that Olmert would meet with Abbas in PA territory on 
Thursday -- apparently in Jericho.  Yediot noted that this would be 
the first time since the signing of the Oslo Agreement that an 
Israeli prime minister meets with a PA chairman in a Palestinian 
city.  Yediot reported that Israel will offer the Palestinians a 
thaw in fund freezing and the lifting of roadblocks, but that it 
will decline a cease-fire with Hamas.  Maariv reported that Olmert 
is expected to give up his demand that Abbas act to obtain the 
release of abducted IDF Cpl. Gilad Shalit.  The Jerusalem Post 
quoted Abbas as saying on Tuesday that he is working to achieve a 
truce between the Palestinians and Israel.  Maariv reported that on 
Tuesday Egyptian President Hosni Mubarak called Olmert to discuss 
all current diplomatic issues. 
 
The Jerusalem Post reported that a high-level Israeli delegation 
will meet with officials in Washington this week and demand that 
restrictions be placed on the proposed US sale of state-of-the-art 
weaponry to Saudi Arabia.  The talks are expected to center on the 
US decision to sell Joint Direct Attack Munition satellite-guided 
"smart bombs" to Saudi Arabia.  The sale has caused consternation in 
Jerusalem over concerns that  it could tip the balance of power in 
the region.  The newspaper reported that, if the sale does go 
through, Israel has expressed interest in acquiring the F-22 stealth 
bomber -- a plane that can avoid radar detection and is the world's 
most advanced fighter jet -- to maintain its qualitative edge. 
Israel is to be represented at the talks by Defense Ministry 
Diplomatic-Military Bureau head Amos Gilad and IDF Planning 
Directorate head Maj. Gen. Ido Nehushtan.  The US team is to be 
headed by Beth McCormick, the Acting Deputy Under Secretary of 
Defense for Technology Security Policy and National Disclosure 
Policy, and the Director of the Defense Department's Defense 
Technology Security Administration. 
 
Ha'aretz reported that on Tuesday the Association for Civil Rights 
in Israel sent a letter to Justice Minister Daniel Friedmann to 
protest the "dangerous and unprecedented step" of revising a Basic 
Law in a bid to circumvent a High Court of Justice decision.  The 
court overturned the Intifada Law, which exempts the state from 
compensating Palestinians for damage caused in the course of 
non-combat activities in the territories.  Friedmann wants to 
reinstate it. 
 
Ha'aretz reported that on Tuesday the Knesset's House Committee 
decided to establish a special committee to discuss a bill that 
would require a national referendum to be held before any withdrawal 
from areas under Israeli sovereignty, even in the absence of a Basic 
Law to determine the referendum procedures.  Ha'aretz commented that 
the initiative, sponsored by former coalition whip MK Avigdor 
Yitzhaki (Kadima), is significant in the context of the public 
debate over whether to enter into peace negotiations with Syria, 
which wants Israel to withdraw from the Golan Heights. 
 
Ha'aretz reported that Israel is considering demanding that UN 
(UNIFIL) forces be stationed north of the Litani River in Lebanon. 
 
Ha'aretz reported that Foreign Ministry Director General Aharon 
Abramovitch secretly visited Morocco recently, meeting with the 
country's Foreign Minister to discuss the Arab peace initiative. 
During Abramovitch's flash visit of just a few hours, he also met 
with other senior ministry officials.  Abramowitz told his hosts 
that while Israel agreed to certain clauses, it has reservations on 
other aspects of the plan, such as the clause pertaining to the 
refugee problem.  In addition to the peace initiative, Abramovitch 
discussed the situation in the PA.  Abramovitch also requested that 
his Moroccan colleagues consider reopening their liaison office to 
Israel, which was closed in 2000 after the second Intifada broke 
out.  Ha'aretz noted that, despite this, Morocco has maintained 
low-level diplomatic relations with Israel throughout the period. 
 
Ha'aretz quoted senior Israeli defense officials as saying on 
Tuesday that the evacuation of settlers from a Palestinian home in 
Hebron will be deferred for a long time, if it takes place at all. 
The media reported that, on the same day, a gathering of about 200 
Peace Now demonstrators took place in the city to mark the 40th 
anniversary of the outbreak of the Six-Day War.  The Jerusalem Post 
reported a joint demonstration of Israelis and Palestinians took 
place at the Anata refugee camp north of Jerusalem to use the 40th 
anniversary of the Six-Day War to host a binational peace event. 
 
This morning IDF Radio reported that the Amana settlement movement 
is constructing about 100 new housing units in the West Bank, most 
of which have already been sold.  These units were already approved 
by the GOI several years ago, but the decision was never 
implemented.  IDF Radio quoted political sources as saying that the 
construction of the units contradicts promises made by officials in 
Jerusalem to officials in Washington to stop construction in the 
area. 
 
Ha'aretz and Israel Radio reported that on Tuesday the Knesset's 
Finance Committee approved a 2.4 million shekel (around USD 590,000) 
allocation for protecting medical institutions in communities near 
the Gaza Strip, including Ashkelon's Barzilai Hospital. 
 
The Jerusalem Post quoted senior employees of the Israeli 
Consulate-General in New York as saying in a letter sent this week 
that new budget cuts at the Consulate-General will critically reduce 
the office's "hasbara" (advocacy) efforts. 
 
Last night Israel TV disclosed an alleged bribery affair surrounding 
the Labor Party primaries in the Galilee city of Safed and involving 
Defense Minister and Labor Party Chairman Amir Peretz.  Peretz 
denied the report. 
 
Ha'aretz quoted the United Arab List (Ra'am-Ta'al) party as saying 
 
on Tuesday that it will support the candidate for Israel's 
presidency who agrees to release Israeli Arab security prisoners. 
 
Leading media quoted Mahmoud Abbas as sayng on Tuesday that 
Palestinians are on the verge of civil war and that the in-fighting 
is worse than Israeli military rule. 
 
All media quoted President Bush as saying in Prague on Tuesday that 
he would explain to his Russian counterpart, Vladimir Putin, that 
there is no reason for Russia to be afraid of the stationing of a US 
anti-missile base in the Czech Republic and Poland. 
 
The Jerusalem Post reported that Lehman Brothers has rated Israel as 
having the lowest vulnerability of risk of a financial threat among 
emerging market economies.  The newspaper reported that the global 
investment bank, headquartered in New York City, cautioned that 
political and monetary risks were on the rise.  The Jerusalem Post 
reported that this week Steve Forbes, businessman and Chief Editor 
of Forbes Magazine, raised high hopes for the growth potential of 
the Israeli economy if liberalization reforms are continued and 
taxes lowered.  Forbes was speaking at a conference in Tel Aviv 
celebrating the third anniversary of the Forbes Israel Hebrew 
Magazine.  On Tuesday Steve Forbes received an honorary degree from 
Haifa University. 
 
The Jerusalem Post cited an announcement made on Tuesday by Elbit 
Systems Ltd., an Israeli maker of military products, that it won an 
order of about USD 18.5 million from the US Marine Corps for 
handheld military computers 
 
In The Jerusalem Post, Yehuda Avner, who was on the staff of five 
Israeli prime ministers, described the start of the US-Israeli 
alliance at the time of the Six-Day War. 
 
Yediot cited concerns in Israel that basil grown in Israel, exported 
to Britain, and disseminated from there to other European countries 
was deliberately tainted with the salmonella bacteria.  The 
herb-contamination affair was reported by all media on Tuesday. 
 
The Jerusalem Post reported that the Israel Broadcasting Authority's 
Management Committee will vote next Monday on a cost-cutting 
emergency plan that would close most Israel TV and Israel Radio 
programs, including the IBA News in English and the English radio 
news. 
 
-------- 
Mideast: 
-------- 
 
Summary: 
-------- 
 
Diplomatic correspondent Ben Caspit wrote on page one of the 
popular, pluralist Maariv: "Both the Syrian President and the 
Israeli Prime Minister have been playing a dangerous game with one 
another in the past few months." 
 
Prof. Uzi Arad, the Director of the Institute for Policy and 
Strategy at the Interdisciplinary Center, who was a senior advisor 
to former prime minister Binyamin Netanyahu, wrote in the 
mass-circulation, pluralist Yediot Aharonot: "Not only is a full 
Israeli withdrawal from the Golan Heights not in Israel's best 
interests, but on this matter Israel is also supported by a 
long-standing American commitment, which has been reaffirmed by 
Bush." 
 
Military correspondent Amos Harel wrote on page one of the 
independent, left-leaning Ha'aretz: "Ties between [Syria and Iran] 
have been strengthened, and Israeli intelligence sources describe 
this as a strategic alliance." 
 
The nationalist, Orthodox Makor Rishon-Hatzofe editorialized: "The 
Israeli player is required to give up real assets, while the Arab 
player is required to give words." 
 
Defense and foreign affairs columnist Amir Oren wrote in Ha'aretz: 
"The pot boiling under the [Egyptian] regime is threatening -- if it 
boils over -- to throw the lid off, and with it, also the peace with 
Israel." 
 
Block Quotes: 
------------- 
 
¶I.  "Dangerous Game" 
 
Diplomatic correspondent Ben Caspit wrote on page one of the 
popular, pluralist Maariv (6/6): "Both the Syrian President and the 
Israeli Prime Minister have been playing a dangerous game with one 
another in the past few months.... The reinforcement of the 
Damascus-Tehran axis is the greatest cause for concern in the 
security establishment and political echelon in Israel.... 
Therefore, any American or international escalation vis-`-vis Tehran 
could cause a second front to be opened against us.  It will start 
with rockets by Hizbullah and continue with war against Syria, in 
parallel.  All this is converging, so it is said, towards the coming 
summer.... It is necessary to cool things off, to moderate.  We have 
to calm matters and be silent for a while.  The Syrians are 
threatening?  Let them threaten.  There is need for composure.  They 
have already received, say Olmert's aides, a great many messages 
that Israel is not interested in war with them.  They have been 
receiving such messages almost every week.  But the panic is also 
unnecessary.   Olmert is conducting indirect, distant, covert talks 
with the Syrians.... The Americans are in the picture, and a Syrian 
figure there is also playing a role in this game: Syrian Ambassador 
in Washington Imad Mustafa, one of the people closest to Syrian 
President Bashar Assad, is also involved.  Sources close to Olmert 
deny involvement or direct talks with Mustafa, but sources related 
to the talks believe that the man, who is an enthusiastic supporter 
of negotiations with Israel, is in the picture and updating the 
President in Damascus.... The Americans have not yet formulated a 
final opinion on the Israeli-Syrian channel.  Their efforts to 
revive President Bush's vision and create an achievement on the 
Palestinian front before the term ends is in contravention of an 
Israeli-Syrian effort.  The question is whether Olmert will come to 
Washington after having made up his mind and knowing what he wants, 
or whether he will let the president decide for him." 
 
II.  "Neither Under Fear Nor Under Fire" 
 
Prof. Uzi Arad, the Director of the Institute for Policy and 
Strategy at the Interdisciplinary Center, who was a senior advisor 
to former prime minister Binyamin Netanyahu, wrote in the 
mass-circulation, pluralist Yediot Aharonot (6/6): "The Syrian 
option has been in the air since the Second Lebanon War ended.  It 
was recently reported that the Prime Minister is also examining it, 
and it was recently stated in the media that military officials, no 
less, are urging Israel to hold negotiations for fear of a military 
deterioration if this is not done.  If the reports are true, then 
the diplomatic option with Syria is now being considered for poor 
reasons.... A lasting agreement with Syria requires conditions that 
do not currently exist: Firstly, there must be real indications that 
Syrian willingness for negotiations indeed reflects a change in its 
real agenda.  Secondly, in order to make sure that the entire burden 
of negotiating, including the concessions, does not fall on Israel, 
there is a need for partners, mainly the US and Europe.  Thirdly, an 
understanding is needed that previous formulae for an arrangement 
are no longer binding, and that an arrangement requires flexibility 
on Syria's part regarding the outline for a territorial arrangement 
 
on the Golan Heights.  Not only is a full Israeli withdrawal from 
the Golan Heights not in Israel's best interests, but on this matter 
Israel is also supported by a long-standing American commitment, 
which has been reaffirmed by Bush.... Negotiations should not be 
begun under fear or under fire.  This is also the reason that Syria 
must cease its indirect war against Israel by means of Hamas and 
Hizbullah.  International diplomacy is required here, to form a 
coalition that will find the incentives and rewards to bring about 
the necessary strategic turnabout on SyriaQs part, and so that the 
burden of concessions does not fall entirely on Israel.  Therefore, 
the solutions that can lead to future effective negotiations with 
Syria are regional and international." 
 
III.  "Fear of Escalation Tops IDF's Agenda" 
 
Military correspondent Amos Harel wrote on page one of the 
independent, left-leaning Ha'aretz (6/6): "On Tuesday Israel 
contributed to the growing tension with Syria through a series of 
statements by senior members of the defense establishment..... 
Senior IDF officers told Ha'aretz on Tuesday that the threat of an 
escalation with Syria is at the top of the Chief of Staff's 
agenda.... However, the officers noted, there is no definitive 
intelligence backing this.  'There are two possible scenarios,' 
explained one officer.  'One is that the chief of staff is trying to 
expedite preparation of the forces just in case.  The other is that 
he has received troubling intelligence that has not been released to 
the rest of the senior officers.'  Israel's concerns stem from 
several developments that have taken place in the Syrian army since 
the Second Lebanon War.  Syria is in the midst of an effort to 
strengthen its forces, at all levels, through multibillion-dollar 
arms procurements, mostly funded by Iran.  Ties between the two 
countries have been strengthened, and Israeli intelligence sources 
describe this as a strategic alliance.  Senior officials from 
Damascus and Tehran have held frequent meetings lately." 
 
IV.  "Playing With Fire" 
 
The nationalist, Orthodox Makor Rishon-Hatzofe editorialized (6/6): 
"The Prime Minister's associates say that he is vacillating between 
the Syrian and the Palestinian tracks.  He will soon decide which 
course to take.... The Prime Minister knows that both tracks lead to 
stalemate.  A Hamas government is ruling in the Palestinian 
Authority.  Olmert himself has sworn not to have any contacts with 
it -- and rightly so.... As regards the Syrian track, Bashar Assad, 
like Olmert, is interested in talks but not in results.... But this 
game is not symmetrical.  The Israeli player is required to give up 
real assets, while the Arab player is required to give words.... 
Above all, this is not a game.  The volley of Qassam rockets that 
poured on Sderot over the past month was only a reminder of the fact 
that Israel has paid an awful price for the spin culture.  One 
should say 'Enough!' to those who play with Israel's fate." 
 
¶V.  "When the Lid Is Afraid of the Pot" 
 
Defense and foreign affairs columnist Amir Oren wrote in Ha'aretz 
(6/6): "The view that Egypt is a moderate, peace-seeking country is 
an optical illusion. Cairo, which purchased its ticket to Washington 
through Jerusalem, is once again not thrilled to be part of the camp 
affiliated with the Americans.  The Egyptian people, who are not 
eager to get involved directly in a war, are instead encouraging war 
from the sidelines.... Opinion polls show that Egypt -- the largest 
Arab state, with the most advanced and powerful military -- is also 
the most hostile to Israel, the United States and the West.  This is 
not a matter of hairsplitting interpretation or passing trends: The 
data are unequivocal, and as frightening as a storm of religious 
fanaticism and prejudice.... The pot boiling under the regime is 
threatening -- if it boils over -- to throw the lid off, and with 
it, also the peace with Israel.  The resulting security tensions 
will not immediately escalate or lead to a new war, a sixth war, 
between the two countries.  But there will be no deeper, broader 
peace than the one that currently reigns on our southwestern 
border." 
 
------------------------- 
¶2.  G-8 Summit, June 6-8: 
------------------------- 
 
Summary: 
-------- 
 
Correspondent Lior Kodner wrote from Hamburg in the independent, 
left-leaning Ha'aretz: "The impression that one gets at the start of 
the [G-8 Summit is that of a free-for-all." 
 
Block Quotes: 
------------- 
 
"Everybody Against Everybody" 
 
Correspondent Lior Kodner wrote from Hamburg in the independent, 
left-leaning Ha'aretz (6/6): "The impression that one gets at the 
start of the [G-8 Summit is that of a free-for-all.... If it had 
appeared, following the September 11 attacks in the United States, 
that the international community was adopting the slogan 'One for 
all, all for one,' the current motto is 'Everyone against everyone.' 
 It is fortunate that the Middle East, at least, is not presently 
the focus of the agenda.." 
 
CRETZ