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P 141025Z AUG 07
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UNCLAS TEL AVIV 002465 
 
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 
JOINT STAFF WASHDC FOR PA 
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.  Iran 
 
------------------------- 
Key stories in the media: 
------------------------- 
 
Yediot and The Jerusalem Post reported that on Monday in Washington 
Knesset Speaker Dalia Itzik met with Secretary of State Condoleezza 
Rice.  Yediot reported that Itzik thanked the Secretary for her 
efforts to release the abducted IDF soldiers.  Itzik asked Rice to 
continue those efforts.  The Jerusalem Post wrote that the two also 
discussed the US aid package for Israel, the threat of a nuclear 
Iran, and the peace process with the Palestinians. 
 
Leading media quoted Hamas Spokesman Sami Abu Zuhri as saying on 
Monday that Hamas is willing to hold frank talks with the 
international community as suggested by Italian PM Romano Prodi. 
Israel, in turn, expressed concern over Prodi's statements.  Media 
quoted FM Tzipi Livni as saying that dialogue with terrorist 
organizations will "pull the rug out from under the feet of 
moderates" and block any chance of reaching a real agreement with 
the Palestinians.  The head of the Italian government pointed out on 
Sunday that in order to achieve a peaceful solution to the Middle 
East conflict, dialogue with all parties involved was necessary, 
including Hamas and Syria. 
 
Ha'aretz reported that Israeli intelligence may be able to decipher 
Syrian President Bashar Assad's intent towards a possible war.  A 
senior defense source told Ha'aretz on Monday that "as far as we can 
assess, Assad does not really want war with us.  He is concerned 
about a scenario that will drag us and them [Syria] to war, either 
through mutual escalation on the Golan Heights, or through growing 
tensions between the United States and Iran."  The source was 
further quoted as saying: "We do not know what will happen in the 
end, but after the performance of the IDF in the Second Lebanon War, 
we are obligated to prepare in a much better way."  Defense Minister 
Ehud Barak and IDF Chief of Staff Gabi Ashkenazi have discussed the 
issue in a special ministerial committee on the northern front.  PM 
Ehud Olmert has also been kept abreast of developments.  Ha'aretz 
noted that it is presumed Syria will not attack because it is 
contrary to its interests, but that analysts are unable to discount 
the possibility that war will break out, despite both sides' 
reluctance to engage in a conflict, if tension between the two sides 
continues.  Yediot reported that Syrian intelligence chief Assaf 
Shawkat is behind efforts to drag the IDF into a war with Syria. 
 
Leading Israeli electronic media quoted Palestinian sources as 
saying that a Hamas activist was killed and five to seven others 
wounded in an IAF missile attack in Gaza.  Israel Radio later 
reported that four Palestinians were killed in the attack.  The 
radio reported that IDF forces, including tanks and the IAF, are 
operating ion the southern Gaza Strip area of Khan Yunis.  Ha'aretz 
and The Jerusalem Post reported that on Monday IDF sources captured 
four Palestinians who infiltrated Israel from the Gaza Strip, close 
to the Kissufim border crossing.  Leading media quoted the police as 
saying on Monday that Israeli security officials have arrested five 
Arab residents of east Jerusalem in connection with a spring 
shooting attack on security personnel on the outskirts of the city. 
 
Major media reported that in Jerusalem on Monday, in what The 
Jerusalem Post noted could be the "dawn of a new era of cooperation 
between Israelis and Palestinians," officials from both sides held a 
public ceremony to sign what an extension of the mandate for the 
Temporary International Presence in Hebron (TIPH). 
 
Major media quoted visiting Japanese FM Taro Aso as saying on Monday 
during a joint press conference with President Shimon Peres, 
regarding a Japan-sponsored project in the Jordan Valley: "I hope 
steps can be implemented one by one and that the project and that 
the project will bring peace and prosperity to the region.  This is 
a vital issue not just for Israel and the Palestinians, but also for 
Japan.  Peres thanked Aso for Japan's efforts toward peace. 
 
Israel Radio reported that the Israeli defense establishment denied 
reports that Israel has allowed armed Palestinians to operate in the 
West Bank's Israeli-controlled "Area B."   The radio reported that 
the IDF is allowing Palestinian policemen to intervene in neighbor 
disputes in "Area B." 
 
All media reported that on Sunday, in an announcement to the 
Palestinian news agency Maan, an unknown Israeli Arab organization 
calling itself the "Galilee Freedom [or Liberation] Brigades" 
claimed responsibility for the terrorist attack in Jerusalem's Old 
City last Friday -- in retribution for the death of an Arab Israeli 
gunman from the Galilee whom security forces killed three years ago. 
 Ha'aretz quoted knowledgeable sources as sayng that the claim was 
not credible. 
 
The Jerusalem Post reported that the British government has blocked 
almost one third of British military exports to Israel this year, 
citing possible threats to regional stability and fears that the 
equipment might facilitate human rights violations.  According to 
official figures, the value of UK military sales arms to Israel 
declined by one third last year, and has fallen by 75 percent since 
¶2005. 
 
Analyzing Interior Ministry figures for 2006, Ha'aretz found that 
the settler population is growing twice as fast as the rest of the 
country every year, and the ultra-Orthodox community is responsible 
for approximately half this growth.  During the last year, the 
settler population has grown by 5.45 percent, from 260,932 to 
275,156.  Without the ultra-Orthodox community the West Bank 
settlements' growth is 3.7 percent.  The growth rate in the 
ultra-Orthodox Beitar Ilit and Modi'in Ilit is higher than most 
places in Israel. 
 
Yediot reported that on Monday the Winograd Commission hinted that 
it will recommend that action be taken against PM Olmert and senior 
IDF officers over their role in the Second Lebanon War. 
 
All media reported on today's Likud primary, in which the party's 
Chairman Binyamin Netanyahu, far-Right activist Moshe Feiglin, and 
World Likud Chairman Danny Danon are vying for party leadership. 
Ha'aretz said that if Feiglin wins 30 percent of the vote, Likud's 
image would suffer, helping the rival Kadima and Labor parties. 
 
Leading media reported that Suha, the widow of the late PA chairman 
[president] Yasser Arafat, has been stripped of her Tunisian 
citizenship and asked to leave the country along with her 
12-year-old daughter, Zahwa.  Media cited Suha Arafat's relationship 
and possible marriage with Bilhassan Tarabulsi, the brother-in-law 
of Tunisian President Zine el Abidine Ben Ali, as the probable 
reason for the move. 
 
Leading media reported that the Israeli Arab Ka'adan family has 
started building a home in Katzir, a communal settlement in northern 
Israel.  The Ka'adans had tried to set up house there since the 
1990s and won a landmark 2000 High Court ruling in which they gained 
approval. 
 
All media reported that on Monday right-wing Bar-Ilan University 
Professor Hillel Weiss apologized for cursing an IDF officer during 
the eviction of settlers from two properties in Hebron last week, 
but that he later said that his apology had been coerced. 
 
Ha'aretz quoted the GOI's Central Bureau of Statistics as saying 
this week that Israel's trade deficit soared to USD 4.9 billion in 
the first seven months of 2007. 
 
Ha'aretz reported that on Monday Finance Ministry Accountant General 
Yaron Zelekha announced an unprecedented, three-month campaign, in 
which employees of the state and government ministries are being 
called on to report stolen intellectual property such as patents, 
copyrights, commercial secrets and investigations.  According to the 
announcement, no legal steps will be taken for the duration of the 
campaign. 
 
Maariv reported that US authorities may ask the Israeli online 
gambling company 888 to return profits it made in the US.  The 
newspaper reported that the firm harvested over USD 100 million 
during the years that preceded US legislation against Internet 
gambling. 
 
All media reported that eight workers of the Makhteshim Chemical 
Works plant in Ramat Hovav near Beersheva were injured on Monday 
after inhaling insecticide following an explosion at the facility. 
The media highlighted the possibility that a major environmental 
disaster might have occurred. 
 
Leading media reported on the resignation of Karl Rove, Deputy Chief 
of Staff to President Bush. 
 
------------ 
¶1.  Mideast: 
------------ 
 
Summary: 
-------- 
 
Senior op-ed writer Akiva Eldar commented in the independent, 
left-leaning Ha'aretz: "It is self-evident that [Ehud] Barak knows 
that the contempt he is showing toward contacts with Abu Mazen does 
not help strengthen his position." 
 
Former foreign minister Shlomo Ben-Ami wrote in the 
mass-circulation, pluralist Yediot Aharonot: "In order for Abu Mazen 
to keep the upper hand, more than 'building institutions' is 
needed." 
 
Former Ambassador to the US, former Minister of Foreign Affairs, and 
former Minister of Defense Moshe Arens wrote in Ha'aretz: "The peace 
process can take off only after Palestinian terrorism has been 
decisively defeated." 
 
Block Quotes: 
------------- 
 
¶I.  "Is It a Diplomatic Horizon or a Fata Morgana?" 
 
Senior op-ed writer Akiva Eldar commented in the independent, 
left-leaning Ha'aretz (8/14): "[Secretary of State Condoleezza] Rice 
was one of those who convinced President George W. Bush to skip the 
first stage of the Roadmap, which states that the Palestinian 
Authority is required to destroy the infrastructures of terror.  At 
present, the upcoming international conference is not connected to 
security clauses.... In order to ensure that the international 
conference that bears the name of her boss does not end in failure, 
Rice is trying very hard to bring both sides to the table with an 
agreed-upon paper.  In her view, Barak's remarks that talk of a 
final-status agreement is misleading could prove self-fulfilling. 
The Americans know that when it comes to gaining the support of the 
Palestinian population, the Israeli defense minister has more of an 
impact than the prime minister.  It is self-evident that Barak knows 
that the contempt he is showing toward contacts with Abu Mazen does 
not help strengthen his position." 
 
II.  "Good Intentions Are Not Enough" 
 
Former foreign minister Shlomo Ben-Ami wrote in the 
mass-circulation, pluralist Yediot Aharonot (8/14): "Bush's 
initiative is a last-ditch effort to save the United States' status 
in the region.  The US finds itself on the defensive on all fronts. 
Ironically, the call for an international conference is also a call 
for waging war against Hamas, which won democratic elections and to 
sign a peace treaty with Fatah, which lost those elections. 
Nonetheless, Bush's initiative is not worthless.... Bush almost 
reached former President Clinton's peace plan when he declared that 
the 'borders of the past, the realities of the present, and with 
agreed changes' will determine the solution.  Like Secretary of 
State Rice, he warned Israel with exceptional bluntness that its 
future does not depend on the 'continuation of the West Bank's 
occupation.... [But] the moment the US defined the recognition of 
Israel as the entrance ticket to the conference, it created an 
obstacle preventing Saudi Arabia's participation.... Without the 
Saudis, Bush's summit will be no more than a private party for 
Israel and the Palestinians.... [The American initiative] quite 
matches the Israeli perception, but the Palestinian militias have 
repeatedly shown that they are not prepared to give up the armed 
struggle before they see the establishment of the Palestinian state 
along the 1967 borders with Jerusalem as its capital.  Bush's 
initiative is a fundamental strategic trap based on driving a wedge 
between Abu Mazen's 'moderates' and Hamas's 'extremists.  Still, in 
order for Abu Mazen to keep the upper hand, more than 'building 
institutions' is needed.  Only a comprehensive peace treaty, which 
will answer the core national aspirations of the Palestinians, will 
give him the legitimacy he needs in order to confront the 
radicals." 
 
III.  "Castles in the Air" 
 
Former Ambassador to the US, former Minister of Foreign Affairs, and 
former Minister of Defense Moshe Arens wrote in Ha'aretz (8/14): 
"'Creating' a partner for peace is something unprecedented in the 
history of international relations, and this Israeli-American 
venture will surely be studied in the academic world for years to 
come.  But it is hard to believe that anyone really believes that 
the air so laboriously being pumped into the balloon will not sooner 
or later escape and leave the balloon flat.  This is not the first 
time that Israeli governments have tried their hand at manipulating 
internal Arab politics.  The record is pretty bleak.  It seems to be 
a self-defeating exercise.... Sooner or later it will become clear 
to all that there can be no escape from reality.  The peace process 
can take off only after Palestinian terrorism has been decisively 
defeated." 
 
--------- 
¶2.  Iran: 
--------- 
 
Summary: 
-------- 
 
Deputy Managing Editor and right-wing columnist Caroline B. Glick 
wrote in the conservative, independent Jerusalem Post: "While it is 
possible that Ahmadinejad's economic mismanagement may at the end of 
the day capsize his regime by bankrupting the country, there is no 
reason to believe that this will occur before Iran acquires nuclear 
weapons." 
 
Block Quotes: 
------------- 
 
"Bankrupting Iran Is Not Enough" 
 
Deputy Managing Editor and right-wing columnist Caroline B. Glick 
wrote in the conservative, independent Jerusalem Post (8/14): 
"Unfortunately, the probability that in the foreseeable future 
Iran's economic problems will cause the regime to moderate its 
policies or bring regime opponents to power in Iran's parliament is 
not high.... While it is possible that Ahmadinejad's economic 
mismanagement may at the end of the day capsize his regime by 
bankrupting the country, there is no reason to believe that this 
will occur before Iran acquires nuclear weapons.... it is clear that 
while Iran's economic failure is a positive development which should 
be capitalized and built upon, it alone is no indication that Iran's 
threat to global security is weakening.  To prevent Iran from 
acquiring nuclear weapons and threatening the world in the long run, 
the promotion of its economic failure must be accompanied by 
military policies aimed at destroying its nuclear facilities, and 
political policies aimed at ensuring that Iran's next regime will be 
better than the current one." 
 
JONES