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UNCLAS TEL AVIV 001161 
 
STATE FOR NEA, NEA/IPA, NEA/PPD 
 
WHITE HOUSE FOR PRESS OFFICE, SIT ROOM 
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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: 
------------------------- 
 
All media reported that Israel has denied that Hizbullah's handover 
of the remains of Israeli soldiers killed in the Second Lebanon War 
was part of a prisoner exchange deal.  The Prime Minister's Office 
said it was surprised by the handover, which took place after Israel 
returned Lebanese spy Nasim Nisr to Lebanon.  But some Israeli 
sources said Hizbullah's handover and Israel's release of Nisr were 
both agreed upon, confidence-building steps that constitute the 
first phase of a more extensive swap that would include Hizbullah's 
release of abducted IDF soldiers Eldad Regev and Ehud Goldwasser. 
Other Israeli sources, however, said the transfer of the remains was 
orchestrated to win over public opinion in Lebanon by giving the 
impression that it was part of a prisoner exchange.  The Jerusalem 
Post reported that a Hizbullah official told the newspaper that 
Nisr's release and the return of body parts of IDF soldiers are part 
of a "framework of an exchange of captives between the resistance in 
Lebanon and the Zionist entity." 
 
Leading media quoted PM Ehud Olmert as saying yesterday that Kadima 
would not be pressured into changing the election schedule, in a 
barb aimed at the Labor Party chairman Ehud Barak who has threatened 
to force early elections if Olmert is not ousted.  Olmert also 
indirectly criticized FM Tzipi Livni.  Yesterday major media 
reported that Olmert agreed to primaries in Kadima, but that he 
asked that the process begin only when he returns from the U.S. next 
weekend. 
 
Maariv reported that a majority of cabinet ministers is opposed to a 
truce deal with Hamas.  Yesterday Yediot reported that senior 
officials in Fatah are afraid that a cease-fire will bolster Hamas's 
strength in Gaza, weaken Abbas even further, and deepen the 
separation between the West Bank and the Gaza Strip.  Over the 
weekend media reported that Egyptian police in Sinai have discovered 
30 anti-aircraft missiles.  They were said to be destined for Gaza. 
Yesterday Yediot reported that the Chief of Staff of Olmert's 
Bureau, Yoram Turbowicz, left a number of days ago for an 
unscheduled visit to Washington in order to prepare the ground for 
OlmertQs visit to the United States that is to begin on Monday 
night.  Turbowicz returned to Israel before dawn on Thursday.  One 
of the purposes of his trip was to reach an understanding with the 
Americans about the security package that Israel is to receive in 
order to improve its ability to cope with Iran.  Turbowicz was 
accompanied by a number of representatives of the Mossad and other 
security officials.  The trip was also linked to the dramatic 
statement about the resumption of peace negotiations between Israel 
and Syria, which was received with displeasure by the U.S. 
administration.  Turbowicz passed on assurances from Olmert that the 
Syrian track would not be promoted at the expense of the Palestinian 
track. 
 
Ha'aretz reported that PA President Mahmoud Abbas told senior 
Israeli officials recently that there were still major gaps between 
Israel and the PA in negotiations.  Abbas was quoted as saying that 
the parties do not appear to be moving toward closure on core 
issues, although the gaps were becoming more clearly defined; he 
added that more time was needed.  The media reported that PM Olmert 
and Abbas will meet this afternoon at Olmert's official residence in 
Jerusalem ahead of Olmert's visit to Washington this week.  Ha'aretz 
quoted a senior Israeli negotiator as saying behind closed doors 
last week that the parties were still far from the type of 
concessions that would lead to a breakthrough.  He added that the 
Palestinians wanted Israel to first fully recognize Palestinian 
rights, and only then would the Palestinians agree to make 
compromises.  Media reported that Vice PM Haim Ramon is urging PM 
Olmert to publicize agreements reached between Israeli and 
Palestinian negotiation teams and that he said yesterday in the U.S. 
that the differences on final status issues are "minor."  His goal 
reportedly is to make sure that neither the time nor the efforts 
that were invested by the two parties on their way to a final status 
arrangement were wasted.  Israel Radio quoted senior Palestinian 
negotiator Saeb Erekat as saying that Abbas will ask Olmert to 
invalidate the tender to build 800 apartments in East Jerusalem. 
The radio quoted senior Palestinian official Yasser Abed Rabbo as 
saying in an interview with the Palestinian newspaper Al-Hayat 
Al-Jadida that Israeli negotiators have not presented maps of 
Jerusalem, which proves their lack of seriousness in the matter. 
 
Yesterday Maariv reported that it has learned from Turkish officials 
that the foreign ministers of Israel and Syria are due to meet for 
the first time at the end of August for a summit meeting that will 
give the signal for the start of direct negotiations in the peace 
process between the sides.  Yesterday Ha'aretz reported that Israeli 
diplomatic missions in Europe were issue instructions from Jerusalem 
to ask European capitals to exercise "caution" in their contacts 
with Damascus, because it has yet to prove the seriousness of its 
intent regarding the negotiations. 
 
Ha'aretz reported that yesterday the State Prosecutor's Office told 
the High Court of Justice that Israel would not allow two Gaza Strip 
students to leave the Strip for the U.S., where they had received 
Fulbright scholarships.  Despite pressure from the State Department, 
Israel maintained that it was allowing people in or out of Gaza for 
humanitarian reasons only, which according to international law did 
not include studying abroad.  The inter-senate committee of Israel's 
universities protested the decision in a letter to Defense Minister 
Ehud Barak, calling it a blow to freedom of research and suggesting 
it might have been a mistake by lower governmental echelons who did 
not understand the scholarship's significance.  Yesterday The 
Jerusalem Post reported that officials in the Prime Minister's 
Office expressed "suspires" at State Department criticism of Israel 
in the matter.  The Jerusalem Post quoted the Knesset's Education 
Committee chair Michael Melchior as saying that Israel's policy 
contravened international conventions and the values of the Jewish 
state. 
 
The Jerusalem Post reported that an IDF soldier was moderately 
wounded on an IDF operation in southern Gaza over the weekend.  Grad 
rockets were launched at the western Negev. 
 
Makor Rishon-Hatzofe reported on suspicions that former Argentine 
president Carlos Menem whitewashed the findings of the investigation 
of the 1994 blast of the Jewish community building in Buenos Aires. 
 
 
Several media cited London's Sunday Times as saying that FM Livni 
was a Mossad agent in early 1980s when it ran a series of missions 
to kill Palestinian terrorists. 
 
Most media marked "Jerusalem Day," which celebrates 41 years of the 
reunification of Jerusalem. 
 
The Jerusalem Post reported on a "massive 60th birthday party" in 
Washington that was held for Israel yesterday, followed by an AIPAC 
conference today. 
 
Yesterday The Jerusalem Post reported that members of Congress are 
urging the Bush administration to remove Israel from an intellectual 
property watch list the harms its international standing and could 
make it harder for the country to join the Organization of Economic 
Cooperation and Development. 
 
The media reported that Yad Vashem Council Chairman Yosef (Tommy) 
Lapid, a former justice minister, journalist, and outspoken critic 
of the ultra-Orthodox religious establishment, died yesterday at 
¶77. 
 
The Jerusalem Post quoted a senior IAF officer as saying lat week 
that Lockheed Martin should take responsibility for formaldehyde 
found in the cockpit of F-16I planes.  The officer was quoted as 
saying that the company fears that an admission would impact sales. 
 
The Jerusalem Post reported that Bank Hapoalim agreed to buy a 
majority stake in    New York wealth-management firm NuVerse 
Advisors LLC for $34 million to expand the private banking 
business. 
 
 
 
 
 
 
 
 
 
 
------------ 
¶1.  Mideast: 
------------ 
 
Summary: 
-------- 
 
The independent, left-leaning Ha'aretz editorialized: "It's still 
not too late to cancel Olmert's superfluous and damaging trip to 
Washington, which is reminiscent of a similar trip by president 
Richard Nixon to Israel (and Egypt) in the summer of 1974." 
 
Arab affairs correspondent Jacky Hoogie wrote in the popular, 
pluralist Maariv: "The man who always calls Israel the 'enemy' and 
promises that the countdown toward its vanishing from the map has 
begun -- this same Nasrallah forced on Israel a humanitarian gesture 
from him." 
 
Intelligence affairs reporter Ronen Bergman wrote in the 
mass-circulation, pluralist Yediot Aharonot: "A European source told 
Yediot Aharonot last night that as part of the dialogue, the U.S. 
asked Iran for a confidence building gesture between the sides.... 
Nasrallah wants to again brand himself a pan-Lebanon leader ... 
therefore, today's bottom line is cautious optimism that [abducted 
IDF soldiers] Regev and Goldwasser will soon return home." 
 
The ultra-Orthodox Hamodi'a editorialized: "Those who returned the 
coffin are not human and didn't intend to carry out a human 
gesture." 
 
Block Quotes: 
------------- 
 
¶I.  "A Damaging and Superfluous Trip" 
 
The independent, left-leaning Ha'aretz editorialized (6/2): "Prime 
Minister Ehud Olmert is scheduled to leave tonight for Washington on 
a trip that just might be his farewell visit as prime minister to 
the American capital.... Wherever he goes, he will be shadowed by 
the cloud of suspicions of public and criminal corruption that 
hovers above him.... It will be an embarrassing spectacle that will 
last several days and add to Israel's disgrace.... This is 
especially true of the White House, where Olmert will meet with 
President George W. Bush. Olmert's associates have been hinting that 
fateful issues - a code name for the Iranian nuclear program - will 
be discussed at this meeting. It is possible that the two will 
discuss this issue again, but it is hard to believe that there have 
been any dramatic changes since their previous meeting in Jerusalem 
just a few weeks ago.... By refusing to resign, or at the very least 
declare himself incapacitated for the coming months, Olmert is 
sentencing his government to a slow death, instead of granting it 
the grace of departing in one fell swoop.  If it is important to him 
how he goes down in Israeli history, he must also consider what this 
last chapter will look like.  It's still not too late to cancel 
Olmert's superfluous and damaging trip to Washington, which is 
reminiscent of a similar trip by president Richard Nixon to Israel 
(and Egypt) in the summer of 1974, a few weeks before he was forced 
to resign in disgrace....The meeting with Bush should be left for 
the next prime minister, who will be able to make decisions that 
Olmert is currently incapable of making." 
 
II.  "When Nasrallah Wants to Give" 
Arab affairs correspondent Jacky Hoogie wrote in the popular, 
pluralist Maariv (6/2): "Something strange happened to Hassan 
Nasrallah yesterday: The polished rhetorician from Beirut, the man 
who always calls Israel the 'enemy' and promises that the countdown 
toward its vanishing from the map has begun -- this same Nasrallah 
forced on Israel a humanitarian gesture from him.... Nasrallah 
needed this staged deal today more than ever before.  A month after 
igniting Lebanon in blood and fire, and subjugating his political 
rivals by force, Hizbullah needs points among the public after 
showing that its guns, unlike its statements, are also aimed at the 
Lebanese themselves.  And not only that: Nasrallah too, like Olmert, 
is committed to the families of the Lebanese prisoners, headed by 
the Kuntar family, which is waging a public campaign for his 
release.  Furthermore, the Hizbullah leader hopes that even though 
this wasn't coordinated with his enemies, his gesture will still 
soften IsraelQs position in the negotiations.  YesterdayQs absurd 
show in Nakura [the western border crossing with Lebanon] attests to 
the cynicism in which the negotiations are held and the bitter and 
painful reality of the families, in which even body parts become 
legal tender.  However, more than anything else, it shows that 
Nasrallah has no real achievement to sell to his public in this 
affair.  Had he something valuable in his hands, he would have 
prepared his audience for a grand show, and not this minor 
exhibition." 
 
 
III.  "Iran Exerted Pressure" 
 
Intelligence affairs reporter Ronen Bergman wrote in the 
mass-circulation, pluralist Yediot Aharonot (6/2): "According to 
knowledgeable international sources, two parallel processes led to 
progress in the negotiations [with Hizbullah], even though its end 
will be under conditions that are less good for Hassan Nasrallah. 
The first process is the indirect dialogue between the U.S. and Iran 
in the multi-national forum discussing IraqQs future.  A European 
source told Yediot Aharonot last night that as part of the dialogue, 
the U.S. asked Iran for a confidence building gesture between the 
sides, and that as a result, Tehran put pressure on Hizbullah to 
conclude the affair of the captives.  In tandem, says the European 
source, Hizbullah has been suffering from relative weakness this 
past year, and the latest outbreak of violence in Lebanon should be 
seen in this light.   The Israeli Mossad and European intelligence 
agencies disagree on the question whether the Doha conference that 
ended the political crisis in Lebanon and the recent events there is 
good or bad for Hizbullah.  The Mossad claims that reaching 
agreement on the appointment of a new president in Lebanon and 
strengthening the Shi'ite bloc is a sign of Hizbullah's gaining in 
power, and that these events are of great concern.  Their European 
colleagues interpret the events in precisely the opposite manner. 
The progress in the negotiations should be seen against the backdrop 
of Hizbullah's weakening, says the European source.  Nasrallah wants 
to claim quick achievements for himself, even at the price of 
relinquishing some of his first demands.  The excessive festivities 
that Nasim Nisr received should also be viewed in the same way. 
Nasrallah wants to again brand himself a pan-Lebanon leader, someone 
who not only looks out for the Shi'ites but also for Druze Samir 
Kuntar, and therefore, today's bottom line is cautious optimism that 
[abducted IDF soldiers] Regev and Goldwasser will soon return 
home." 
 
IV.  "Facing the Devoid of Humanity" 
 
The ultra-Orthodox Hamodi'a editorialized (6/2): "The very human act 
that occurred yesterday along the Lebanese border -- the return of a 
coffin containing body parts that Hizbullah says are of Israeli 
soldiers -- should fool no one.  Those who returned the coffin are 
not human and didn't intend to carry out a human gesture.  What they 
want is to continue playing on the feelings of bereaved families and 
add to their suffering.  They did not do it before they learned that 
the Israeli side doesn't intend to let them [trade with body parts]; 
they did it on the very day a Lebanese spy was released from Israeli 
jail, in order to make the coffin's return appear as part of a 
prisoner exchange." 
 
--------- 
¶2.  Iran: 
--------- 
 
Summary: 
-------- 
 
The Director of the Interdisciplinary Center's Global Research in 
International Affairs Center, columnist Barry Rubin, wrote in the 
conservative, independent Jerusalem Post: " Obama is so scary and is 
accused of appeasement not because he wants to meet enemies in 
person, but because he doesn't want to meet to meet them in 
struggle.... That's why Obama is both a dangerously naive amateur, 
and a leftist posing as a liberal." 
 
Block Quotes: 
------------- 
"Broken Engagements" 
 
The Director of the Interdisciplinary Center's Global Research in 
International Affairs Center, columnist Barry Rubin, wrote in the 
conservative, independent Jerusalem Post (6/2): "[Senator Obama] 
favors direct presidential diplomacy with Iran, without 
preconditions.  A normal liberal concept of foreign policy is alien 
to him.  What he should be saying is: ... 'If Iran gives up its 
extremism, we are ready to offer friendship'.... But Obama has never 
said anything like this.  He has no concept of toughness as a 
necessary element in flexibility, nor of deterrence as a 
precondition to conciliation. Nor does he indicate that he would be 
steadfast if engagement failed.  He defines no U.S. preconditions 
foe meeting or conditions for agreement.  He offers to hear Iran's 
grievances, but says nothing about American grievances.  Radical 
Islamists interpret this strategy as weakness -- of which they will 
take full advantage.... Obama is so scary and is accused of 
appeasement not because he wants to meet enemies in person, but 
because he doesn't want to meet to meet them in struggle.... That's 
why Obama is both a dangerously naive amateur, and a leftist posing 
as a liberal." 
 
JONES