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UNCLAS TEL AVIV 001304 
 
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 
 
¶3.  U.S.-Israel Relations 
 
------------------------- 
Key stories in the media: 
------------------------- 
 
All media reported that Egypt and Hamas announced on Tuesday that a 
cease-fire (tahdiya) between Israel and the Palestinians in the Gaza 
Strip will go into effect at 6 A.M. tomorrow.  Media reported that 
negotiations over the release of Gilad Shalit will resume on Sunday. 
 Israel may reopen the Rafah border crossing between Egypt and Gaza. 
 (Some media reported that this is a done deal.)  Israel Radio 
reported that while PM Ehud Olmert and Defense Minister Ehud Barak 
approved the agreement, senior ministers and the IDF were skeptical 
that it would hold up.  Defense Ministry official Major General 
(res.) Amos Gilad left yesterday for Cairo to conclude the final 
agreement.  Makor Rishon-Hatzofe and Israel Radio quoted Vice PM 
Haim Ramon as saying that the accord constitutes a victory for 
radical Islam.  Right-wing politicians were quoted as saying that 
the accord represents a legitimization of Hamas.  Israel Radio 
reported that Syrian FM Walid Muallem commended the truce. 
 
Israel Radio reported that White House and State Department 
spokespeople expressed doubts about the tahdiya.  The radio said 
that State Department Spokesman Tom Casey was more optimistic than 
his White House counterpart. 
 
Major media reported that at least seven Palestinians were killed 
yesterday in three IAF strikes in Gaza that seemed to target the 
radical Army of Islam organization, which was involved in Shalit's 
kidnapping.  Eight Qassam rockets landed in the western Negev this 
morning. 
 
Ha'aretz reported that the U.S. has begun mediating between Israel 
and Lebanon in an effort to resolve their dispute over Sheba Farms 
in the hope that they would then start peace talks.  Ha'aretz 
reported that President Bush and Secretary of State Condoleezza Rice 
informed PM Olmert of this during his visit to Washington two weeks 
ago, and that Rice repeated it during her visit here earlier this 
week.  Ha'aretz quoted a senior Israeli official as saying that Rice 
gave Lebanon a message from Olmert on this issue on Monday. 
Ha'aretz quoted the London-based Arabic daily Al-Hayat as saying 
yesterday that during her brief visit to Beirut on Monday, Rice told 
Lebanese officials that the U.S. was working to obtain an Israeli 
withdrawal from Sheba.  "Our efforts are continuing, and will be 
stepped up in the coming weeks," Al-Hayat quoted Rice as saying. 
The Jerusalem Post reported that a senior IDF Intelligence officer 
told the Knesset's Foreign Affairs and Defense Committee yesterday 
that since the end of the Second Lebanon War, Hizbullah has amassed 
an underground military infrastructure under the noses of UNIFIL. 
 
The Jerusalem Post quoted Fatah officials as saying that PA 
President Mahmoud Abbas is planning to visit Gaza for the first time 
since Hamas's violent takeover of the area. 
 
The Jerusalem Post reported: "U.S. Ambassador Richard Jones is 
scheduled to leave his post on July 11, even though it is not yet 
clear when -- and even if -- his announced replacement, James 
Cunningham, will arrive." 
 
The Jerusalem Post quoted a senior IDF commander as saying yesterday 
that the Civil Administration in the West Bank has negotiated a deal 
with a number of Palestinian villages in the Qalqilya region in 
which dirt roadblocks cutting off their access to nearby cities and 
roads would be lifted in exchange for the cessation of local terror 
activity. 
 
Ha'aretz reported that two senior officials in the Civil 
Administration allegedly illegally collaborated with Jewish land 
dealers to take over land in the West Bank, according to an 
indictment issued yesterday in the Jerusalem District Court.  Lt. 
Col. Yair Blumenthal and Maj. Ehud Brosh have been charged with 
taking bribes and favors from the dealers, brothers Yosef and Yaakov 
Amram.  Blumenthal, who headed of the Civil Administration's 
infrastructure department, is charged with helping the brothers 
further fraudulent business deals by providing them with internal 
documents and equipment belonging to the Civil Administration in 
exchange for over $40,000.  The land is said to have been used to 
expand settlements in the Jericho and Hebron areas. 
 
Various media reported that President Shimon Peres left for Petra 
today for a meeting of Nobel Prizewinners and a meeting with King 
Abdullah II.  The radio quoted the King as saying that Israel is 
delaying the two-state vision. 
 
The Jerusalem Post reported that "in a surprising show of right-wing 
strength," 42 Knesset members -- including coalition members -- 
signed onto a bill Tuesday that would allow settlers to return to 
the sites of the four northern West Bank settlements evacuated 
during the 2005 disengagement.  The bill is unlikely to pass. 
 
All media reported that Bank Leumi Britain CEO Menachem "Miki" 
Friedman was arrested yesterday morning on suspicion of fraud and 
bribery of involving loans worth 25 million shekels (around $ 7.5 
million) during his tenure as the bank's central branch manager. 
Thirteen other prominent businessmen suspected of involvement in the 
bribery, including the CEO of a furniture company, a former soccer 
player, owners of well-known Tel Aviv restaurants, and the CEO of an 
airline, were arrested along with Friedman.  Suspicions concerning 
bribery and irregularities in the granting of bank loans relate to 
just a few months during 2007, toward the end of Friedman's 
five-year tenure as branch manager. 
 
Ha'aretz reported that yesterday visiting Los Angeles Mayor Antonio 
Villaraigosa and Tel Aviv Mayor Ron Huldai signed a cooperation 
agreement for the rehabilitation of rivers. 
 
 
 
 
 
 
 
------------ 
¶1.  Mideast: 
------------ 
 
Summary: 
-------- 
 
Senior Middle East affairs analyst Zvi Bar'el wrote in the 
independent, left-leaning Ha'aretz: "Hamas has ... succeeded in 
using the truce to create an internal political front -- and even 
more importantly, to gain the Arab world's recognition of its 
status." 
 
Security and intelligence affairs commsentator Amit Cohen wrote in 
the popular, pluralist Maariv: "Hamas, which has exclusive control 
of Gaza, stands to gain significantly from the implementation of the 
cease-fire, but may also pay the price for its violation." 
 
Military correspondent Alex Fishman wrote on page one of the 
mass-circulation, pluralist Yediot Aharonot: "Both weak governments 
on either side of the fence in Gaza have an interest in [the 
truce's] success.  Only one party has an interest in sabotaging this 
story: the Iranians." 
 
Uri Elitzur, who was director of former prime minister Benjamin 
Netanyahu's bureau, wrote in the editorial of the nationalist, 
Orthodox Makor Rishon-Hatzofe: "It is clear that this isn't a 
cease-fire in exchange for a cease-fire, but capitulation to violent 
extortion -- of the 'offer you can't refuse' kind from gangster 
stories." 
 
Block Quotes: 
------------- 
 
¶I.  "Hamas in Charge" 
 
Senior Middle East affairs analyst Zvi Bar'el wrote in the 
independent, left-leaning Ha'aretz (6/18): "The main points of a 
cease-fire between Israel and Hamas grant the Islamic organization a 
political and diplomatic achievement that will also give it a lever 
in its reconciliation talks with Fatah, which are slated to begin at 
the end of this week.... Israel will receive quiet in the south, 
along with an Egyptian pledge to monitor the border closely, but 
Hamas will be the main party in control of the Rafah crossing. 
Palestinian Authority officials and European observers will be 
present, but both will have limited authority.  Moreover, the truce 
gives Hamas, rather than PA President Mahmoud Abbas, the power to 
force a cease-fire in the West Bank: If quiet is maintained in the 
south, Israel will have to extend the truce to the West Bank in 
another six months.... Hamas has also succeeded in using the truce 
to create an internal political front -- and even more importantly, 
to gain the Arab world's recognition of its status." 
 
II.  "Relative Calm" 
 
Security and intelligence affairs commentator Amit Cohen wrote in 
the popular, pluralist Maariv (6/18): "Hamas, which has exclusive 
control of Gaza, stands to gain significantly from the 
implementation of the cease-fire, but may also pay the price for its 
violation.  Hamas figures are optimistic about their chances of 
breaking the siege on the Gaza Strip.  This step is of immense 
significance, not only economically, but mainly for morale.  If the 
crossings open, Hamas will be able to tell its supporters: Our 
persistence has paid off, we didn't yield and made Israel back down. 
 Conversely, if the agreement collapses, the chances of a 
large-scale military operation increase.  Hamas has prepared for 
such an operation and believes that it will be able to survive it, 
but it is not interested in such a development.  This is the reason 
that Hamas will try to the best of its ability to rein in the other 
organizations, but without appearing as if it is infringing upon 
their right to act against Israel.  Unsurprisingly, the Palestinian 
Authority was the most worried party yesterday.... [PA officials] 
know that a cease-fire, if it is implemented seriously, will reduce 
even further the chances of collapsing the Hamas regime in Gaza. 
This is the reason that Palestinian security officials repeatedly 
warn that Hamas intends to take advantage of the cease-fire to arm 
itself, strengthen its abilities even further and prepare for the 
next round." 
 
III.  "Alliance of the Weak" 
 
Military correspondent Alex Fishman wrote on page one of the 
mass-circulation, pluralist Yediot Aharonot (6/18): "Starting on 
Thursday at 6:00 A.M., Israel is giving Hamas recognition as a 
legitimate player in Palestinian and regional politics.  In 
exchange, it is receiving calm for a certain period of time for the 
residents of the Gaza perimeter.  This, in essence, is the deal that 
we have made with the Egyptians.  Everyone complains about this 
arrangement.  They say that it's bad, that it won't last, and that 
it is fragile.  But this arrangement is taking form for one reason: 
Both weak governments on either side of the fence in Gaza have an 
interest in its success.  Only one party has an interest in 
sabotaging this story: the Iranians.  They will make an effort to 
dismantle the package by means of Islamic Jihad.  Here Hamas will be 
put to the test: Is it indeed an Iranian extension, or is it only 
using Iran for its own needs?  Until then, what happened and will 
happen in the 24 hours prior to the truce is a game: Who will come 
out more of a man, who will give the last blow and who will fight 
until the last moment for his terms.  This is how Hamas is behaving, 
this is how we too are behaving." 
 
IV.  "An Agreement with Gangsters" 
 
Uri Elitzur, who was director of former prime minister Benjamin 
Netanyahu's bureau, wrote in the editorial of the nationalist, 
Orthodox Makor Rishon-Hatzofe (6/18): "The price that Israel has 
agreed to pay Hamas for the cease-fire is still unknown.  Perhaps it 
is turning a blind eye to smuggling of heavy weaponry into the 
Strip; perhaps it is money; perhaps it the opening of crossings from 
Gaza to Judea and Samaria [i.e. the West Bank].  Anyway, it is clear 
that this isn't a cease-fire in exchange for a cease-fire, but 
capitulation to violent extortion -- of the 'offer you can't refuse' 
kind from gangster stories.  Giving in to blackmail will never bring 
durable peace, because it is absolutely obvious that the blackmailer 
will try his luck again.  As the Romans said, 'If you want peace, 
prepare for war.'  It was possible to reach a simple, mutual, and 
durable cease-fire, had Israel shown determination to fight the 
Qassam rocket fire until it was overcome." 
 
--------- 
¶2.  Iran: 
--------- 
 
Summary: 
-------- 
 
The conservative, independent Jerusalem Post editorialized: "Even 
the U.S., with the best of intentions, has not found it easy to 
impose a comprehensive sanctions regime [on Iran].  Which is why we 
applaud U.S. Senator Max Baucus for his efforts to plug existing 
loopholes in American law." 
 
 
 
 
 
Block Quotes: 
------------- 
 
"Prodding the Glacier" 
 
The conservative, independent Jerusalem Post editorialized (6/18): 
"The glacial pace at which Europe has been working to get Iran to 
end its enrichment of uranium and give up its nuclear weapons 
program is slowly picking up.  Britain and Europe are expected to 
freeze the assets of Bank Melli, the Islamic Republic's main 
financial conduit to the world and its channel for cash transfers to 
Hamas and Islamic Jihad.  The EU is also weighing sanctions against 
companies that invest in Iran's energy industry.  For its part, Iran 
has reportedly begun shifting cash out of European banks -- $75 
billion so far.... [But] Europe is thus still instrumental in 
keeping Teheran's economy afloat, yet it is doing precious little to 
explicitly isolate Iran.  Regular international flights to the 
Islamic Republic still take off from most major European airports, 
and European countries maintain active embassies in Tehran.... Even 
 
the U.S., with the best of intentions, has not found it easy to 
impose a comprehensive sanctions regime.  Which is why we applaud 
U.S. Senator Max Baucus for his efforts to plug existing loopholes 
in American law." 
 
-------------------------- 
¶3.  U.S.-Israel Relations: 
-------------------------- 
 
Summary: 
-------- 
 
Former Ambassador to the U.S., former Minister of Foreign Affairs, 
and former Minister of Defense Moshe Arens wrote in the independent, 
left-leaning Ha'aretz: "No one has been as blatant as Olmert when he 
declared that the next [U.S.] administration would not be as 
friendly to Israel as the present one.... If at all, the contrary 
should have been said: We expect the relationship with the next 
administration, regardless of who is elected president of the United 
States, to be even better." 
 
 
 
 
 
 
 
Block Quotes: 
------------- 
 
"Apres Moi le Deluge" 
 
Former Ambassador to the U.S., former Minister of Foreign Affairs, 
and former Minister of Defense Moshe Arens wrote in the independent, 
left-leaning Ha'aretz (6/18): "The U.S.-Israeli relationship is 
based on firm foundations of common values, ideals and strategic 
interests that do not depend on whether the administration in 
Washington is Republican or Democratic.  The relationship is a major 
part of Israel's strategic posture and should not be impaired by 
Israeli politicians under any circumstances.  Although some Israeli 
prime ministers have in the past made the unfortunate mistake of 
indicating their preference for one of the candidates in the 
American presidential elections, until now, no one has been as 
blatant as Olmert when he declared that the next administration 
would not be as friendly to Israel as the present one.  That 
statement is certainly not likely to advance our country's 
relationship with the next administration.  If at all, the contrary 
should have been said: We expect the relationship with the next 
administration, regardless of who is elected president of the United 
States, to be even better." 
 
JONES