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UNCLAS TEL AVIV 000734 
 
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WHITE HOUSE FOR PRESS OFFICE, SIT ROOM 
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E.O. 12958: N/A 
TAGS: OPRC KMDR IS
 
SUBJECT: ISRAEL MEDIA REACTION 
 
-------------------------------- 
SUBJECTS COVERED IN THIS REPORT: 
-------------------------------- 
 
¶1.  Mideast 
 
¶2.  Afghanistan 
 
------------------------- 
Key stories in the media: 
------------------------- 
 
HaQaretz and other media reported that PM-designate Benjamin 
Netanyahu met last night with a handful of close associates to 
discuss ministerial postings, a move he hopes will ward off 
bitterness among senior Likud figures. Many of them are waiting for 
Netanyahu to fulfill promises he supposedly made during the election 
campaign. Netanyahu, who is to swear in his cabinet on Tuesday, is 
expected to keep the Finance Ministry for himself and appoint Yuval 
Steinitz as a junior  minister below him. Sources close to Netanyahu 
said he had no intention of appointing someone who would become 
acting PM in case of emergency. That post, and that of finance 
minister, are precisely the positions Silvan Shalom had sought; the 
media reported that Shalom has communicated to Netanyahu over the 
past few days that he would prefer no ministerial post at all if 
Netanyahu does not keep his promise to appoint Shalom to a senior 
position.  It is believed Netanyahu intends to appoint Shalom as his 
vice premier and minister for regional development, or minister for 
economic peace and deputy prime minister, hoping this satisfies 
Shalom.  Makor Rishon-Hatzofe reported that the National Union party 
is not likely to join the new government coalition. 
 
All media reported that Shin Bet security service chief Yuval Diskin 
told the cabinet yesterday that tons of military-grade explosives 
and raw materials for making rockets have been smuggled into the 
Gaza Strip since the end of Operation Cast Lead.  Diskin told the 
cabinet that Egypt has gradually improved its operations along the 
border with Gaza, but he said this was not enough.  He was quoted as 
saying: QThere are certain successes.  When there is intelligence 
[from Israel], the Egyptians respond quickly and effectively, but 
there has still been no halt to the smuggling."  Diskin noted the 
drop in the number of rockets fired at Israel in recent weeks; he 
said Hamas was trying harder to prevent such attacks.  According to 
Diskin, Hamas has failed to achieve its goals: agreeing on a 
cease-fire with Israel, Palestinian reconciliation, and the 
reconstruction of the Gaza Strip. "Hamas is debating how to emerge 
from this stalemate.  They are weighing whether to shift to a 
popular-protest mode against Israel's siege or to return to 
terrorism." Diskin was quoted as saying that despite efforts by 
Hamas to ensure calm, Diskin says a few small groups in Gaza 
continue to try to attack Israel. 
 
 
HaQaretz reported that construction activity on West bank 
settlements has increased during the period leading to formation of 
the new government. 
 
HaQaretz and other media reported that yesterday Arab leaders taking 
part in QatarQs Arab League meeting sent Israel an ultimatum: Accept 
the Saudi Peace Initiative or it will be rescinded.  The draft 
proposal of the statement states: "The peace initiative being 
proposed today will not be on offer for a long time. Arab commitment 
to this initiative is dependent on Israeli acceptance."  The draft 
proposal was formulated by the Arab foreign ministers, and will be 
presented to the Arab League's leaders Monday for approval. 
HaQaretz noted that the wording is a compromise between the 
hard-line Arab countries, mainly Syria and Qatar, and the moderates, 
including Egypt and Saudi Arabia.  Israel Radio cited the Lebanese 
daily Al-Akhbar as saying that Egyptian President Hosni Mubarak will 
not attend the summit because Qatar allegedly offered a substantial 
sum of money to Hamas to receive Gilad Shalit instead of Egypt. 
 
Maariv reported that both Israel and the Palestinians QknowQ that it 
is still possible to reach an agreement with Hamas by tomorrow, the 
date when the Netanyahu government will be introduced.  Afterwards, 
Hamas will face representatives of a different government.  Maariv 
quoted a senior official Israeli diplomatic source as saying 
yesterday: "Hamas also knows that these are the last 24 hours." 
Yediot reported that most Hamas prisoners appearing on the list that 
Israel presented to Hamas are willing to be deported. However, 
Yediot noted that a key dispute remains between the parties -Q the 
list itself. 
 
HaQaretz reported that President Shimon Peres launched a campaign a 
few days ago whose aim is to allay the international communityQs 
fears of NetanyahuQs government.  The Jerusalem Post quoted sources 
close to Netanyahu as saying that he refused the demands of two 
coalition partners to insert a clause against a Palestinian state in 
the government coalition agreement. 
HaQaretz reported that allegations of possible illegalities in a 
massive arms deal between Israel and India have surfaced over the 
weekend in the Indian media.  The size of the deal between the 
Indian Ministry of Defense and Israel Aerospace Industries, 
estimated at $1.5 billion, had grown to allow for the payment of 
commissions, which is illegal in India, said the press there.  The 
deal in question is for the delivery of 2,000 Barak Mark VIII 
missiles, which were originally designed as sea-based weapons.  A 
New Delhi daily, DNA, says it has information showing that $120 
million of the overall deal is described as "business expenses." 
According to Josy Joseph, a journalist, officials familiar with the 
deal told him that an IAI representative explained that these costs 
are meant to cover insurance, bank and transportation costs. 
 
The Jerusalem Post quoted American military-law experts as saying 
that investigations of war events must be transparent to achieve 
legitimacy in the court of public opinion. 
 
The Jerusalem Post reported that the Defense Ministry will closely 
monitor the possible lifting of a ban on foreign sales of the F-22 
stealth jet.   The Jerusalem Post cited IsraelQs concern that the 
sale of MiG 31E to Syria could alter the balance of power. 
 
HaQaretz reported that Israel announced yesterday that it plans to 
invest 5.7 million shekels (around $1.36 million) in a religious 
ceremony led by Pope Benedict XVI during his visit in May. 
 
Yediot reported that some Labor Party Qrebels,Q including current 
Education Minister Yuli Tamir, are interested in cooperating with 
Kadima. 
 
Maariv reported that the owners of NetanyaQs Park Hotel are suing 
Hamas, Abbas el-Sayyed, and others for 8.75 million shekels ($2.1 
million) in compensation for the March 2002 Passover night suicide 
bombing in the hotel.  El-Sayyed is slated to be released in the 
Shalit deal.  Leading media reported that on Friday a U.S. judge 
ordered Iran to pay $25 million plus interest to the family of IDF 
soldier Nachshon Wachsman, who was kidnapped and executed by Hamas 
in October 1994. 
 
The Jerusalem Post quoted Foreign Ministry officials as saying 
yesterday that they were unaware of a Chinese spy ring whose 
existence was revealed over the weekend. It reportedly hacked into 
classified documents and private organizations in 203 countries. 
HaQaretz quoted a panel of experts headed by MK Yuval Steinitz as 
saying that Israel can restore its top ranking for flight safety, in 
line with FAA standards. 
 
Leading media reported that Yisrael Beiteinu Chairman Avigdor 
Lieberman has initiated an electoral reform that would give Israeli 
expatriates -- generally considered to be right-leaning -- the right 
to vote abroad. 
 
 
 
 
 
------------ 
¶1.  Mideast: 
------------ 
 
Summary: 
-------- 
 
Senior columnist Nahum Barnea wrote in the mass-circulation, 
pluralist Yediot Aharonot: QWill Obama be willing to subordinate his 
agenda to Israel's agenda, and will Netanyahu be willing to 
accommodate the U.S. president on a series of issues, primarily the 
negotiations on establishing a Palestinian state? 
 
Military correspondent Amos Harel and Palestinian affairs 
correspondent Avi Issacharoff wrote on page one of the independent, 
left-leaning HaQaretz: QIn the short time before Benjamin Netanyahu 
is sworn in as prime minister tomorrow, Israel cannot retreat from 
its public declarations.... Any concession by [Israel or Hamas] 
after such decisive declarations would be seen as surrender.  The 
ball seems to be in Netanyahu's court. 
 
Senior op-ed writer Akiva Eldar commented in Ha'aretz: QOlmert 
should have known that the Palestinians offered their last 
concession 20 years ago. 
 
Block Quotes: 
------------- 
 
¶I.  "Give Bibi a Chance" 
 
Senior columnist Nahum Barnea wrote in the mass-circulation, 
pluralist Yediot Aharonot (3/30): QOstensibly, [the incoming] 
government has a consensus: Netanyahu, Barak, and Lieberman do not 
believe that there is a chance of reaching peace agreements. 
However, the conclusion that each of them has drawn is different. 
Since Barak does not believe any party, he is willing to talk with 
any of the parties.  He believes in an arrangement - a set of 
understandings that will enable security calm between one violent 
round and the next.  Lieberman's rhetoric strives to eradication. 
Netanyahu focuses on the Iranian threat, which he sees as the major 
issue.  According to his view, Israel cannot exist alongside a 
nuclear Iran.  If international pressure on Iran is no use, then 
[Israel] should persuade the U.S. to take military action or should 
prepare for independent military action.  The policy of a 
Barak-style arrangement has no chance of passing in Netanyahu's 
government.  Initiated wars, following Lieberman's approach, also do 
not have much of a chance: It is doubtful whether foreign minister 
Lieberman, will adopt the combative rhetoric of Lieberman from 
Yisrael Beiteinu.  The compromise will be neither eradication nor an 
arrangement, but rather freezing the existing situation.  Except for 
the Iranian issue: This is an issue that cannot be frozen. 
Netanyahu will turn his eyes towards Obama's America: Perhaps 
salvation will come from there.  The question will be double: Will 
Obama be willing to subordinate his agenda to Israel's agenda, and 
will Netanyahu be willing to accommodate the U.S. president on a 
series of issues, primarily the negotiations on establishing a 
Palestinian state?  Netanyahu will be able to obfuscate on the 
matter of the negotiations. 
It is not certain that he will be able to placate his right wing 
partners.  Netanyahu has received a rare gift in politics: A second 
chance as prime minister.  Barak has also received a gift: A second 
chance as defense minister.  Lieberman too: He has been given a 
heaven-sent opportunity to free himself of the empty slogans that 
brought him this far.  The kitchen cabinet in Netanyahu's government 
will be the second-chance club.  Netanyahu presumes, probably, that 
there will not be a third chance.  He will do everything in his 
power so as not to fail.  He deserves a chance: Perhaps this time he 
will succeed. 
 
II.  "Give Bibi a Chance II" 
 
Military correspondent Amos Harel and Palestinian affairs 
correspondent Avi Issacharoff wrote on page one of the independent, 
left-leaning HaQaretz (3/30): QIn the short time before Benjamin 
Netanyahu is sworn in as prime minister tomorrow, Israel cannot 
retreat from its public declarations.  Hamas doesn't want to look 
like it has caved into pressure from Olmert, so it is demanding the 
freedom of the same prisoners whose release Israel says is out of 
the question.  A zero-sum game has thus been created which at the 
moment almost certainly rules out any room for maneuver toward a 
compromise.  Any concession by either side after such decisive 
declarations would be seen as surrender.  The ball seems to be in 
Netanyahu's court -- hopefully now it will be possible to start over 
and try to reinvigorate the talks.  It should not be forgotten, 
however, that Netanyahu inherits his predecessor's red lines.  It 
will be hard for the new prime minister to be seen as someone 
willing to make larger concessions than his predecessor, who is to 
the left of Netanyahu politically.  Despite everything, the Egyptian 
intermediaries refuse to succumb to the pessimism.  They see the 
distance Israel and Hamas have moved in recent months and say 
progress can also be made with a Netanyahu-led government.  The 
attention to the Shalit negotiations obscures another phenomenon, 
however.  The Gaza border is quieter than it has been for months. 
 
III.  "OlmertQs Toxic Legacy" 
 
Senior op-ed writer Akiva Eldar commented in Ha'aretz (3/30): QThere 
was nothing binding in Olmert's talks with Abbas on the core 
issues.... Second, Olmert's Qhair's breadthQ [to peace] extends over 
thousands of acres and goes deep into Palestinian territory.... 
Moreover, had Abbas taken up Olmert's offer on the arrangement for 
East Jerusalem, the Palestinians would have lynched him.... But 
Olmert refused to grant the Palestinian state any symbol of 
sovereignty over the Old City and its cluster of sacred sites.  His 
major concession was his willingness to accept the return of 30,000 
refugees as a Qhumanitarian act.Q  However, this point would not 
have been accepted by Kadima's current leader, Livni.... Olmert 
should have known that the Palestinians offered their last 
concession 20 years ago, when the Palestinian National Council 
decided in Algiers to support the formula of two states for two 
peoples within the 1967 borders.  In return, the PLO received 
American recognition of its demand for self-determination.  The 
decision of the Palestinian National Council survived seven Israeli 
prime ministers and endless crises.  After Olmert and before 
Netanyahu, the question was and has remained: Is there an Israeli 
partner? 
 
---------------- 
¶2.  Afghanistan: 
---------------- 
 
Summary: 
-------- 
 
The conservative, independent Jerusalem Post editorialized: QIt is 
time for the multinational, anti-Islamist alliance to carry a full 
share of the combat burden necessary to defeat -- finally -- Mullah 
Omar and Bin Ladin.   America shouldnQt have to bear the brunt. 
 
Block Quotes: 
------------- 
 
 QObama and Afghanistan 
 
The conservative, independent Jerusalem Post editorialized (3/30): 
QOn Friday, the President unveiled a new, integrated strategy for 
Afghanistan and Pakistan intended to address both counter-insurgency 
and societal development. Nuclear-armed Pakistan, a fractious 
polity if ever here was one, is integral to solving the Afghanistan 
conundrum.  PakistanQs ISI intelligence agency helped establish the 
Taliban, and continues to abet them.... It is time for the 
multinational, anti-Islamist alliance to carry a full share of the 
combat burden necessary to defeat -- finally -- Mullah Omar and Bin 
Ladin.   America shouldnQt have to bear the brunt. 
 
CUNNINGHAM