ISRAEL MEDIA REACTION

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SUBJECT: ISRAEL MEDIA REACTION

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SUBJECTS COVERED IN THIS REPORT:
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Mideast

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Key stories in the media:
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Israel Radio, The Jerusalem Post's web site, and the
English-language version of the leading Internet news site Ynet
quoted Secretary of State Condoleezza Rice as saying on Wednesday,
in testimony before a House subcommittee that controls foreign aid,
that the Bush administration will reduce a proposed USD 86-million
security assistance package to the PA government in an effort to see
that none of the money ends up with forces loyal to Hamas.
Secretary Rice was quoted as saying that she would soon send

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Congress a revised package that will ensure only security elements
loyal to PA Chairman [President] Mahmoud Abbas receive the aid.
Israel Radio said that the revised aid would amount to USD 50
million. The media quoted Rice as saying that the inclusion of Hamas
in the government posed a challenge to Middle East peacemaking
because of its refusal to recognize Israel and reject violence to
achieve its aims. The Secretary was quoted as saying: "Frankly, the
formation of the Palestinian unity government has provided something
of a challenge," she said. "The United States is not prepared to
change its assistance policies toward this government because it
does not recognize those foundational principles," Rice clarified.
Media quoted Secretary Rice as saying that the US remained committed
to peace and would carry on contacts with Abbas. She was quoted as
saying that her trip to the region, starting Friday, would
demonstrate that. Ynet cited AP as saying that the Secretary Rice
demanded the end of Palestinian incitement against Israel. Yediot
reported that, in addition to Secretary Rice, many foreign officials
will visit Israel and the PA last week, including UN
Secretary-General Ban Ki-moon, German Chancellor Angela Merkel, and

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other senior EU officials.
The Jerusalem Post reported that more than half of the US House of
Representatives sent a letter to EU policy chief Javier Solana,
which he received on Tuesday afternoon, calling for Europe to stand
firm in refusing aid to the new Palestinian unity government. The
Jerusalem Post wrote that the letter, given to Solana during a visit
with the House's Foreign Affairs Committee, had been signed by 253
representatives, according to the office of Congressman Robert
Wexler (D-FL).
The leading Internet news site Ynet quoted senior GOI officials in
Jerusalem as saying on Wednesday: "The Arab nations must understand
that the right of return is a red line as far as Israel is
concerned." The Yediot-affiliated site noted that PM Ehud Olmert
expects that the Arab League Summit in Riyadh will lead to
significant changes in the Saudi peace initiative, including
dropping the right of return clause. "Arab nations seeking to
advance the Middle East peace process must remove the right of
return from the equation," the state officials were quoted as
saying. Ynet reported that officials in Jerusalem made clear that
Israel considers the right of return a "nonstarter demand."
According to them, as long as Arab nations demand the right of
return, no progress can be made. The other difficult issues, the
1967 borders and East Jerusalem, are open for discussion, but not
the return of Palestinian refugees to the Green Line. The officials
were quoted as saying that, despite Israel's decision to refuse to
cooperate with the Hamas-led Palestinian unity government, the Saudi
initiative is still open for consideration: "As the Prime Minister
said, there are positive elements to this initiative, and we are
willing to seriously consider it. But everything depends on
everything. There is the matter of the Hamas government, which the
government decided to boycott, and there is the Saudi initiative,
which needs amending. One issue cannot progress without the
other."
Israel Radio and Yediot reported that on Wednesday, in a telephone
consultation, the Quartet stated that the Palestinian unity
government does not abide by the Quartet's terms. The media cited
Israel's satisfaction with the declaration.

The Jerusalem Post quoted Israeli officials as saying that both the
proposed new UN sanctions against Iran and the recent Russian
unhappiness with Iranian failure to stop uranium enrichment were
positive signs. The newspaper quoted a senior government official
said in reference to Russia: "It is an encouraging sign when a major
player puts strategic issues before economic interests." He said
that the same could be applied to the Europeans, who have begun
implementing the sanctions called for by US Security Council
Resolution 1737, as well as some parallel economic steps led by the
US aimed at the Iranian economy. The official, however, would not
say whether he believed this would change Iran's decision regarding
its nuclear program. "It's hard to gauge Iranian behavior," the
official was quoted as saying.

In its lead story, Yediot reported that IDF Chief of Staff Lt. Gen.
Gabi Ashkenazi told the cabinet on Wednesday that the rehabilitation
of the IDF will take a long time. All media reported that on
Wednesday last summer's war in Lebanon was officially named the
"Second Lebanon War."

The Jerusalem Post and other media quoted UN officials as saying on
Wednesday that international aid to the Palestinians grew from about
USD 1 billion in 2005 to more than USD 1.2 billion in 2006, despite
a boycott of the Hamas-led PA government.

Dr. Mustafa Barghouti, the new PA Information Minister, was quoted
as saying in an interview with Ha'aretz that relations between
Israel and the Palestinians must be based on full reciprocity.

Ha'aretz reported that the state has not yet formulated its official
stance on the occupation of a Hebron building by hundreds of Jewish
settlers on Monday evening. The defense establishment is still
waiting to hear its legal advisers' positions before taking action.
Ha'aretz wrote that IDF sources told the newspaper on Wednesday that
this could take up to 14 days. In an unrelated development, Ha'aretz
cited a contention by the IDF that a settler community on a military
base in Hebron is "in line with the army's needs." The IDF was
quoted as saying that the settlers are living on the Plugat
Hamitkanim base temporarily, but the community has been there for 16
years. The base is next to Beit Hadassah, a settler quarter in the
city, and is used by the infantry company that defends the region,
as well as several settler families who live in mobile homes.
Ha'aretz said that Peace Now has complained to OC Central Command
Yair Naveh, saying that civilians should not be allowed to live on
an IDF base and that there is no justification for them to do so.
The newspaper wrote that the Central Command has told Peace Now that
the base was captured in 1983 "for security needs and not for
settlement needs." "Nonetheless," the army was quoted as saying,
"in 1991 the Justice Ministry handed down an opinion determining
that the military commander can allow Israeli inhabitants, including
civilians, to enter the territory, for temporary residence, if and
to the extent that it is in line with military needs there."

The Jerusalem Post reported that on Wednesday the High Court of
Justice ordered petitioners against the Citizenship and Entry into
Israel (Temporary) Law to wait until the Knesset amends the
legislation and to then submit new petitions that that address the
law.

Ha'aretz reported that the Association for Civil Rights in Israel is
calling on the Defense Ministry to examine the legality of
preventing Palestinians from accessing Route 60, a main road in the
southern Hebron Hills area of the West Bank.

The Jerusalem Post reported that a former airport security examiner
told the newspaper that ethnic profiling is an unfortunate but
crucial element in the security checks of passengers at Ben-Gurion
and other airports.

Ha'aretz reported that, reversing an earlier stance, former PM Ehud
Barak has told associates in recent weeks that he would not join the
government unconditionally.

Ha'aretz reported that victims of terror and their families could
sue the Postal Bank, a state institution slated for privatization,
for monetary compensation under the law prohibiting the financing of
terror. An investigation by Ha'aretz reveals that in recent years
the bank has transferred hundreds of millions of shekels to security
prisoners convicted of terror activity and serving their sentences
in Israel. The issue in question is funds from the PA, which
supports the prisoners. The funds are officially defined as support
for families of prisoners, but according to indications that
Ha'aretz has obtained from prisoners, a substantial portion of this
money remains with prisoners and their leaders behind bars.

Yediot quoted veterans of the Shaked Commando, which an Israel TV
documentary had said killed Egyptian soldiers during the Six-Day
War, as saying that Olmert and FM Tzipi Livni left them alone to
confront Egyptian incitement.

The media continued to report on the police investigation of Finance
Minister Abraham Hirchson, who is suspected of embezzlement.
Ha'aretz and Israel Radio reported that Attorney General Menachem
Mazuz/the Justice Ministry may suspend Hirchson. Maariv reported
that the police are investigating the possibility that Hirchson
bribed an unnamed senior political figure.

Hatzofe reported that the heads of several faction heads in the
Knesset (National Union - National Religious Party; Meretz; Shas;
and the Pensioners' Party),as well as MKs Danny Yatom (Labor) and
Robert Elituv (Yisrael Beiteinu),have called on Olmert to act
toward the release of convicted spy Jonathan Pollard, who has been
in US jail for over 20 years.

Yediot reported that crime kingpin Zeev Rosenstein will apparently
be returned from Miami to Israel next week to serve the rest of his
prison sentence here.

Yediot reported that Israeli billionaire Yitzhak is buying Las
Vegas' New Frontier Hotel for the sum of USD 1.5 billion.

The media reported that an 8-hour nationwide strike in the public
sector ended on Wednesday after the government promise to disburse
the unpaid salaries of local council employees. Ha'aretz cited the
belief of business sector representatives that the cost of the
industrial action was 170 million shekels (around USD 40.5
million).

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Mideast:
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Summary:
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Diplomatic correspondent Aluf Benn wrote in the independent,
left-leaning Ha'aretz: "Olmert is unpopular not due to poor public
relations, as he claims, but due to his lack of a compass."

Columnist Ari Shavit wrote in Ha'aretz: "An Israeli initiative ...
will not bring an end to the conflict.... But it will create a
gradual change in the situation that will indicate a direction that
Israelis and Palestinians should follow."

Contributor Yonatan Yavin wrote in the mass-circulation, pluralist
Yediot Aharonot: "The problem does not lie with Israel's image, but
in its perception. Any public relations deriving from the latter
would be faulty."

Contributor Guy Maayan wrote in the popular, pluralist Maariv:
"Principle acceptance of the Saudi initiative does not contradict an
unbending rejection of the right of return."

Veteran journalist Alexander Zvielli wrote in the conservative,
independent Jerusalem Post: "Let me appeal to the people of Norway:
Tell your government that Israel has a right to live in peace and
security. And that to do so, the Palestinian government must [abide
by the terms of the Quartet]."

Block Quotes:
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I. "Giving Up the Goal"

Diplomatic correspondent Aluf Benn wrote in the independent,

left-leaning Ha'aretz (3/22): "The Israeli public, which gave Olmert
and his party limited credit even in the elections, sees the
confusion at the top and is reacting with disapproval in the polls.
Olmert is unpopular not due to poor public relations, as he claims,
but due to his lack of a compass. Israelis want to understand where
he is leading them, if at all. What does he want? Has he given up
the division of the country in favor of a renewed partnership with
the settlers? Is Israel on the way to another war in the
territories? Have the demographics changed and the threat to
Zionism been removed?.... Olmert's problem is that given the failure
in Lebanon and the widespread scandals and corruption among the
country's leadership, it is hard for him to convince anyone he still
has some cards up his sleeve.... The time has come for him not to
give the public excuses for what was, but to say where we are going
from here. How we can promote the worthy goal of saving Zionism,
which he posited when he came to power? If he has given up on it,
he should say so and resign. But if the demographic danger is still
threatening Israel, Olmert must show how he will stop it in the time
his government has left. If he continues to hesitate, he will go
down in history as a footnote who spent time on the job between a
failed war and serial investigations."

II. "A Creative Israeli Initiative"

Columnist Ari Shavit wrote in Ha'aretz (3/22): "The internal
Palestinian agreement, the pan-Arab initiative, and the new Haniyeh
government are decisively demanding the right of return. The demand
for the right of return does not accord with an end to the
conflict.... What is needed now is not Israeli enslavement to a
false international discourse totally divorced from reality. What
is needed is a courageous, creative and sober Israeli initiative
that offers thinking out of the box. The Israeli initiative must
have four aspects: Israeli willingness to carry out a limited
withdrawal in Judea and Samaria [i.e. the West Bank] even without a
peace agreement; Palestinian willingness to turn the settlements
Israel evacuates into rehabilitation sites for Palestinian refugees;
commitment by the moderate Arab quartet to fund the rehabilitation
of the refugees and to guarantee that the rehabilitation sites will
not become bases for terror; and renewed international recognition
of Israel as a Jewish and democratic nation state that solves the
problem of Jewish refugees in exactly the same way the future
Palestinian state will solve the problem of Palestinian refugees.
An Israeli initiative in this spirit will not bring an end to the
conflict.... But it will create a gradual change in the situation
that will indicate a direction that Israelis and Palestinians should
follow. It will prove that Israel is giving up the ethos of
settlement while the Palestinians are beginning to move beyond the
ethos of the return. It will prepare the awareness of two tortured
nations for a genuine historical compromise. It will oblige Egypt,
Saudi Arabia and Jordan not only to preach reconciliation but to
take responsibility for what the strategy of reconciliation actually
requires. This is the right thing the moderate West, the moderate
Arabs, and the moderate Israelis can do during this difficult time
in the face of the rise of extremism."

III. "The Entire World Is Against Us"

Contributor Yonatan Yavin wrote in the mass-circulation, pluralist
Yediot Aharonot (3/22): "Even in the United Sates, 'our greatest
friend,' the boycott imposed on the Palestinian unity government
lasted no longer than the time it rakes to swallow a Big Mac. At UN
Headquarters in New York, the red carpet to welcome the 'modern
Hitler,' our pal Mahmoud Ahmadinejad, is being woven. These are
only two blatant, but definitely not unique, examples of the erosion
of the world image of Judaism and Israeliness.... What needs be
done? First of all, [Israel must exercise] maturity, and change its
psychological-national perception. It must get out of the square of
a people whose life is dictated by circumstances, and claim
responsibility fitting a nation among nations. We should stop
comparing ourselves to the Palestinians in the style of 'Who's
right?' because we are a nation -- and what are they? What is
certainly not required is to dispatch the local Condoleezza -- Tzipi
Livni.... The problem does not lie with Israel's image, but in its
perception. Any public relations deriving from the latter would be
faulty."

IV. "Who Is Afraid of the Saudi initiative?"

Contributor Guy Maayan wrote in the popular, pluralist Maariv
(3/22): "The primary goal of the current Saudi initiative is to curb
the destabilization of the regional order.... Principle acceptance
of the Saudi initiative does not contradict an unbending rejection
of the right of return.... [Israel] must make it abundantly clear
that its acceptance des not contradict the fight against terror.
Israel should even demand the integration of moderate elements like
Turkey and the World Bank, and, obviously, demand guarantees from
the US administration regarding the character of the permanent
status and a further upgrading of relations with the US.
Acceptance, however hesitant and reserved, would assist the fight
against Iran more than any populist utterance."


V. "Norway's Dash For Gaza"

Veteran journalist Alexander Zvielli wrote in the conservative,
independent Jerusalem Post (3/22): "Why was Raymond Johansen, the
Norwegian Deputy Foreign Minister, in such a hurry to be the first
European representative to meet Ismail Haniyeh, the prime minister
of the new Palestinian unity government in Gaza?.... I consulted my
old files in our archives to see whether they would help me fathom
Norway's rush to Gaza. Here's what I came upon. It was Norway
that, during World War II, produced the original Quisling -- Vidkun
Quisling.... The very name 'Quisling' still stands for a
betrayal.... Now, after over 2,000 Israelis perished or were maimed
by the Palestinian terror which came in the wake of Oslo, the very
name 'Oslo' has became anathema to most Israelis.... As long as
Europe allows the Arabs to fantasize about "the right of return"
there can be no end to this conflict. But this message has failed
to reach the consciences of the Norwegian government. So let me
appeal to the people of Norway: Tell your government that Israel
has a right to live in peace and security. And that to do so, the
Palestinian government must recognize the agreements signed between
Israel and the PLO; must renounce the threat and use of terrorism
against Israelis; and must recognize the right of the Jewish people
to live as a sovereign nation in the Middle East."

JONES