ISRAEL MEDIA REACTION

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SUBJECT: ISRAEL MEDIA REACTION

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SUBJECTS COVERED IN THIS REPORT:
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1. Mideast


2. Iran

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Key stories in the media:
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Major media reported that the global financial crisis is sparking a
local job market crunch, with Maariv predicting that up to 55,000
Israelis would lose their jobs. (Yesterday the Israel Employment
Service warned that an estimated 3,600 are expected to be lost by
the end of the year and a further wave of job losses in 2009.) All
media highlighted the hostage-talking of 13 Israeli building
contractors and other foreign nationals by hundreds of Chinese
laborers on the Caribbean island of West Caicos. The workers claim
that they have not received their salaries because of financial
problems arising from the collapse of the Lehman Brothers investment
bank. Media reported that seven of the hostages were released last
night.

The Jerusalem Post reported today that the UN General Assembly will
hold a vote on Iran's request to become temporary member of the
organization's Security Council. The newspapers reported that Iran
claims that it wants a nuke-free world. The newspaper reported that
the vote marks the first case of a country under sanction bidding
for a spot on the Council. The Jerusalem Post says that Iran may
get support from Tajikistan and Pakistan, but that it will lose to
Japan.

The Jerusalem Post quoted sources close to PM-designate Tzipi Livni
assaying that she will ask President Shimon Peres on Sunday to give
her a two-week extension beyond MondayQs deadline to form a new
coalition. HaQaretz reported that Kadima officials blasted Finance
Minister Roni Bar-On for refusing to increase child allowances as
Shas is demanding, as the two parties held accelerated coalition
talks yesterday. Maariv and other media reported that Shas is
demanding that Kadima pledge not to include Jerusalem in the
diplomatic negotiations. Makor Rishon-Hatzofe reported that key
Kadima members are opposed to establishing a narrow-based government
and including Meretz in the cabinet.

The Jerusalem Post reported that during the last presidential debate
Sen. Barack Obama gave the first direct indication of who he might
appoint to key foreign policy posts. He pointed to Republican
Senator Richard Lugar and special Middle East envoy Gen. (ret.)
James Jones, who Obama said Qhave shaped my ideas.Q.


Maariv and other media reported that the Gur Hassidic movement has
decided not to support ultra-Orthodox candidate Meir Porush in the
race for Jerusalem mayor, which means that secular candidate Nir
Barkat has increased chances of winning the municipal elections on
November 11. HaQaretz reported that JerusalemQs left-wing secular
residents are in confusion over whom to support in the elections.
The newspaper quoted Dr. Meir Margalit, number two on MeretzQs list,
as saying recently that he prefers to vote for a moderate
ultra-Orthodox candidate than for Barkat, who has taken an extreme
right-wing stance and spoken out against dividing Jerusalem.

Maariv reported that on Wednesday QDeath to the ArabsQ graffiti were
discovered on walls in Jaffa in the wake of the Acre riots.

HaQaretz quoted Palestinian sources in Gaza as saying on Thursday
that Hamas is likely to seek to extend its truce with Israel for
another six months. Israel Radio reported that Hamas has
effectively accepted the extension, including in the West Bank. The
current six-month truce, brokered by Egypt, expires in December. A
senior Hamas official told HaQaretz that the Islamic group has not
yet made a decision on extending the truce. Leading media quoted
the Saudi newspaper Okaz as saying yesterday that top Israeli
negotiator Amos Gilad has informed Egyptian officials that Israel is
prepared to release the 450 prisoners whom Hamas has demanded in
exchange for Gilad Shalit. The media reported that Amos Gilad and
the Defense Ministry have denied the report. Makor Rishon-Hatzofe
quoted Palestinian sources as saying that Shalit will be released
after the Jewish holidays, which end next week.

HaQaretz reported that a report released yesterday by UN
Secretary-General Ban Ki-moon described Hizbullah as a threat to
Middle East security and called for both the Lebanese militant group
and Israel to stop threatening each other through the media. The
report, sent to members of the UN Security Council, also criticized
Syria for allowing weapons smuggling to Lebanese militias.

Israel Radio reported that yesterday a conversation between
Secretary of State Condoleezza Rice and her Syrian counterpart
revolved around the Israeli-Syrian talks.

HaQaretz and Maariv reported that yesterday IDF soldiers shot dead a
Palestinian in the West Bank as he was preparing to throw a fire
bomb at them, in the third such incident in the past three days.

Deputy DM Matan Vilnai was quoted as saying in an interview with The
Jerusalem Post that Israel is Qin the midst of preparing the home
front for war.Q He said that although he believes Iran could not
wipe Israel off the map, it could wreak severe havoc. Still, Vilnai
favors stepping up sanctions before making a military move.

The Jerusalem Post reported that yesterday 1,000 Jews made a
pilgrimage to JosephQs Tomb in Nablus.

The Jerusalem Post reported that yesterday the International
Christian Embassy in Jerusalem announced that a growing list of
prominent Christian ministries has joined the effort to indict
Iranian President Mahmoud Ahmadinejad for incitement to genocide
against Israel.

The Jerusalem Post quoted the Simon Wiesenthal Center as saying that
anti-Semitic tracts can be found throughout Muslim-world bookstands
at the Frankfurt Book Fair, including at the displays of this yearQs
Qhonored guest,Q Turkey.

Maariv reported that because Italy and Britain are considering
pulling out of the F-35 stealth fighter project, there may be a
steep increase in the aircraftQs price. Maariv quoted a senior
Israeli defense source as saying that although Israel is not
deterred by the current economic crisis, but that it will not
purchase the plane at all costs.

Makor Rishon-Hatzofe cited a new report by the NGO Monitor
organization that claims that the number of lawsuits filed in Europe
against senior Israelis has increased.

Leading media reported that Ethiopian-Israeli Tzaga Malko is now in
charge of Israel RadioQs Network A.

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1. Mideast:
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Summary:
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Diplomatic correspondent Aluf Benn wrote in the independent,
left-leaning Ha'aretz: QLivni will have to show understanding for
the situation of the next president and not burden him with a
tiresome list of the threats facing Israel.

Liberal historian Prof. Zeev Sternhell wrote in Ha'aretz: QIf
Israeli society is unable to muster the courage necessary to put an
end to the settlements, the settlements will put an end to the state
of the Jews and will turn it into a binational state.

Block Quotes:
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I. "A Cold Winter Ahead"

Diplomatic correspondent Aluf Benn wrote in the independent,
left-leaning Ha'aretz (10/17): QLivni's main challenge, if indeed
she succeeds Ehud Olmert, will be to develop good relations with
Barack Obama, who appears likely to succeed President Bush in the
White House. This is not only a matter of personal chemistry, but of
understanding the needs and constraints of a weakened America, which
is reeling under a financial crisis and wars in Iraq and
Afghanistan. Livni will have to show understanding for the
situation of the next president and not burden him with a tiresome
list of the threats facing Israel. It will be best for her to
present a diplomatic initiative, display a willingness to make
progress with the Palestinians and the Syrians, and quietly support
an American dialogue with Iran, in return for the U.S. watching out
for Israel's interests. In the long run, a resilient America will
be of greater help than anything else to Israel's security-related
and international standing. Obama will aspire to improve the status
and image of the U.S. internationally, after the nadir reached under
Bush's eight years in office. That effort will oblige him to take
an interest in the Israeli-Palestinian peace process, if only to
placate those who supported him in his run for the presidency.
Israel will have to be careful not to give the impression that it is
hampering Obama's foreign policy, like a kind of vestige from the
Bush period. Accordingly, Jerusalem will have to shy away from
moves that will look like provocations in the international arena,
such as authorizing extensive building in the settlements, at least
until it becomes clear who Obama is and how he is going about the
business of being president. Livni will find it difficult to depend
on the Jewish establishment in the U.S., which for the most part
worked against Obama.


II. "Colonial Zionism"

Liberal historian Prof. Zeev Sternhell wrote in Ha'aretz (10/17):
QFor the past 30 years I have considered the settlements a
destructive phenomenon that raises a large question mark over
Israel's future. In fact, the settlement enterprise is an
ideological, political and social phenomenon that has succeeded in
creating an original androgynous creation: colonial Zionism. There
have already been variations of Zionism: general, revisionist,
socialist, with or without quotation marks. Now we also have
colonial Zionism, based on ethnic and religious inequality, which
considers itself the exclusive emissary of Jewish history.... I have
already written in the past in this newspaper, and I repeat it
today: If Israeli society is unable to muster the courage necessary
to put an end to the settlements, the settlements will put an end to
the state of the Jews and will turn it into a binational
state.Q --------------

2. Iran:
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Summary:
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Diplomatic correspondent Herb Keinon wrote in the conservative,
independent Jerusalem Post: QWhile it is much too early to judge the
impact of the global financial meltdown on Iran or its decisions,
one clear thing is that the fall of oil prices significantly hurts
Tehran.

Block Quotes:
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"Dollars and Sense Q the Good News about Torpedoing Tehran"

Diplomatic correspondent Herb Keinon wrote in the conservative,
independent Jerusalem Post (10/17): QAssessments in Jerusalem are
that, given the current financial crisis, large companies will
l
consider investment in Iran even more carefully, because they will
be less keen on entering into investments in an unstable region.
And this is where the global financial crisis could actually have

some positive residual effect. While it is much too early to judge
the impact of the global financial meltdown on Iran or its
decisions, one clear thing is that the fall of oil prices
significantly hurts Tehran.

CUNNINGHAM