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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HaQaretz quoted sources close to PM Benjamin Netanyahu as saying
that he will announce in his foreign policy speech scheduled for
Sunday the adoption of the Roadmap and the "two-state solution" for
settling the Palestinian-Israeli conflict. The sources said the
speech will "revolve around the Roadmap." Netanyahu will present a
few conditions for the implementation of the Roadmap, above all a
Palestinian recognition of Israel as the homeland of the Jewish
people. He will also demand that the future Palestinian state be
demilitarized. The prime minister will reportedly propose the
immediate renewal of negotiations with the PA on the basis of a
formula that will allow for self-government as long as the
Palestinians do not endanger Israel. In his speech at Bar-Ilan
University, near Tel Aviv -- a bastion of Israel's
national-religious movement -- Netanyahu will discuss at length the
opportunity that has been created for cooperation between Israel and
the Arab states in light of shared concerns about Iran's nuclear
program. Netanyahu will reportedly propose a regional process in
which Arab states will initiate the normalization of ties with
Israel, parallel to the Israeli-Palestinian negotiations. In
recent days, Netanyahu has asked his aides to collect data on the
settlements. HaQaretz quoted sources close to the PM as saying that
Netanyahu will not announce during his speech a freeze on
construction in the settlements, as the U.S. has insisted Israel
must do. Netanyahu will reportedly declare that the settlements in
the West Bank are not an obstacle to peace.

All media reported that Likud Knesset members that Netanyahu met in
his office yesterday pleaded with him not to utter the catchphrase
Qtwo states for two peoplesQ when he delivers his policy address.
Cabinet minister Benny Begin declared at the meeting that Qif the
only solution is two states for two peoples, then there is no
solution.Q He denied statements from Egyptian President Hosni
Mubarak that he had already decided to endorse the formation of a
Palestinian state in the speech. However, The Jerusalem Post
reported that he hinted that he would use the threat of a nuclear
Iran to justify additional steps to meet President ObamaQs demands.

HaQaretz quoted a Jerusalem source as saying that the talks between
Netanyahu and U.S. Special Envoy George Mitchell "resulted in a
great deal of progress," as a consequence of the more flexible
proposals put forth by Netanyahu on the settlements. HaQaretz
reported that a senior Washington source confirmed that progress had
been achieved, but stressed that "our position on the need to cease
settlement construction has not been altered at all. The talks were
good and we will continue in a few days." NetanyahuQs bureau
refused to comment. Yediot reported that the U.S. administration is
trying to convince Israel and the Palestinians to reach
understandings in principle regarding land exchanges that would
allow Israel to continue building in settlement blocs. According to
Yediot, Mitchell suggested that Israel retain the settlement blocs
and hand over land within the Green Line to the Palestinians
encompassing the same area as the blocs. The Jerusalem Post quoted
Mitchell as sayng after his talks with opposition leader Tzipi Livni
yesterday that peace for Israel includes Syria and Lebanon.

All media reported that yesterday James Von Brunn, an 89-year-old
linked to an anti-Semitic Web site, opened fire with a rifle inside
WashingtonQs crowded U.S. Holocaust Memorial Museum, killing a
security guard before being shot and wounded. Media quoted
President Obama on Wednesday as saying he was "shocked and saddened"
by the fatal shooting attack. "This outrageous act reminds us that
we must remain vigilant against anti-Semitism and prejudice in all
its forms," Obama said at the White House.

HaQaretz and The Jerusalem Post reported that yesterday High Court
of Justice President Dorit Beinisch sharply criticized the state for
not having dismantled the unauthorized West Bank outposts of Harsha
and Hayovel. "We have heard about demolition orders for years," she
said, "and nothing has happened." Beinisch's comments came at a
hearing by the Court on a 2005 petition by Peace Now.

HaQaretz reported that Interior Minister Eli Yishai (Shas) has
instructed ministry employees to nix a master plan for Jerusalem on
the grounds that it allocates too much territory to Palestinian
construction.

Leading media reported that PA officials expressed deep satisfaction
with the talks they held yesterday with Special Envoy Mitchell,
saying that the new administration of President Obama was Qone of
the friendliest in decades.Q HaQaretz quoted senior Palestinian
negotiator Saeb Erekat as saying yesterday that the Palestinians are
in a position of strength vis-a-vis Israel for the first time in
their history. Speaking to the BBC, Erekat said American pressure
on Israel would probably succeed and move the peace process forward.
HaQaretz quoted sources close to Palestinian President Mahmoud
Abbas as saying that the Obama administration has shifted the
Mideast agenda, taking a tough position on settlements. Senior
Palestinian officials add that even American Jewish organizations
are unwilling to take a strong stance to defend Israel on the issue.
HaQaretz quoted Mitchell as saying after his meeting with President
Abbas that the United States hoped negotiations on a final peace
agreement between Israel and the Palestinians would begin
immediately, leading to an "early conclusion" of talks.

The Jerusalem Post reported that an Israeli defense source told the
newspaper yesterday: QIf you pay attention, there is a catch. The
U.S. is conditioning the opening of crossings on coordination
between Israel and the Palestinians.Q The source was responding to
U.S. pressure to reopen the crossings.

Makor Rishon-Hatzofe reported that senior Hamas member Salah
Albardawil told the paper that if his movementQs conditions are met
and a Palestinian state is established, it will recognize Israel.
HaQaretz reported that this week the Foreign Ministry sent Peace Now
Secretary-General Yariv Oppenheimer to a meeting with senior
Egyptian journalists. FM Avigdor Lieberman was not informed about
this.

Media quoted the Web site of HizbullahQs Al Manar-TV as saying that
yesterday at Beirut Airport Lebanese authorities arrested two
Israeli Arab sisters in their sixties.

The Jerusalem Post quoted Israeli and Georgian officials as saying
yesterday that Israel has QdiminishedQ its military sales to Georgia
follwing Russian pressure on Jerusalem.

Maariv cite an index put out by the consulting firm ECA
Intrnational ranking Tel Aviv as more expensive than ew York and
Washington for foreign visitors.

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1. Mideast:
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Block Quotes:
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I. "Reaching Out to Islam"

The independent, left-leaning Ha'aretz editorialized (6/11):
QNetanyahu, who is very well-acquainted with the way the American
administration works, knows this time around the evasive tricks
aren't going to help.... Netanyahu can embrace Obama's style and
alongside his policy extend a hand for reconciliation --
reconciliation with the Palestinians, reconciliation with the Arabs
in Israel who have absorbed QloyalQ blows from the partners in his
government, and reconciliation with the Muslim world, which is
anxiously watching Israel's attempt to take over the city that is
holy to three faiths. The Premier's rhetorical skills do not need
proving. This time they can serve him as a tool of statesmanship
that could bring about a new atmosphere and plant hope similar to
the hope instilled by Obama's speech.

II. "The Way to Build Lack of Trust"

Liberal columnist Uzi Benziman wrote in the popular, pluralist
Maariv (6/11): QWhether reports about the influence of [President
ObamaQs aides David] Axelrod and [Rahm] Emanuel are correct or
false, what is the diplomatic logic in sullying them as enemies of
Israel? WhatQs the object of labeling the President as someone who
bluntly intervenes in the Jewish stateQs affairs? In the upcoming
period, Netanyahu and his bureau will have to conduct correct
working relations with the White House staff and perhaps earn their
good will. It was proven his week that Netanyahu surrounds himself
with not particularly successful advisers.

III. "The Seven-Word Formula"

Columnist Ari Shavit wrote in Ha'aretz (6/11): QNetanyahu must make
a grand statement [in his policy speech] on Sunday. He must say
words of substance and truth.... On the one hand, the Prime Minister
must accept the two-state idea. There is no other way. On the other
hand, he must remove its inherent dangers. Netanyahu must summarize
this complexity in one brief phrase that everyone can understand and
that will clearly reinforce the Israeli peace concept. This is the
phrase: a two nation-state solution. In detail: a demilitarized
Palestine alongside a Jewish Israel. No more than seven words. But
seven words that encompass everything. Seven words that transfer the
onus from Israel to the Palestinians. Seven words that shift the
burden of proof from Benjamin Netanyahu to Barack Obama. Anyone who
accepts these seven words is saying that he intends to end the
Israeli-Palestinian conflict in a responsible manner. Anyone who
rejects them reveals he is hostile to Israel and is not really
committed to its security and existence.

IV. "Mashal Is Waiting for Netanyahu"

Former Mossad Director Ephraim Halevy wrote in the mass-circulation,
pluralist Yediot Aharonot (6/11): Q[Hamas leader Khaled Mashal] will
attentively listen to the Prime MinisterQs speech in order to
understand what Israel intends to do about Gaza over the next
months.... Make no mistake: Hamas wonQt adopt the three conditions
of Obama and Israel soon. Not now, but this will come. During his
European tour, Obama very justly said that Israel is one of the
strongest countries in the world. He also expects it to behave as
such -- sure of itself and its strength, without penetrating its
daily existence too deeply.... Mashal already said Qtwo states.Q He
is not interested in Netanyahu making similar comments. What
Netanyahu will say about the continuation of his policy in Gaza and
vis-a-vis Hamas will strongly influence what Mashal will understand
and do.





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2. Iran:
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Block Quotes:
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"Moussavi Is Bad for Israel"

Soli Shahvar, an Iranian affairs expert from Haifa University, wrote
in the mass-circulation, pluralist Yediot Aharonot (6/11): QMany
people will feel relieved if [Mor-] Hossein Moussavi is elected
president of Iran tomorrow. There can be no doubt that Israel is
interested to see a liberal, less hostile regime in Iran. But, in
view of the regimeQs structure and its determination to obtain
nuclear weapons, it is likely that AhmadinejadQs election --
resulting in the continuation of domestic popular embitterment and a
tough foreign policy stance -- would be better for Israel.

CUNNINGHAM