Reported from Jerusalem
1. UNITED STATES VETOES ARAFAT PROTECTION RESOLUTION… The United States used its veto in the United Nations Security Council on Tuesday to block passage of a resolution that would have forbidden Israel to act against Yassir Arafat. The U.N. action came after Israel’s security cabinet passed a resolution of its own that called Yassir Arafat an “obstacle” and reserved the right to take any action to remove that “obstacle.” The U.S. had considered abstaining rather than vetoing an earlier draft, but the final version considered by the Security Council was called “lopsided” by American officials, who objected to any resolution that failed to include a condemnation of the Palestinian violence that led to the Israeli action. The United Kingdom, Germany and Bulgaria abstained.
2. ARAFAT OFFERS CEASE-FIRE PLAN; ISRAELI SPOKESMAN DISMISSES IT… While on center stage as a result of Israel’s declaration against him, Yassir Arafat went on the offensive with an offer to broker a cease-fire if Israel ends its hunt for wanted terrorists and closures of Palestinian areas. Sharon spokesman Raanan Gissin dismissed the offer, saying that Israel “is not going to be lulled into this honey pot of a hudna or cease-fire.”
3. U.S. PENALIZES ISRAEL FOR CONSTRUCTION IN POST-1967 AREAS… The Bush Administration yesterday confirmed that it will penalize Israel for construction in the post-1967 areas by deducting the amount spent on such construction from the $9 billion loan guarantee package that went into effect on Tuesday. It also said that the first reduction will take place only in a later phase of the three-phase payout. The amount to be deducted has not yet been established. Prime Minister Sharon is trying with little success to deny that his postponement of a cabinet session on Wednesday that was supposed to authorize the building of the next phase of the security fence was due to American pressure. Administration sources said that no decision had been reached over whether to also penalize Israel for the cost of building the security fence.
4. BUDGET PASSES, SETS OFF HEALTHCARE CRISIS… Israeli health officials are warning that the austerity budget passed by the cabinet yesterday will cause unprecedented havoc in health issues and even cause deaths. One prime area of concern is the make-up of the “basket” of drugs and treatments included for government subsidy. A section of the ministry that is charged with the ongoing process of evaluating new drugs and treatments for inclusion in the basket has been told to reverse the process and remove existing ones, while not adding new ones. Health specialists insist that the result will be to deny citizens vital medications and treatments that in many cases may result in death. The massive Histadrut labor federation is planning a series of nationwide job actions to illustrate their anger with Finance Minister Binyamin Netanyahu’s budget plan. A general strike is a strong possibility. University students will delay the start of classes and are threatening a wider strike after tuition was raised 10-15%. The Treasury had already reversed a previous policy aimed at cutting tuition in half over several years, but had agreed to forego a tuition hike as part of an agreement reached with the Shinui Party. When all five Shinui ministers voted against the budget, Netanyahu declared his agreement with them null and void and invoked the sharp increase in tuition.
5. FOREIGN INVESTMENT IN ISRAEL DOUBLES IN FIRST HALF, BUT ISRAELIS NOT INVESTING ABROAD… Israel’s Central Bureau of Statistics reported that foreign investment in Israel doubled in the first half of 2003 to $2 billion, according to Globes financial newspaper. Israelis, on the other hand, have stopped investing overseas. Overseas investment went from $3.3 billion in the first half of 2002; to $400 million the second half; to a “negligible” $100 million in the first half of 2003.