March 4, 2010 Scandal in Israeli Banks, Peace Talks?

The Israeli news has led with a different scandal in the last two days. This new scandal is not one involving a politician, but involving a man who was, until recently, one of the leaders of the Israeli business community, Yossi Danker. Danker's resignation was forced by Bank of Israel Governor General, Stanley Fisher, in his role as regulator of the banks. Danker is being accused of massive "self dealings", in which he gave entities he controlled low cost loans, at the same the time he enriched himself and his families by millions of dollars.

In a different arena, there is a sense something might be happening on the diplomatic front. On one hand, the Palestinians have agreed to indirect talks. There is some new discussion of a coalition government with Kadima, if advances are made in negotiations. It's hard to see how Netanyahu can keep his coalition together if any real advances are made. With the chances of getting a new round of sanctions on Iran getting slimmer (at least through the UN route) since both China and Brazil are calling for more useless negotiations, then coming to a deal with the Palestinians may be ever more urgent. I do not believe in direct linkage. However, getting international support for military action, if necessary, will be made much easier if Israel is engaged in serious negotiations with the Palestinians that are bearing fruit. I repeat what I have stated before: Yitzhak Rabin agreed to Oslo, (which he was trying to move forward further before he was murdered), because he foresaw the Iranian threat and believed only by reaching a peace agreement with the Palestinians could that threat be defused.

Things do not seem to be all quiet within Hamas in Gaza. The rift between Hamas Gaza and the Hamas political leadership in Damascus has become more serious in recent weeks. Damascus seems to be getting ever more radical and continues to align with the Iranians; while the somewhat more pragmatic leadership on the ground in Gaza has not been happy with that development. Meanwhile, Hamas in Gaza is being challenged by the even more radical elements within the population of Gaza.