• Syrian Rebels Increasing Effectiveness in Conflict - Rod Norland and Hwaida Saad
  Syrian insurgents struck at high-profile targets in the capital region on Thursday for the third time this week, demonstrating their increasing effectiveness and reach. The latest was a double bombing - one detonated in the parking garage of the Palace of Justice in downtown Damascus, and the other at a city police station. The day before, an attack destroyed a pro-government television station, and Monday the Free Syrian Army struck the barracks of the Republican Guard, next to Assad's palace. (New York Times)
      See also Kofi Annan Proposes Syria "Unity Government"
  Kofi Annan, the joint UN-Arab League envoy to Syria, has proposed setting up a transitional government that could include followers of President Assad and opposition members in a bid to end the country's war, diplomats said. The major powers generally back the plan, which will be discussed at a meeting of foreign ministers Annan has convened in Geneva on Saturday. (Al Jazeera)
      See also Saving Syria from Kofi Annan - Claudia Rosett (PJ Media)
• Tantawi to Remain Egypt's Defense Minister - Marwa Awad
  Egyptian Field Marshal Hussein Tantawi, 76, who served as defense minister for two decades under Hosni Mubarak, will keep his post after Egypt's first Islamist president takes over, Maj.-Gen. Mohamed Assar, a member of the military council, said Wednesday. The Supreme Council of the Armed Forces has named a new National Defense Council to run defense and foreign policies. Although Muslim Brotherhood President-elect Mohamed Mursi and his future prime minister will serve on the council, they will be outnumbered by the generals in a body whose decisions will be taken by majority vote. (Reuters)
• Jordan's King Meets Previously Shunned Hamas Leader in Effort to Engage Islamists
  A Jordanian Royal Palace statement says King Abdullah II's talks Thursday with seven Hamas officials, headed by leader Khaled Mashaal, focused on a two-state solution to the Palestinian-Israeli conflict, referring to creating a Palestinian state next to Israel, which Hamas ideology rejects. Abdullah's meeting with Mashaal, a Jordanian citizen, is their second since January. Mashaal was expelled in 1999 for "illicit and harmful" activities. (AP-Washington Post)
• Iran's Top Asian Oil Buyers Cut Imports 18 Percent - Aaron Sheldrick and Osamu Tsukimori
  Asia's top buyers of Iranian oil cut imports by more than a quarter of a million barrels per day in the first five months of the year as they prepared for U.S. sanctions that take effect on Thursday and EU curbs that bite from Sunday. Tehran acknowledged for the first time on Wednesday that its oil exports were down as much as 30% from normal volumes of 2.2 million barrels daily. Imports by Japan, China, India and South Korea from Iran fell 25% in May alone to 999,230 bpd from 1,338,193 bpd a year earlier. (Reuters)

• IDF Preparing for Possible Terror Attacks from Syria - Amos Harel
  The IDF is preparing for the possibility of terror attacks from the Syrian border, Brig.-Gen. Tamir Hyman said Thursday. "The events unfolding beyond the border increase the likelihood of terror attacks. That, in turn, necessitates preparations as far as infrastructure, training and deployment." Extremist Islamic terror groups are flooding to Syria from Iraq and other countries. Toppling the Assad regime is their main objective, but they might use the opportunity to launch attacks against Israeli citizens in the Golan Heights. (Ha'aretz)
      See also Syria Is the New Sinai - Yaakov Katz (Jerusalem Post)
• IDF to Deploy Observation Balloons along Egyptian Border - Ilan Ben Zion
  Because of their success on the Gaza border, the IDF has now decided to station observer balloons on the increasingly problematic Egyptian frontier, Israel Channel 10 TV reported Wednesday. The balloons, equipped with electronic surveillance technology, give IDF intelligence 360 degrees of high-definition visibility for up to eight km. (five miles). They also gather meteorological data.
      "In the last week, our [balloon] networks cooperated to no small degree with IDF artillery and the air force to destroy no small number of launchers and terrorist cells," said Captain Shahar Golbary, commander of the Gaza Division's balloon unit. "When the terrain is flat the balloon can alert us long before the forces arrive at a specific point." Earlier this week, an Israeli military official said that terrorist cells in Gaza now have mere moments before they are spotted and targeted by Israeli missiles, thanks to a streamlined intelligence network and more readily available firepower. (Times of Israel)
      See also Israel Air Force Shortens Response Time When Sighting Gaza Rocket Cells - Mitch Ginsburg
  Rocket-launching terror squads in Gaza used to have several minutes to set up their weapons, shoot them and disappear before Israel could muster any counter action. Today, an Israeli military official says, the cells have mere moments before they are spotted and targeted. "If in the past it would take a considerable amount of time from sighting (a terror squad) until being able to fire on them, meaning that you would lose (sight of) the squad, today that hardly ever happens," said an Israel Air Force official. In the most recent round of confrontation, six squads were successfully targeted while trying to fire on Israel. (Times of Israel)
• Lebanese Protest Hizbullah's Arms - Mohammed Zaatari
  Sheikh Ahmad Assir warned that the sit-in he and his supporters are holding on the highway in Sidon will continue until a solution to the issue of Hizbullah's arms is devised. "We will not return to our homes until a peaceful solution is found," he said. Around 150 protesters set up a tent and blocked the highway connecting Sidon to south Lebanon Thursday in continuation of a protest against non-state arms that began Wednesday. Hundreds of protesters blocked the northern and southern entrances to Sidon Wednesday evening by lying on the road. Assir told reporters, "All Lebanese fear war and strife but we can no longer live without dignity; the resistance party's [Hizbullah's] arms stole our dignity."  (Daily Star-Lebanon)

Egypt


• Morsi's Victory in Egypt: Early Implications - Robert Satloff
  It would be a grave error to fixate on the obstacles the Egyptian army has put in the way of the Islamists without appreciating the latter's remarkable ability to fill any political vacuum they are permitted to fill - first, by stepping into Tahrir Square to inherit a revolution waged by secularists; second, by trouncing all comers in winning three-quarters of the seats in parliamentary elections; and third, by taking the presidency.
      Betting against them now, merely because the Supreme Council of the Armed Forces (SCAF) has neatly executed a rearguard holding action, is probably unwise. The obstacles SCAF has thrown in the path of Islamist monopolization of power may not be tools to derail the Brotherhood's ambitions, but instead gambits to negotiate the best deal possible and retain military prerogatives in an Islamist-controlled state. The writer is executive director of the Washington Institute. (Washington Institute for Near East Policy)
• What to Expect from Egypt's Morsi - Aymenn Jawad Al-Tamimi
  The most likely outcome in Egypt is that the military will entrust to itself management of foreign policy, while granting the Muslim Brotherhood's Mohamed Morsi considerable autonomy in domestic affairs, even as the military has assumed control over the drafting of the constitution. With the military managing foreign policy, the chances of a full-blown war between Egypt and Israel are slim, despite bellicose rhetoric emanating from some quarters of the Muslim Brotherhood calling for the liberation of Jerusalem and establishment of a "United Arab States."
      Egypt's population (83 million as of October 2011) could reach 100 million by 2020, with more than 99% living in an area near the Nile River only 2.5 times the size of Israel. Even assuming Egypt can escape from its current economic crisis, there is no sign its economy can keep up with the pace of population growth. The writer is an adjunct fellow at the Middle East Forum. (Ha'aretz)
• Egyptians Shift Views of U.S. - Matt Bradley
  Some jilted supporters of former regime stalwart Ahmed Shafiq, who lost to Mohamed Morsi in the election, are peddling the accusation that U.S. officials backed the Muslim Brotherhood's candidate, an assertion denied by the U.S. government, which insists it supported only a fair and transparent election process. The Brotherhood, meanwhile, has publicly warmed up to the superpower that for decades looked on it with deep concern.
      During the past 16 months, the Brotherhood has sent dozens of goodwill delegations to meet with officials in Washington to assure policy-makers of their commitment to democracy, economic liberalism and civil rights. State Department officials and some prominent American lawmakers have held meetings with senior Brotherhood leaders in Cairo. The Brotherhood trumpeted the meetings with U.S. officials in media reports. (Wall Street Journal)
• Practical Concerns, Not Ideology, May Keep Egypt-Israel Peace - Elizabeth Arrott
  Political sociologist Said Sadek of the American University in Cairo noted, "The majority of the [Egyptian] people want to keep peace with Israel and want to concentrate on fighting poverty, ignorance, religious extremism, corruption. These are the real issues. Not neighbors." Sadek adds that after being on the losing side of past conflicts with Israel, few in Egypt are interested in fighting neighbors again. (VOA News)


Syria


• How Long Can the Free Syrian Army Hold Off Its Islamist Rivals? - Tyler Golson
  Walid al-Boustani led an ill-fated "Islamic Emirate of Homs" that lasted only a few weeks. Apparently the locals did not appreciate having an "emir" who kidnapped and murdered their people while claiming to wage jihad against the regime of Bashar al-Assad. And so in March 2012 a local brigade of the Free Syrian Army executed the Lebanese-born al-Boustani.
      The incident is part of a larger clash - the struggle between Syria's two main armed opposition groups. It's important to know that the rebel groups with an Islamist political agenda - that the U.S. and its allies have decided not to support - are distrusted by the Syrian people themselves.
      Compounding Syrians' ideological unease with jihadists is the widespread concern that Islamist groups have either been infiltrated by, or are directly working for, the Syrian regime. Boustani's "trial" and execution by the FSA stirred considerable speculation among Arab audiences, who focused on his ties to a discredited al-Qaeda-linked terrorist group back in Lebanon, Fatah al-Islam, which is widely believed to be a tool of Syrian intelligence.
      Any jihadist group emerging in Syria today - especially one whose operations and rhetoric so neatly validate the regime's narrative of a terrorist conspiracy - is immediately suspected of being a government creation. (New Republic)


Iran


• How Iran Killed Its Future - Shahrzad Elghanayan
  In May 1979, three months after Ayatollah Khomeini's return to Iran, my grandfather, Habib Elghanian, Iran's most prominent Jewish industrialist and philanthropist, was gunned down by a revolutionary firing squad. His execution and the subsequent fleeing of businessmen from Iran contributed to derailing the country's chances of building a modern, diversified economy.
      During a show trial that lasted no longer than 20 minutes, he was falsely charged with being a "Zionist spy" and a "corrupter on Earth." His crime, according to the prosecutor, was making financial contributions to Israel and meeting with Israeli politicians when they came to Iran or when he traveled to Israel - as was customary in the 1960s and 1970s when Iran and Israel enjoyed peaceful relations under the shah.
      Known as "Iran's plastics king," my father, along with his brothers, spent decades building factories, creating thousands of jobs. The family played a pioneering role in Iran's modernization and industrialization, building the first high-rise and shopping arcades. (Los Angeles Times)


Other Issues


• Book Review: Should Israel Exist? - Amir Taheri
  Imagine if someone suggested you should read a book that discusses whether or not Norway, or the U.S., should exist. In the case of Israel, however, posing that question does not seem to be out-of-bounds. Michael Curtis, a distinguished scholar and professor emeritus at Rutgers University, has devoted a whole book to examining the subject and refuting the claims of those who question Israel's right to exist. The result is a masterly essay in the service of a moral case in support of Israel.
      Politically, Israel is the fruit of a liberation struggle against an imperial power in the wake of World War II - in this case, Great Britain. Legally, it is a creature of the UN, which, as successor to the British Mandate on Palestine, endorsed the creation of the Jewish state.
      But Israel is different. To start with, it is Jewish. That makes it the target of anti-Semitic sentiments and resentments that have deep roots in many Western and some Islamic societies. Then there is the fact that Israel has been a democratic island in a neighborhood of authoritarian and totalitarian regimes. (Gatestone Institute)
• Still No Peace Partner - Zalman Shoval
  David Ben-Gurion realized that our adversaries' concept of peace differed from what he later called "true peace," meaning recognition not only of Israel's de-facto physical and legal existence, but of its moral right to exist. Most of the initiatives to resolve the Israeli-Palestinian conflict have failed because of the refusal of the Palestinians and most parts of the Arab world to recognize the Jewish people's right to a national state in a region that they consider to be an exclusive Arab and Muslim domain. Often their refusal is coupled with the hope that the ultimate fate of the Jewish state will be like that of the Crusader kingdom - it will eventually disappear.
      The unfortunate but inescapable conclusion is that as long as the Arabs, and principally the Palestinians, do not accept, psychologically and politically, the reality and the legitimacy of the existence of Israel as the Jewish nation state, they will not be true partners for peace.
      There are those who remind us of the so-called Saudi peace initiative of 2002 - conveniently forgetting that at the later Arab League summit in Beirut, the "initiative" became a take-it-or-leave-it ultimatum, including in such matters as the return of Palestinian refugees to Israel and Syria's demand that Israel withdraw from the eastern shore of the Sea of Galilee. The writer is a former Israeli ambassador to the U.S. (Jerusalem Post)
      See also The Arab Peace Initiative: A Primer and Future Prospects - Joshua Teitelbaum (Jerusalem Center for Public Affairs)
• Incitement or Peace Education? - Yael Teff-Seker and Nir Boms
  A new report published by the office of PA Prime Minister Salam Fayyad claims that "Israeli textbooks foster hate" and that "Israeli schools teach [from] racist textbooks." For instance, the report objects to the use of the name "Judea and Samaria," and the reluctance of Israeli textbooks to present Jerusalem as Palestinian territory. But these do not constitute incitement, nor are they even considered wrong or biased by international standards.
      First, Jerusalem is under Israeli control and therefore an accurate geography book could not depict matters otherwise. Second, the technical (Hebrew) geographic name for the above-mentioned area is, actually, Judea and Samaria, and therefore its use does not demonstrate political prejudice.
      By contrast, Israel remains absent in the vast majority of Palestinian textbooks maps. Yael Teff-Seker is a researcher and Nir Boms is a member of the board of the Institute for Monitoring Peace and Cultural Tolerance in School Education. (Jerusalem Post)

To End Iran's Nuclear Program, It's Time for America to Step Up Its Economic Warfare - Mark Dubowitz (Foreign Policy)

• Iran suffers from hyperinflation, stagnant growth, and a crumbling currency, Yet sanctions have so far failed to force Iranian Supreme Leader Ali Khamenei to halt the nuclear weapons program. The painful truth is that Western sanctions have been underwhelming. Three rounds of failed talks in Istanbul, Baghdad, and Moscow have shown that the U.S. and its allies do not yet have the kind of leverage that could make Khamenei yield. He has reason to believe that Iranian physicists can construct a nuclear bomb faster than Western countries can undermine his economy.
• Sanctions have had a devastating effect on Iran's economy. The National Iranian Oil Co. has been forced to provide Chinese traders discounts of $20 per barrel or give them extended payment terms. Some 67 million barrels of Iranian crude are currently sitting in storage. But with $60-105 billion in foreign currency reserves, Khamenei's economic expiration date may still be far off.
• For the past seven years, the U.S. Treasury Department has sanctioned hundreds of financial and commercial entities controlled by the IRGC, but Iran can spin off new front companies faster than Treasury officials can target them, conjuring up "clean" entities with which international companies can maintain their business relationships. Blacklisting Iran's entire energy sector would solve that problem.
• Central Bank sanctions should also be extended beyond formal financial institutions, targeting foreign exchange houses in the Persian Gulf that assist Iran in accessing hard currency, gold suppliers that allow countries like China to pay for Iranian oil in gold, companies that provide services to the Central Bank of Iran for the printing of Iranian currency, and alternative payment and settlement mechanisms, like the Swiss-based Iranian company Naftiran Intertrade Co., which Iran is using to funnel funds to its Central Bank.
• Economic warfare should not be limited to the energy sector. The U.S. and its allies should also target other areas of the Iranian economy. Aggressive action against sectors controlled by the IRGC in construction, engineering, telecommunications, and technology should be a no-brainer.
  
  The writer is executive director of the Foundation for Defense of Democracies and head of its Iran Energy Project.