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### Viewing cable 10BERLIN8, MEDIA REACTION: U.S., AFGHANISTAN, IRAN, MIDEAST, ICELAND,

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Reference ID | Created | Released | Classification | Origin
--- | --- | --- | --- | ---
10BERLIN8 | 2010-01-06 13:01 | 2011-01-13 05:05 | UNCLASSIFIED | Embassy Berlin

`

    VZCZCXRO1676
    RR RUEHAG RUEHDF RUEHLZ
    DE RUEHRL #0008/01 0061325
    ZNR UUUUU ZZH
    R 061325Z JAN 10
    FM AMEMBASSY BERLIN
    TO RUEHC/SECSTATE WASHDC 6189
    INFO RHEHAAA/WHITE HOUSE WASHINGTON DC
    RUEKJCS/SECDEF WASHINGTON DC
    RHEFDIA/DIA WASHINGTON DC
    RUEAIIA/CIA WASHINGTON DC
    RUEATRS/DEPT OF TREASURY WASHINGTON DC
    RUCNFRG/FRG COLLECTIVE
    RUEHBS/AMEMBASSY BRUSSELS 1893
    RUEHLO/AMEMBASSY LONDON 0615
    RUEHFR/AMEMBASSY PARIS 1132
    RUEHRO/AMEMBASSY ROME 2637
    RUEHNO/USMISSION USNATO 1658
    RUEHVEN/USMISSION USOSCE 0821
    RHMFIUU/HQ USAFE RAMSTEIN AB GE
    RHMFISS/HQ USEUCOM VAIHINGEN GE//J5 DIRECTORATE (MC)//
    RHMFISS/CDRUSAREUR HEIDELBERG GE
    RUKAAKC/UDITDUSAREUR HEIDELBERG GE

` `

    UNCLAS SECTION 01 OF 05 BERLIN 000008

    STATE FOR INR/R/MR, EUR/PAPD, EUR/PPA, EUR/CE, INR/EUC, INR/P,
    SECDEF FOR USDP/ISA/DSAA, DIA FOR DC-4A

    VIENNA FOR CSBM, CSCE, PAA

    "PERISHABLE INFORMATION -- DO NOT SERVICE"

    SIPDIS

    E.0. 12958: N/A
    TAGS: AF IF XF IC EFIN
    SUBJECT: MEDIA REACTION: U.S., AFGHANISTAN, IRAN, MIDEAST, ICELAND,

    DEFENSE, ECONOMIC;BERLIN

    ¶1.   Lead Stories Summary
    ¶2.   (U.S.)   Obama - Intelligence Services' Meeting
    ¶3.   (Afghanistan)   London Conference
    ¶4.   (Iran)   Ban to Talk to Foreign Institutions
    ¶5.   (Mideast)   New Peace Efforts
    ¶6.   (Iceland)   Government Won't Repay Debts
    ¶7.   (Defense)   A 400 M
    ¶8.   (Economic)   State of U.S. Economy

    ¶1.   Lead Stories Summary

    The main story in today's print media is the conflict between
    Foreign
    Minister Westerwelle and the head of the Expellee Organization,
    Erika
    Steinbach, on her future job as board member of the Foundation
    "Flight, Expulsion, Reconciliation."  Other stories deal with
    Iceland's refusal to repay debts to the UK and the Netherlands
    (Handelsblatt, FT Deutschland) and the most recent unemployment
    figures (Berliner Zeitung).  Editorials focused on the Steinbach-
    Westerwelle conflict and on the renewable energies project in the
    North Sea.  ZDF-TV's early evening newscast heute and ARD-TV's early

    evening newscast Tagesschau opened with reports on Steinbach.

    ¶2.   (U.S.)   Obama - Intelligence Services' Meeting

    Under the headline "Obama acts as counterterrorism President,"
    Spiegel
    Online led with a story noting: "He wanted to move away from the
    warlike politics of his predecessor George W. Bush, but the failed
    Detroit attack makes clear:  the fight against terrorism is also the

    main business for Barack Obama.  His speech after the intelligence
    meeting shows how much the new role will change his style of
    government."

    Berliner Zeitung (1/6) noted: "One result was clear already prior to

    the security meeting: The dark shadow of terror fears has settled
    down
    around Obama's presidency.  Before the Detroit plot, the topic
    hardly
    played a role eight years after 9/11...  Experts now believe that it

    will play a greater role on Obama's agenda this year."

    FT Deutschland (1/6) carried a page on America's airport security
    policy, highlighting:  "America closes down - In fear of new terror

    attacks, the U.S. tightens its entry regulations.  However, many of

    the protectionist measures are ineffective and put off tourists and

    businessmen.  Israel shows how to create high security standards
    with
    little use of technology."

    Berliner Zeitung (1/6) headlined "Double agent humiliates the CIA,"

    and notes in its intro: "Many things that happened last week at the

    CIA outpost Forward Operating Base Chapman in the Afghan border
    region
    are still unclear....  However, it seems to be clear what led to the

    BERLIN 00000008  002 OF 005

    serious setback: the suicide bomber was obviously a double agent
    with
    connections to al Qaida....  The terror network humiliated the CIA
    with
    a cat-and-mouse game."

    ¶3.   (Afghanistan)   London Conference

    Frankfurter Allgemeine (1/6) editorialized on Foreign Minister
    Westerwelle's statement that he seeks a "political" solution to the

    conflict in Afghanistan:  "He believes that this will allow him to
    avoid the discussion over an increase of German troops in
    Afghanistan.
    The reality looks different.  Westerwelle and the Americans share
    the
    same goal, but they differ on the path to get there.  2,500 American

    soldiers are supposed to be deployed to Kunduz, which is in the
    north
    of the country, where the Germans bear the responsibility.  Some of

    them are supposed to train 4,000 Afghan soldiers; other units will
    protect the camp and secure the region....  This makes clear what a

    challenge it is to set up Afghan security forces.  It will not be
    possible without additional foreign assistance, including a military

    component."

    ¶4.   (Iran)   Ban to Talk to Foreign Institutions

    Under the headline "Iran also focuses on German foundations," Die
    Welt
    (1/6) reported that "the regime imposed a ban on contacting 60
    institutions in the country and abroad....  The prohibition to talk
    to
    international broadcasters further limits the freedom to move for
    opposition leader Musawi and Medhi Karubi."  Frankfurter Allgemeine

    (1/6) headlined "Regime in Iran Broadens its Censorship," adding
    "Given the ongoing protests against the regime, the Iranian
    intelligence service tries to isolate 60 domestic and international

    institutions."

    ¶5.   (Mideast)   New Peace Efforts

    Frankfurter Allgemeine (1/6) commented: "The kind of two-state
    solution that would be acceptable to Israelis and Palestinians is
    not
    a secret.  It is more difficult to get both conflicting parities to

    reach these compromises despite the great political risks.  The
    current path of building confidence has not worked.  President Obama

    and his Mideast envoy Mitchell obviously want to try it the other
    way
    around: they lure both sides into new negotiations by promising that

    they will be finished after two years....  Given the many failed
    efforts, the new attempt is worthwhile.  However, the Israelis and
    Palestinians - and their leaders - must be willing themselves to
    create peace."

    ¶6.   (Iceland)   Government Won't Repay Debts

    Several papers (1/6) reported that the Iceland's President Grimsson

    BERLIN 00000008  003 OF 005

    announced that he would veto the repayment of 3.5 billion euro to
    foreign depositors and that he refused to sign a bill from which
    primarily British and Dutch savers would have profited.  Frankfurter

    Allgemeine reported under the headline: "Iceland Blocks
    Compensations," while Die Welt headlined: "Iceland's President Uses

    His Right to Veto Compensation of Savors" and reported: "It was the

    second time in the 65-year history of the country that a president
    whose job is primarily to represent the country, used his right to
    refuse to approve a bill.  According to the Constitution, a
    referendum
    must decide in such a case.  Grimsson's step is likely to intensify

    domestic turbulence in the island state, which has been especially
    hard hit by the financial crisis....  The unresolved compensation
    question is an obstacle to Icelandic efforts to join the EU and to
    get
    support from the IMF."   Tagesspiegel headlined: "Presidential Veto

    Plunges Iceland Into Crisis," while Financial Times Deutschland led

    with the lead story: "Iceland Risking Accession to the EU."
    Handelsblatt carried a lead story under the headline: "Iceland
    Risking
    Conflict with IMF."

    Berliner Zeitung (1/6) analyzed the situation in the country and
    wrote: "The nation held its breath, for what usually happens was
    declared a vital question this time.  More than 60,000 Icelanders -

    one quarter of al voters - called upon their president in a petition

    to stop the so-called compensation bill.  He did it yesterday and
    suggested a referendum on it.  This bill is more than a technical
    formality.  It is the key document for the self understanding of the

    Icelanders after the collapse of their economy but also for their
    country's rapprochement with Europe.  However, a referendum could
    jeopardize Iceland's quick accession to the EU because it cannot
    bypass London and The Hague on its way to Brussels.  And both
    governments clearly signaled yesterday that, without compensation
    for
    foreign depositors, there will be no accession and no further [EU]
    loans."

    In a front-page editorial, Handelsblatt (1/6) argued under the
    headline: "Fear of State Bankruptcy," that "Iceland's refusal
    clearly
    shows that, in 2010, we will have to fight fears that countries do
    not
    or are incapable of repaying their debt.  Cases such as Dubai,
    Greece,
    Latvia, and Ukraine are nurturing this fear.  But Iceland is a
    special
    case and has good chances to recover....  The country does not have
    to
    repay external debt by the end of 2011 and will have good chances
    with
    a high per capita income to be in a better situation soon if it
    wants
    to get fresh money from investors.  Despite the economic misery it
    is
    at least possible to play a poker game, as the president and the
    Icelanders are doing.  Other states such as Greece do not have such

    possibilities - and we will hear quite a lot from these countries in

    BERLIN 00000008  004 OF 005

    2010."

    According to Financial Times Deutschland (1/6), "The Icelandic
    government signed a contract in which it gave assurances to pay
    compensation.  Serious contractors stick to such promises when the
    contract has not even entered into force.  By withholding his
    signature, the Icelandic president is now also questioning Iceland's

    membership of the circle of industrialized countries that need to be

    taken seriously, let alone its declared goal of joining the EU.
    Obviously, neither the protesting people nor the President are aware

    of what is at risk.  In addition to the country's political
    respectability, Iceland's economic prosperity is at risk.  Who wants

    to invest in the country on whose promises we cannot rely?  And who

    will save Iceland and its currency during the next crisis if the
    Europeans - and this is understandable - have had enough?"

    ¶7.   (Defense)   A 400 M

    Frankfurter Allgemeine (1/6) carried a report under the headline:
    "Airbus Threatens To Scrap Military Transportation Aircraft," and
    wrote: "The tone in the controversy over the financing of the A 400
    M
    military transportation aircraft is getting sharper.  Airbus is now

    openly threatening to scrap the program if the governments do no
    make
    concessions in the talks with the company.  Financial Times
    Deutschland reported that EADS CEO Thomas Enders only sees a 50:50
    chance for a successful agreement.  This threat is primarily direct

    against the German government, which is taking the toughest position

    in the talks.  The parliamentary Undersecretary of Defense,
    Christian
    Schmidt (CSU) explained the German position towards FAZ: 'Cancelling

    the contract is not the subject matter of talks.'  The negotiating
    partner would be EADS, not Airbus, he said, and added: 'For us, the

    contract is the basis.  Additional demands from EADS are on the
    table
    and that is the subject matter of talks.'"

    According to Die Welt (1/6), "the Europeans are threatened with a
    disgrace.  When Airbus is threatening to scrap the A 400 M military

    transportation aircraft, then this is in reality the last attempt to

    save the project.  Saber rattling is a well tested tactical game in

    difficult negotiations...and a continuation of the project is very
    likely.   First, the end of the project would also be expensive for

    EADS.  In addition, EADS's reputation as a reliable supplier would
    be
    at risk....  And the nations that have ordered the plane will not be

    able to avoid additional payments either.  They must also be blamed

    for an increase in costs.  Germany, France, and the other countries

    wanted to demonstrate together with EADS that Europe is able to
    finance enormous arms projects such as the A 400 M.  It would be a
    disgrace for the producer and for the ordering nations to display

    BERLIN 00000008  005 OF 005

    the
    three prototypes of the aircraft, whose development already cost
    billions of euros, in a museum."

    ¶8.   (Economic)   State of U.S. Economy

    Under the headline: "U.S. Recovery Lacks Strength," Handelsblatt
    (1/6)
    editorialized: "The U.S. economy is turning around, profits and
    orders
    increase and the stock markets are cheering, but the biggest economy

    has been put on drugs and these drugs are losing their effect.  The

    arguments of the optimists, according to which the U.S. economy has

    embarked upon a path of growth, are only true for the short term.
    The
    current upswing is based on the fact that companies have increased
    their production after previous historic cuts and are rebuilding
    inventories.   On paper, this creates a strong increase in
    production,
    even though the turnover of many companies has hardly recovered from

    their plunge.  Experience teaches us that such recoveries, which are

    only based on a change with respect to inventories, do not last very

    long.  In addition, the optimists hardly say that the upswing rests

    almost exclusively on state doping. This effect is, on a short term

    basis, stimulating, but in the long run, dangerous.  For a long-term

    recovery, the U.S. economy, which is driven by domestic consumption,

    needs signs of relaxation from the highly indebted consumers and
    profound optimism on the part of the companies to initiate a new
    wave
    of investments.  The optimists can wish for such a development, but

    they cannot make it happen."

    DELAWIE

`