Mideast Report

JERUSALEM (JTA) -- President Bush again delayed moving the U.S. Embassy in Israel to Jerusalem.

In a statement last Friday, Bush said it was in the "national security interests of the United States" to postpone moving the embassy from Tel Aviv for an additional six months.

Since Congress passed the Embassy Relocation Act in 1995, presidents repeatedly have postponed the move.

"My administration remains committed to beginning the process of moving our embassy to Jerusalem," Bush said.

As a presidential candidate, Bush had told Jewish leaders that moving the embassy would be one of his first actions.

Ben-Eliezer quits Labor leader contest

JERUSALEM (JTA) -- Benjamin Ben-Eliezer dropped out of the race for interim leader of Israel's Labor Party.

The move by the former Israeli defense minister, who also is a former Labor Party chairman, paves the way for former Israeli Prime Minister Shimon Peres to be elected to the post in Thursday's race.

The interim chairman is expected to be barred from seeking the permanent chairmanship in primaries set for next June.

New Saddam Hussein born in Israeli-Arab village

JERUSALEM (JPS) -- The Interior Ministry has reversed its refusal to permit an Israeli-Arab couple to name their baby after fallen Iraqi leader Saddam Hussein, media reports said Wednesday.

Anwar and Muna Zabarka of Ara village in northern Israel were told earlier this month that they may not name their child for Saddam. Officials cited a law that bars names that are offensive to the public.

The Zabarkas appealed the decision to Interior Minister Avraham Poraz of the liberal Shinui Party, who reversed it and is allowing the name to be registered, apparently in defense of freedom of expression, Israel Radio said.

Zabarka has been quoted as saying he chose the name because he admires Saddam, though not his actions. "He is a witness to the pain of the Palestinian people," the baby's father said.

Netanyahu hopes to privatize government-owned banks

JERUSALEM (JPS) -- Visiting New York in the wake of El Al's flotation and the raising of $750 million in bonds, Finance Minister Benjamin Netanyahu expressed optimism regarding Israel's economy and promised more privatization.

"The Israeli government will complete the sale of the two banks remaining in its hands, Leumi and Israel Discount Bank, within the next 12 months," the daily Yediot Ahronot quoted the finance minister following his meeting with the heads of investment bank Lehman Brothers at the end of last week.

"Two months ago, there were no candidates to buy the banks and now there are six candidates for each one," Ha'aretz newspaper quoted Netanyahu as saying. "Just a year ago, we were told there was no chance to privatize national airline El Al, and we have proven that it can be done if there is a will."

Parents exhume son's body in IDF suicide conflict

JERUSALEM (JPS) -- The parents of an Israel Defense Force soldier who died two years ago are holding the coffin with their son's body in their home and demanding that an independent organization investigate the circumstances of his death.

The parents, Herman and Daniella Hiller, refuse to accept the army's explanation that their son, Pvt. Daniel Hiller, committed suicide on a nine-mile training hike. They insist he was killed by a bullet discharged by the gun of an officer with whom he got into an argument.

Last Friday night the father, with the help of friends, removed the coffin from the military cemetery and took it home.