Israel is neither broken nor defeated, and has red lines that it simply will not cross even to free a kidnapped soldier, Prime Minister Ehud Olmert told the nation Tuesday evening, explaining why last-minute efforts to broker a deal for the release of St.-Sgt. Gilad Schalit had apparently run aground.

Prime Minister Ehud Olmert issues a statement at the PMO in Jerusalem on stalled talks to free Gilad Schalit.
Photo: Ariel Jerozolimski
"I wish to say, on behalf of the State of Israel and its government - we do have red lines," Olmert said in a brief statement after a three-hour cabinet meeting on recent developments in the effort to free Schalit. "We will not cross them."
"We are not a broken people," Olmert continued. "We are not a defeated nation. A people who desire life, one surrounded by hostile countries, threatened by murderous terrorist organizations - cannot, is not willing, nor will it agree to surrender to every dictate made."
Ofer Dekel, Olmert's emissary on the prisoner issue, who has been working on the Schalit matter for years, and Shin Bet (Israel Security Agency) head Yuval Diskin briefed the cabinet on their recent negotiations in Cairo and said that not only was Hamas unwilling to show any flexibility in its demands, but the organization had actually backtracked on conditions that had already been agreed upon.
According to government officials, Dekel and Diskin approved some 325 names out of a list of 450 that Hamas had demanded. When Israel refused to consider the others, Hamas refused to submit other names for consideration.
Israel would "not agree to release more prisoners from the Hamas list beyond the hundreds of names that we agreed to and announced to them," the prime minister said in his statement.
Olmert, whose time in office is nearing its end, said, "As long as I stand at its head, the government of Israel will not agree to any of the conditions or dictates of Hamas as they were presented to the negotiating team. Israel presented the other side with generous, far-reaching and unprecedented offers that were meant to lead to Gilad's release.
"I approved these offers, the practical meaning of which was the release of many hundreds of terrorists, including murderers of Israeli citizens, for the possibility of returning Gilad. These offers were rejected. Others will not be delivered to the Hamas."
It is widely assumed that Olmert's successor, Prime Minister-designate Binyamin Netanyahu, will be less generous than Olmert on the matter, although he has said nothing publicly on the issue.
In a shift of tactics, the Prime Minister's Office - following the cabinet meeting - published for the first time the names of some of the prisoners Israel was ready to release, as long as they would be expelled either abroad or to the Gaza Strip, as well as the names of 10 terrorists Israel was unwilling to let go.
Among those Israel refused to release were Abdullah Barghouti, given 67 life sentences for his role in a string of terror attacks, including at the Sbarro restaurant and Moment Café in Jerusalem, that killed 66 Israelis and wounded 500 others; Mohand Sarim, one of the planners of the Park Hotel bombing in Netanya, which killed 29 Israelis and wounded 64 others on Pessah 2002; and Ra'ad Hutari, convicted of recruiting a number of suicide bombers, including the one who perpetrated the 2001 attack at the Dolphinarium in Tel Aviv, which killed 22 people and wounded 83 others.
At the same time, Israel agreed to release hundreds of terrorists "with blood on their hands," including Nassar Nazal, a senior Hamas operative in Kalkilya who dispatched the suicide bomber who carried out an attack in October 2002 on the Bar-Ilan Bridge, killing one person and wounding 20.
A government source said the criteria for who would be released, even though they had "blood on their hands," and whom Israel refused to release even if they were deported, was based on determinations by security officials regarding who would be more likely to harm Israel in the future, even from abroad.
"The determination was based on who was a greater risk to come back and haunt us in the future," the source said.
According to government sources, in addition to the disagreement over which prisoners would be released, there was still disagreement with Hamas over Israel's demand that they not return to the West Bank, but either be deported or sent to the Gaza Strip.
A statement released by the Prime Minister's Office after the cabinet meeting said that according to the assessments heard in the meeting by the country's top security officials, "if Israel had released all of the murderers that Hamas was demanding, this would have caused severe damage to national security, including regarding the rehabilitation of strategic terrorist infrastructures and the return of senior 'terrorist engineers' who had planned and put into operation the most murderous terror attacks that Israel has ever known. This would have also dealt a mortal blow to pragmatic elements in the region, whereas the extremists would have been significantly strengthened."
In addition to Diskin and Dekel, the cabinet ministers also heard from Chief of General Staff Lt.-Gen Gabi Ashkenazi and OC Military Intelligence Maj.-Gen. Amos Yadlin.
While the government did not vote on any concrete proposal at the meeting, it did approve the establishment of a ministerial committee, headed by Justice Minister Daniel Friedmann, to propose additional sanctions that Israel could use to "soften" Hamas's demands.
Among the proposals that the committee is expected to discuss, and which are to be brought to Sunday's cabinet meeting, measures to make the conditions in Israeli jails for Hamas prisoners more difficult, including restricting visitation rights, phone and telephone access, and newspaper and television privileges, and perhaps depriving them of electricity at night. The rationale behind this would be to make the conditions facing the Hamas prisoners somehow similar to Schalit's.
"Hamas made demands that no Israeli government would have been able to accept," Friedmann told reporters following the cabinet meeting.