Hi-Tech Defense: The latest breaking story from Israel today is the destruction of a Hamas terror tunnel from Khan Yunis in southern Gaza, into Israel. Prime Minister Benjamin Netanyahu and Defense Minister Avigdor Liberman touted the IDF’s new technological know-how. “I told you many times that we are developing groundbreaking technology to deal with the tunnel threat,” Netanyahu said. “We are implementing it. Today we detected a tunnel and destroyed it, and we will continue doing so.” Liberman said “Israel will not tolerate a breach of its sovereignty.” The Defense Minister added that Israel holds Hamas responsible, but is not looking to escalate the situation.

Trump Administration’s Diplomatic “Blitz”: The diplomatic scene appears to be heating up, and a flurry of meetings and travels inside and out of the region is building an impression that something could be going on. Yesterday, the White House confirmed Jared Kushner’s secret visit to Saudi Arabia, and Jason Greenblatt and David Friedman visited Bibi. Meanwhile, Finance Minister Moshe Kahlon discreetly made his way to Ramallah, to meet with Palestinian PM Rami Hamdallah and other high-level Palestinian officials. This is the second time Kahlon met Hamdallah this year, constituting the highest-level open channel between Jerusalem and Ramallah, and the first time since Palestinian reconciliation was announced.

“We talked about things that were stuck, after the security cabinet authorized us to move forward with some things,” Kahlon said, keeping things vague, but emphasizing that the meeting was about economic and not diplomatic issues. “The White House was updated about this. We made it clear that we have no problem continuing economic steps with the Palestinians, but we will not recognize unity with Hamas until our boys are home and Hamas gets rid of its weapons…We cannot live with incitement.”

The meeting had been postponed for months, due to recurring terror attacks. Kafe Knesset has learned that the godfather of the get-together was Jason Greenblatt, who met Kahlon last week and urged him to meet Hamdallah and move forward with several economic initiatives and make progress. As a proud father, after the meeting Greenblatt tweeted: “Meaningful steps forward on key economic issues – revenues, customs, and investment – that help support the search for peace.” Jerusalem is buzzing with rumors, speculation, and headlines about an upcoming breakthrough on the Israeli-Palestinian front, and according to one well-informed source – the Palestinian issue was also big during Steve Mnuchin’s visit last week. “Trump’s envoys are determined to present him with an achievement by the end of the year, and are now on a ‘blitz’ pushing to move forward, either politically or economically,” the source said.

Settlers pitch a tent: But, as usual, US pressure tends to be countered by an opposite vector: the settlers. Netanyahu’s favorite electoral base is already discontent with the government, and a protest tent was established last week outside the PM’s Balfour residence demanding that the government move forward with a broad security, road and infrastructure plan aimed at increasing the settlements’ security. Last night, about 2,000 demonstrators arrived at the tent. Netanyahu is trying to brush off the criticism and has promised the settlers the plan is underway but they are not taking him at his word so far. And they are not happy with the fact that Netanyahu decided to postpone legislation that would annex Jewish neighborhoods into Jerusalem, due to White House pressure. Netanyahu told Likud ministers yesterday that “just like we have been cooperating with the US until now, we should continue talking and coordinating with them. We are working to promote and develop the settlements and no other consideration.”