WHEN THE LOS ANGELES Jewish Federation Council initially balked at the prospect of underwriting CBS-TV's "America Salutes Israel" jubilee broadcast last April - a $ 600,000 investment - Haim Saban reached for his wallet with the aplomb of one of Zero Mostel's check-happy little old ladies in Mel Brook's classic comedy "The Producers."

"When I understood that the whole event may be in jeopardy," Saban told The Jerusalem Report, "I thought, well, I've got to do something, because it's an incredible opportunity: having a celebration of the 50th anniversary on an American network that has a potential of reaching 98 million homes, and showing a side of Israel that is not just the soldiers going out and fighting stone-throwing kids."

The Federation eventually took up the project - in association with the Simon Wiesenthal Center and the Israeli Consulate - leaving Saban to beat a quiet retreat to the sidelines.

Saban remains ever willing to come to Israel's defense, though in a freewheeling conversation with The Report, he was at no pains to conceal his antipathy toward Prime Minister Benjamin Netanyahu. His feelings seem to have two sources. Personally, he's still annoyed by Netanyahu's cavalier treatment two years ago of a high-powered Los Angeles mission Saban participated in alongside Mayor Richard Riordan. Beyond that, though, Saban is convinced that Netanyahu is deliberately undermining Israeli relations with the first "viscerally pro-Israeli president" in generations. That may be the reason that, despite the current U.S. administration's - from Saban's business perspective - meddlesome approach to TV programming, Saban is a dedicated Democrat and FOB (Friend of Bill Clinton's).

The Jerusalem Report: So how tough are you, really?

Haim Saban: I'm not tough at all. But Israelis have the reputation of being tough. You can be tough in business and be a softy when it comes to social and charitable matters. You can be tough across the board. Labeling a whole nation as tough - I don't see the upside with it.

Your behavior with your creditors after the harp concert debacle in 1973 established you as a man of your word. In Hollywood, is there an upside to that?

I believe that being a man of honor in business pays dividends in the long term. Outside of the fact that I have to look at myself in the mirror each morning, it's the right business decision, a win-win situation, when you keep your word to people. You don't have any downside in it.

It's been said that you became active in domestic American politics because you wanted to head off further government regulation of your business.

Actually, I started getting involved politically when (then-U.S. president George) Bush reneged on his promise for the $ 10-billion loan guarantees (to Israel). That threw me. I was neither Republican nor Democrat - I had my own problems. But I was always a very concerned Israeli. I love Israel, I am proud of Israel and I haven't changed my name from Haim to Mike. When Bush did that, I thought we are too dependent on the U.S. at multiple levels, and that we needed more of a voice on the Hill.

Frankly, this administration, for our business, couldn't be worse. Three hours of educational programming, the V-Chip, the self-ratings, the Gore business… But this is also an administration led by a president viscerally committed to the State of Israel. This is not only a mentally calculated commitment - it's personal and spiritual, and we need to reciprocate.

Perhaps you have to tell that to Israel.

The fish stinks from the head. We have an extremely arrogant prime minister who walks through life thinking he doesn't need anybody. As long as he can stay prime minister - the only thing of concern to him - via the compromises with this one and lying to that one and cheating with that one, he's happy. I don't think when he deals with the U.S., Bibi Netanyahu understands that we can keep our dignity and pride while recognizing that the U.S. is the superpower and not us. You don't have to give up your dignity and honor, or threaten to burn down Washington. But it's not "L'etat c'est moi" with him - it's "Le monde c'est moi." We're in big trouble. It's a disaster.

You are a big fan of Shimon Peres and a major contributor to his Peace Institute.

Shimon Peres for me is "from Dimonah to Oslo," and those who understand, understand. He is a 73-year-old man who gave 50 years of his life to the country, and to the best of my knowledge his bank account is still only $ 33,000 rich. Because of those two facts, I don't ask questions. If he says "Jump" and I can, I will. I believe that if he had not been allowed to go forward with his vision of Dimonah, where we allegedly have atomic power, maybe the state wouldn't exist today. We all owe a lot to Peres. I revere him. I don't call him Shimon. I call him Mr. Peres.

I get the feeling that you believe that if businessmen such as yourself had been asked to cut a deal with the Palestinians, you would have done so long ago.

It is not even a question in my mind. It would have been easier to cut than the Screen Actors Guild deal. So many deals you can make with these guys. They are $ 1,000 a year revenue per capita, we're $ 16,000. We're ahead of France. They have 12,000 guns which we gave them? We have a few more. What are we afraid of? One percent, 16 percent, 11 percent, defendable, not defendable… it's the biggest load of baloney. People who have a personal vested interest in their well-being don't go to war. People who go to war and blow themselves up are people who are against the wall and have nothing to lose.