The most striking aspect of the Israeli spying leak
In a report entitled "Israel Spied on Iran Nuclear Talks With US," the Journal quotes anonymous Obama administration officials who claim that an Israeli intelligence operation had obtained information from confidential nuclear talks between the US and Iran.
Israel then allegedly relayed that information to US lawmakers - who had apparently been kept in the dark about the US's actual negotiating positions - in order to build a case against a coming nuclear agreement.
Details are sparse - Israel reportedly obtained information from confidential briefings, but the report and its anonymous sources offer no proof that Israel intercepted it from spying on US rather than Iranian or other allied targets.
In fact, the only confirmed spying between allies in the entire piece comes in the course of disclosing the alleged Israeli operation (emphasis ours):
The White House discovered the operation, in fact, when U.S. intelligence agencies spying on Israel intercepted communications among Israeli officials that carried details the U.S. believed could have come only from access to the confidential talks, officials briefed on the matter said.
So US officials disclosed a confidential counter-intelligence operation against an ally in order to float a factually vague accusation that that ally was in fact spying on them.
Spying among friends
It isn't out of the question that Israel would spy on Iran negotiations. Israel is considered one of the "big four" counter-intelligence threats to the US, alongside Russia, China, and Cuba. And preventing Iran from acquiring a nuclear weapon is virtually the only issue on which he's shown any consistency over the course of Israeli Prime Minister Benjamin Netanyahu's nearly three-decade political career.
On the other hand, the news of the mere existence of a counter-intel operation against Israel like the one described is damaging to US-Israel relations, since it shows the US has no problem with admitting that it's spying against its Middle Eastern ally.
It also makes it less credible for US leaders to claim that they don't spy on allies - an assertion American officials have had to make with perhaps unprecedented frequency in the wake of the Edward Snowden disclosures.
To top it off, disclosing such an operation is almost certainly violates whatever federal security clearances the WSJ sources held. Someone in the Obama administration believed it was worth breaking US federal law in order to score point against the Israelis in the midst of both a sensitive nuclear negotiation with Iran and turbulence in US-Israel relations in the wake Netanyahu's reelection.
That's the trade-off at the heart of what the WSJ discovered: Administration officials thought it would be worth exposing a national security secret in order to smooth the way for a nuclear agreement with Iran.
