Well, here's Rubin's over-wrought and over-thought response:
None of this is untrue, of course. But it's over-wrought because it's set in a vacuum. King Hussein has been dead a long time, way before the Iraq War (the one with the "bad Hussein"). Reading Rubin's comments shows how he completely lacks context. Obama's off the cuff comment was made to American media outlets in front of American news cameras, so his audience was almost certainly American. And it's clear that a great many Americans do not like that his middle name is Hussein; otherwise, why would Ann Coulter and Rush Limbaugh and a whole host of right-wing media types have made such a big deal of it during his campaign in 2008? In fact, Coulter referred to him as "B. Hussein Obama" in many of her columns. Right wingers also "mistakenly" referred to him as "Obama bin Laden" or "Barack Osama." The whole idea was to cement the link between terrorism/Islamism/"Other-ism" and the Democrat from Illinois. Further, the Israeli government and political climate is about as close to the American neocon right as it has ever been.
Obama was initially--when he had the same name as he does now--quite popular in Israel as polls show. Only when he evinced hostility did the attitude of Israelis change sharply.
[Also], that same name belies the implication that Israelis are biased against him because of his middle name. Israelis, after all, have dealt with two famous Husseins: King Hussein of Jordan and Saddam Hussein of Iraq. The former was a good friend, the most popular Arab leader in Israeli history. (Note 1)
So one can be a good Hussein or a bad Hussein. Of course the issue with this third Hussein is his policies. And that's why I find his saying this thing far more upsetting.
So yeah, while the comment was off the cuff, it was certainly on the mark in chiding people for putting so much stock in his name. Of course, as the right sees it, his deeds have generated a lot more grist for their mill, but that's besides the point. In general, the political machine on the right will seize on ephemeral shit like this to score points whenever possible. And Rubin does not disappoint.