Highlights
-Kadima party wins more seats, but Likud party has more support
-Peace process likely to stagnate under a Likud-led coalition
-Palestinians remain the losers of the Israeli election
Technically, in last week’s Israeli elections the center-right Kadima party led by Tzipi Livni won the general elections, defeating the ring wing Likud party led by Binyamin Netanyahu by one seat in the Israeli Assembly. Overall however, Israeli political sentiment continued a slow but steady swing to the right, which commenced among Israelis following the end of the 2006 conflict in southern Lebanon between the Israeli Defense Forces (IDF) and the Lebanese Hezbollah militia. The result is a political standoff unlike any seen in Israeli history.
Despite Kadima’s overall win, Likud controls the emerging majority political coalition through the ability to build a narrow, right-wing majority.
Likud has more natural political allies to be seated in the Knesset. Foremost among them is the Israel Beytenu party led by the controversial Avigdor Lieberman, who gained 15 seats, and the ultra orthodox Shas party that earned 11 seats; just less then the 12 seats it was predicted to take on the eve of the election.
Livni faces similar challenges in organizing a Kadima-led government. She likely will not be able to form a coalition government without Likud, or without moving significantly to the political left and against the grain of growing Israeli sentiment for improved security.
Forming a government is hard. The mix is complicated by the fact that we believe Netanyahu doesn’t want to be constrained by a government dominated by far right and ultra-orthodox parties. With his legacy on the line after 10 years of waiting to return to the Prime Minister post, Netanyahu most likely wants to lead a broad based government that includes Kadima notables and even a few Labor leaders with strong credentials, such as former Prime Minister Ehud Barak.
An Acceptable Solution
Israeli President Shimon Peres will break the deadlock when he invites either Livni or Netanyahu to form a government. Peres’ decision-making should be guided by the priority of selecting the party most likely to form a government. However, as this TIR goes to press, we predict a Likud-led coalition with Kadima and several parties in the far right. The challenge here is what level of Prime Minister power-sharing will Livni accept. A rotating Prime Minister post will be acceptable to all, please no one, and likely collapse within four years.
The United States
More than numbers in the Knesset will likely guide Peres’ decision. The Israeli election did not happen in a vacuum. The modest swing to the right in Israel departed from the United States recent elections. Both Livni and Netanyahu are aware that the new US administration is reforming policies that will likely make the ongoing Middle East Peace Process more important and more complex.
The paradox of Israeli politics is that often serious peace negotiations emerge from Likud led governments; and Netanyahu, more than most, likely wishes to write his political history as a strong security proponent and also a peacemaker. With the Obama Administration in power, new opportunities will emerge for Israelis to both pressure and coax an admittedly fractured Palestinian leadership toward a mutually recognized architecture for peace.
Netanyahu brings both personal gravitas and the required number of seats to form a government, but the political make-up of his coalition is not optimized for him to use a coalition government as a platform for both conflict and peace making with the Palestinians. As he makes his decisions, Peres will likely consider how well a liberal U.S. Administration and a far right Israeli coalition government will get along regarding the peace process, and other areas of mutual concern – increasing the appeal of a Likud-Kadima fusion.
Iran
Iran’s sustained aggressive rhetoric plays into Likud’s hands, but also constrains it. Likud and its right wing allies are best able to articulate a security policy in the face of near term Iranian acquisition of nuclear weapons. But a narrow center right government may also be forced to act, creating less stability in the region, rattling nerves, and causing spikes in commodity prices.
The Palestinians
The losers in the Israeli election are the Palestinian people. No matter the outcome, the Israeli drift to the right and increased emphasis on security almost ensure hard times for the average Palestinian family, who will continue to suffer from poor leadership, Israeli pressure, and a devastated infrastructure in Gaza. No amount of US pressure from a more balanced Obama Administration led by Special Envoy George Mitchell on either a Likud-Kadima coalition, or any Likud led far right government, will stop Israel from future incursions into Gaza if it feels it must in order to stop rocket attacks, and otherwise protect its security.
