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Netanyahu Keeps Coalition as Hawkish Rival Gets Back in Line

Netanyahu Keeps Coalition as Hawkish Rival Gets Back in Line

(Bloomberg) -- Israeli Prime Minister Benjamin Netanyahu succeeded in keeping his tottering governing coalition together, as a hawkish rival who was denied the defense portfolio said he would give the government more time to toughen its approach against Hamas militants in Gaza.

Education Minister Naftali Bennett, who was widely expected to topple the government by pulling his eight-person Jewish Home party out of the coalition, instead said he will stay for now. Israel’s benchmark stock index extended its gains after the announcement and the shekel reversed earlier losses.

Netanyahu Keeps Coalition as Hawkish Rival Gets Back in Line

Bennett’s shift comes after Netanyahu, in a prime-time speech Sunday night, said he would not make Bennett defense minister. He called coalition rebels “irresponsible” for considering bringing down the government while Israel faces threats on its northern and southern borders.

“I want to believe Netanyahu,” Bennett said in a news conference at the Knesset, alluding to the prime minister’s promises of a stern response to any attacks on Israel. “The test will be deeds, not words.”

Razor-Thin Majority

The crisis was triggered Nov. 14 when Defense Minister Avigdor Liberman quit and pulled his Yisrael Beitenu party’s five legislators from the government, saying it wasn’t responding forcefully enough to hundreds of rockets fired by Palestinian militants in Gaza. That left Netanyahu with the support of just 61 members of the 120-seat parliament.

If Jewish Home also left the government, Netanyahu would lose his majority and early elections would likely be called.

Elections currently are slated for November 2019, but no Israeli coalition in the past 30 years has served out its term. The current one, formed in 2015, is one of the longest-lasting. Israeli commentators had predicted elections would be advanced to March.

Netanyahu Keeps Coalition as Hawkish Rival Gets Back in Line

Netanyahu succeeded in buying himself some time, but the question of how to deal with Gaza will remain explosive, said Hebrew University political scientist Gideon Rahat, a senior associate at the Israel Democracy Institute.

“Israel’s politics are in the hands of Hamas,” he said. “We see that Netanyahu is very strong, but Hamas can give him trouble.”

Election Genie

Polls suggest a new vote wouldn’t produce a significantly changed parliament. According to a Hadashot News poll Saturday, Netanyahu’s Likud would remain the dominant party if elections were held today, with its representation stable at 30 seats; Bennett’s Jewish Home party would rise slightly to 10 seats.

Bennett and Finance Minister Moshe Kahlon, who had urged early elections, both said they expected Netanyahu to win another term atop a conservative government.

However, such calculations have proven wrong in the past once the election genie is out of the bottle. In recent days, Netanyahu has recalled how in 1992 hardliners toppled a Likud-led government, expecting to further strengthen the right’s hold. Instead, the left-wing Labor Party swept to power under Yitzhak Rabin and signed a peace accord with the Palestinians, what Netanyahu called the “Oslo disaster.”

Labor today is part of the Zionist Union faction, which would fall from 24 seats to 12 in new elections, according to the Hadashot News poll. The big winner would be Yair Lapid’s centrist Yesh Atid party, which would rise to 18 seats from 11.

Another factor in eventual elections is the possibility that Netanyahu could be indicted in an ongoing corruption probe. Attorney General Avihai Mandelblit is due to decide whether to charge the prime minister in several cases involving alleged influence-trading. Netanyahu denies any wrongdoing.

--With assistance from Gwen Ackerman.

To contact the reporter on this story: Michael S. Arnold in Tel Aviv at marnold48@bloomberg.net

To contact the editors responsible for this story: Alaa Shahine at asalha@bloomberg.net, Mark Williams

©2018 Bloomberg L.P.