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This article appears in the February 1, 2013 issue of Executive Intelligence Review.

Bibi Netanyahu's Humiliating Defeat

by Jeffrey Steinberg

[PDF version of this article]

Jan. 30—Going into the Jan. 22 Knesset elections in Israel, nearly every pundit and pollster in Israel and the United States was forecasting an overwhelming electoral victory for Prime Minister Benjamin Netanyahu and his right-wing and ultra-Orthodox bloc of parties.

But when the dust settled, Netanyahu had suffered a humiliating defeat which raises serious questions about Israel's direction in the near future. While Netanyahu's Likud-Beiteinu bloc won the largest bloc of Knesset seats, the coalition lost 11 seats and Netanyahu's Likud party, minus the "Russian party" of his ex-Foreign Minister Avigdor Lieberman, received the same number of seats as the newly formed centrist party of television news anchor-turned-politician Yair Lapid. Lapid's There Is a Future party got an unexpected 19 seats, in what was a clear vote of no-confidence in Bibi.

Al-Monitor Israeli correspondent Ben Caspit called the vote a "resounding vote of no-confidence," and a "devastating political blow" to Netanyahu. While President Shimon Peres is still expected to ask Netanyahu to attempt to form a new government over the next 30 days, it is unclear what kind of coalition Bibi will be able to cobble together, not to mention whether he will be able to govern, even if he does succeed.

Bigger Troubles Yet

Netanyahu clearly did suffer a smashing defeat at the polls. Voters made clear that they are more concerned about the bread-and-butter issues such as the skyrocketing cost of living inside the Green Line (the pre-1967 borders of Israel), the special treatment given to the ultra-Orthodox, who do not have to serve in the Israeli Army and who are subsidized at taxpayers expense, and the even more lavish benefits given to West Bank settlers, than about Bibi's war rhetoric.

And even beyond his electoral problems, Netanyahu is facing a growing challenge from within the Israeli governing institutions. For the past two years, leading Israeli Defense Force (IDF), Mossad, and Shin Bet officials have been waging war against Netanyahu's provocations against Iran, warning that he and his former Defense Minister Ehud Barak have isolated Israel from the rest of the world, and created conditions in the region that pose a deadly threat to the very survival of the nation.

Now, a widely circulating documentary film by noted film maker Dior Moreh has delivered a further blow to Netanyahu. The Gatekeepers is based on interviews with six former heads of Israel's internal security agency Shin Bet, all of whom pillory Netanyahu for turning the world against Israel. One of the six, Avraham Shalom (1981-86), told Moreh that the Israeli occupation of the West Bank is no different than the Nazi occupation of Europe during World War II. Such a direct reference to the Holocaust—effectively accusing Netanyahu of Nazi war crimes—breaks a decades-old taboo, and indicates just how much leading institutional circles in Israel are seeing the country facing an existential crisis that demands bold action and blunt language.

Even Jeffrey Goldberg, an American neoconservative writer who served in the IDF, admitted in a Jan. 14 Bloomberg News article that Israel's behavior is a greater threat to the survival of the Jewish state than any threats coming from Iran.

Tzipi Livni, a career Mossad officer who served as Foreign Minister in the Ehud Olmert government, has formed a new center-left political party, The Movement, with two former chairmen of the Labor Party, Amir Peretz and Amram Mitzna. That new party won six seats in the Knesset. All told, the total number of seats of the center-left parties in the incoming Knesset are 59, compared to 61 seats for the right-wing and ultra-Orthodox parties. Naftali Bennett, a fanatical Greater Israel figure, whose new party campaigned for Israeli annexation of much of the Palestinian West Bank, also siphoned votes from Netanyahu's Likud.

Adding further problems for Netanyahu and his effort to stitch together a ruling majority, Livni went on Israeli Television 1 soon after the election and charged that Netanyahu and Lieberman had received $4.5 million in illegal campaign funds from the Emir of Qatar, in return for a pledge to open negotiations directly with Hamas.

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