In what appears to be the worst crisis yet for the governing coalition, sources close to Prime Minister Benjamin Netanyahu on Wednesday threatened to fire Economy and Trade Minister Naftali Bennett over his criticism of Netanyahu a day earlier.

“Bennett was given a message that he has to apologize clearly and unequivocally or there will be a price to pay,” a source in the Prime Minister’s Office told The Times of Israel.

On Tuesday, Bennett delivered a speech lambasting the prime minister in the wake of a Times of Israel report according to which Netanyahu wants Jewish settlers to be given the choice of living under future Palestinian rule in the West Bank if a peace treaty is sealed.

“No one will teach Netanyahu what it means to love Israel or to defend it. With all Bennett’s complaints, it’s not clear why he’s clinging to his seat in the cabinet,” the official said in an unusually sharp rebuke. “Bennett’s brazen and irresponsible behavior won’t be ignored. It does damage to the interests of [Jewish] settlement [in the West Bank].”

The official then added the most direct threat Netanyahu has given a coalition partner since the current government was formed last March. “If Bennett won’t apologize, he will endanger the composition of the current government. Netanyahu has enough alternatives. Even a government without Bennett will know how to secure Israel’s citizens – just like the last government, which was headed by Netanyahu, managed to do.”

Prime Minister Benjamin Netanyahu and Economy Minister Naftali Bennett during a Knesset plenum session, July 29, 2013. (photo credit: Flash90)

Prime Minister Benjamin Netanyahu and Economy Minister Naftali Bennett during a Knesset plenum session, July 29, 2013. (photo credit: Flash90)

A senior PMO official told The Times of Israel on Sunday that the prime minister was insisting that Jewish West Bank settlers be given the choice to remain in place and live under Palestinian rule, or relocate to areas under Israeli sovereign rule. The official was explaining and elaborating on comments made Friday by Netanyahu during a press conference in Davos, Switzerland. “I have said in the past, and I repeat today: I do not intend to remove a single settlement. I do not intend to displace a single Israeli,” Netanyahu said at the conference.

“His consistent position has been that those settlements that will be on the Palestinian side of the border should not be uprooted,” the well-placed official said. “Just as Israel has an Arab minority, the prime minister doesn’t see why Palestine can’t have a Jewish minority. The Jews living on their side should have a choice whether they want to stay or not.”

Netanyahu first hinted at this position in his May 2011 speech to the US Congress in Washington, the official noted. “The status of the settlements will be decided only in negotiations,” Netanyahu said at the time. “In any peace agreement that ends the conflict, some settlements will end up beyond Israel’s borders.”

During that speech, he did not explicitly state that settlers located east of the border must be given the option to stay, but he has said so in several meetings in recent weeks, the official said.

Bennett has issued several denunciations of the idea since Sunday.

The Jewish Home's campaign ad depicting Benjamin Netanyahu beside Naftali Bennett (photo credit: Ron Friedman/Times of Israel)

A Jewish Home party campaign ad for the January 2013 parliamentary elections depicting Benjamin Netanyahu beside party leader Naftali Bennett, under the slogan ‘Strong together.’ (photo credit: Ron Friedman/Times of Israel)

In a speech Tuesday at the Institute for National Security Studies security conference in Tel Aviv, Bennett, who heads the Orthodox-nationalist Jewish Home party and is opposed to an Israeli withdrawal from territory in the West Bank, blasted Netanyahu’s handling of the ongoing US-brokered negotiations.

The Palestinians “understand we’re not going to evaporate, and we understand they’re not going to evaporate. There is a quiet acceptance. So to take this situation and overturn it with another Oslo-like idea… the heart breaks,” Bennett said.

“Our forefathers and our descendants will not forgive an Israeli leader who gives up our country and divides our capital,” Bennett declared in what could be construed as a warning to Netanyahu. He also suggested that the government’s growing fear of boycotts “is what will bring on the boycott. This is no way to handle negotiations, running frightened between the capitals of the world.”

On Sunday, Bennett posted a Facebook statement that said the idea of settlers saying on in “Palestine,” “reflects the loss of a moral compass. We didn’t experience 2,000 years of yearning for the Land of Israel so that we could live under the government of Abu Mazen (Palestinian Authority President Mahmoud Abbas). Anyone thinking of placing the lives of Jews in the Land of Israel under Palestinian rule is pulling the rug out from under our presence in Tel Aviv.

“I call on the prime minister to immediately reject this terrible idea,” he concluded.

In his speech on Tuesday, Bennett offered a more immediate concern with leaving Jews under Palestinian rule.

“Do you know why, why Jews cannot live under Palestinian rule, why Palestinians can’t rule over Jews? Because they will kill them,” Bennett said at a conference in Tel Aviv. “And do you know how I know this? Because it has already happened.”

Bennett went on to recount in gory detail some of the events of the 1929 massacre in Hebron, in which 67 Jews were killed during Arab riots, and of the lynching of two off-duty IDF soldiers in Ramallah in 2000 who had sought refuge in a Palestinian police station.

Jewish Home MK Ayelet Shaked, March 11, 2013. (photo credit: Miriam Alster/Flash90)

Jewish Home MK Ayelet Shaked, March 11, 2013. (photo credit: Miriam Alster/Flash90)

Bennett’s closest confidante, MK Ayelet Shaked (Jewish Home), attempted to calm the escalating row between the two leaders on Wednesday.

“Minister Bennett spoke about his moral stance regarding the idea of leaving Jews under Palestinian rule,” she told Israel Radio. “Minister Bennett never said anything personal against the prime minister. Not one word attacks the prime minister personally. But [Bennett] sees it as his duty to attack this trial balloon. Morally and practically, we feel this idea of transferring Jewish towns to Palestinian rule is a dangerous, un-Zionist act. We were not elected to stand silent,” he said.

Some MKs expressed support for Bennett, while others called on him to apologize.

Transportation Minister Yisrael Katz, considered a member of the hawkish flank in Netanyahu’s Likud party, called Bennett “my friend,” but urged him, “specifically because of our similar views, to apologize to the prime minister. The argument over where Jews will live under a future agreement is a pointless one. Only yesterday, [Abbas] reiterated his demands for a ‘just solution’ to five million Palestinian refugees, and [said] that Jerusalem, including the Old City, will be the Palestinian capital. With such stances [on the other side], there is no chance of an agreement in any case. So why divide our forces?” Katz said.

But others on the right were distinctly more disposed toward Bennett. MK Yoni Chetboun, of Bennett’s Jewish Home party, said “it is a great privilege to be reprimanded for insisting that Jews live under Israeli sovereignty. It’s time to lead with clear values in the face of the Arabs of Judea and Samaria (the West Bank) and the rest of the world,” he said.

MK Tzipi Hotovely in the Knesset, March 2011. (photo credit: Abir Sultan/Flash 90)

MK Tzipi Hotovely in the Knesset, March 2011. (photo credit: Abir Sultan/Flash 90)

Likud MK Tzipi Hotovely explained why it was important to challenge Netanyahu.

“When all the tactical moves like this week’s trial balloon are taken together,” she wrote in a statement posted to Facebook on Tuesday, “they create a loss of direction. [Abbas’s] real face is clear to all, in light of his words and deeds. There is no need for political acrobatics to show the world which side is rejecting peace.”

Those, like Hotovely, who are resisting the prime minister’s moves, she wrote, “are creating a foundation for Netanyahu to be able to say to the Americans that he doesn’t have the political base to establish a Palestinian state. We’re not planning to replace Netanyahu, but to set political boundaries.”

Raphael Ahren and Spencer Ho contributed to this report.