Israel is at the precipice. If something doesn’t give by Monday, the 23rd Knesset must dissolve and the country will head to elections in late November — for the fourth time since April 2019.
If the Knesset dissolves this week, the country will go to elections without an updated budget for 2020. At least 15 billion shekels ($4.4 billion) will be missing from the roughly NIS 415 billion ($122 billion) the government needs to maintain its routine operating budget, according to figures presented to the Knesset last month. Youth at risk programs will shutter — many already have — and schools will see drastic cuts. Hospitals will be affected. So will the army, the police, social workers and nurses — all the apparatuses of the state now working overtime to battle the pandemic. No small part of the non-governmental sector, including some of the country’s most vital charities, will also see drastic budget cuts.
That condition will last past November, of course. An election in November only begins the new coalition-building process, which could last as much as two or even three months. If a new government is successfully sworn in around January, say, it will then begin the hard work of cobbling together a budget for the year that was past and the year ahead.
And throughout that period of instability, bitterly divisive campaigning and political strife, Israelis will still be grappling with the pandemic, which is expected to worsen in the winter months, and with an economic crash whose end is still nowhere in sight.
It’s a nightmare scenario that will most hurt those parts of Israeli society — youth at risk, impoverished schools, small business owners — least able to cope with the shock.
There is no substance to the fight, only politics.
Netanyahu’s Likud and Gantz’s Blue and White are bickering over whether the country passes a one-year budget covering 2020 or a two-year budget covering both 2020 and 2021.
Netanyahu is demanding a one-year budget, and no serious economist, in government or out, has come out strongly in his defense. Gantz is demanding a two-year one, and no serious economist, in government or out, has come out strongly in his defense. The general consensus among economists appears to be that budgeting is important, forward-looking policymaking is critical, and the sooner the politicians get any budget in place the better.
But there are vast political ramifications to the fight. The coalition agreement Netanyahu signed last May explicitly states that the government will pass a two-year budget covering 2020 and 2021. The trouble for Netanyahu is simple: Under the agreement, if he forces new elections before Gantz’s turn as prime minister comes up, then Gantz becomes the interim prime minister in the months leading up to election day. For the first time in 11 years, Netanyahu will not be prime minister.
Unless, that is, the government falls because a budget fails to pass.
Netanyahu is demanding from Gantz to switch to a one-year budget, and ordered the Finance Ministry to produce no other kind in blatant violation of his coalition agreement, because that means the government will then have to pass yet another state budget covering 2021 by this coming March.
That is, even if the government survives the current fight, Netanyahu still has an “exit ramp” — as the moment has come to be called in the Knesset — for dissolving the parliament in the spring and calling new elections without ever surrendering his seat to Gantz.
From the moment the two men signed the agreement, Netanyahu began to look for ways to cheat. There were no obvious avenues within the rules of the agreement, so he simply broke those commitments.
That point isn’t even partisan. Likud MKs, when not on television, acknowledge it openly, sometimes with an embarrassed smile and sometimes with a triumphant one.
Naftali Bennett, head of the right-wing Yamina faction, has told associates — the sort of associates one tells when one wants political reporters to hear about it but doesn’t want to say it outright — that he is no longer willing to be a junior member in a Netanyahu government. He’s polling as high as 19 seats now (the faction won six seats in the March election), and would only settle for a rotation in the prime minister’s chair.
Oh, and Bennett would have to go first, his associates have said. After the PM’s treatment of Gantz, no one believes Netanyahu enough to accept anything but political cash on delivery.
Yet none of that — not the terrible harm new elections would inflict on Israeli society nor the egregious way Netanyahu has broken his pledges — answers the most urgent question: Will he do it? Will Netanyahu, in his unceasing efforts to outmaneuver his purported coalition partner, take the country over the edge?
He certainly wants everyone to think so.
On Wednesday, Netanyahu pivoted noticeably from pretending to be trying to prevent elections to pretending to all but announce them. Until Wednesday, he’d insisted that “everything must be done” to head off elections.
Then he visited the Mahane Yehuda open-air market in Jerusalem, a favorite spot for electioneering.
Separately, excited patrons at a restaurant in central Israel shared a grainy photo of his campaign chiefs, including spokesman Yonatan Urich and former campaign manager Ofer Golan, in intense consultation a few tables over. The photograph was an act of political theater, if only because no ordinary Israeli would casually identify the men, nor, presumably, be so thrilled by it that they’d feel compelled to send unbidden a photograph of the event to political reporters.
Beginning Wednesday, Likud MKs started receiving instructions with talking points every few hours, and were told to go on television to find opportunities to make those points heard.
It was full campaign mode. Netanyahu was broadcasting that he was in an election posture.
Is an election imminent, then?
The simple truth is that no one really knows. A senior Likud official told the Times of Israel this week there was a 30 percent chance of elections now and a 70% chance a compromise will be reached delaying the collapse.
In other words, Likud’s own senior officials are themselves guessing about Netanyahu’s intentions.
An election now may be profoundly risky for the Likud leader.
Some of the reasons are well known and obvious in every poll. Likud lost a great deal of the luster it had during the spring months, when Netanyahu was widely perceived as successfully managing the first wave of the pandemic.
From polls showing it at a whopping 40 seats, Netanyahu is now lucky to poll at 30. His opponent Bennett, meanwhile, has seen Yamina rise from six to 19, much of the rally drawn from Likud supporters disenchanted by Netanyahu.
In terms of coalition math, that means that right-wing voters have a new non-Netanyahu route to the premiership: if Bennett and Yesh Atid’s Yair Lapid do well at the ballot box, they could win almost 40 seats between them. Add perhaps seven for Gantz’s Blue and White (according to current polls), perhaps eight for Avigdor Liberman’s Yisrael Beytenu party and the mere abstention of the Arab Joint List, and one has an easy government. (There are overlaps, it may surprise some observers to learn, between the agendas of the Jewish religious right and the Arab political factions, including on questions of municipal budgets and policing.)
And once they realize they’re left out of power, it would be hard to imagine the Haredi parties risking a term in opposition and watching funding dry up for their institutions.
The point isn’t to argue that that scenario is the most likely, but coalition sources have confirmed that it’s one entertained by Netanyahu and his advisers in recent days. The very fact that such a scenario is possible is based on two factors. First, polls don’t show a knockout victory for Netanyahu in any scenario. He’d have the largest party after an election, but his right-wing coalition polls only very slightly ahead of parties committed to his removal.
Second, no one in the political system trusts Netanyahu anymore. His great advantage until now has been the tight-knit nature of his allied factions. His opponents, ranging from right-wing secularist Yisrael Beytenu to the non- or anti-Zionist Joint List, could never cohere into a unified opposing camp.
But Netanyahu’s comprehensive dishonesty over the past three months have made a dent in that advantage. There are no more Gantzes in the Israeli political system, not even among Netanyahu’s closest friends, who are willing to risk their political future on a pledge from him.
And there there’s his tax refund request, which shattered something vital in his political persona.
On June 21, Prime Minister’s Office Acting Director General Ronen Peretz brought a bill to the Knesset Finance Committee that sought to amend the list of expenses recognized for tax purposes for a sitting prime minister.
The bill was ostensibly part of the coalition agreement, and claimed to equalize the salary conditions of the prime minister and the alternate prime minister. That it was drafted in Netanyahu’s office was at first taken as a good sign — a sign that Netanyahu planned to serve as “alternate prime minister,” fulfilling his commitments in the coalition agreement.
But then the Finance Committee began to read the document carefully, discovering that under the excuse of fulfilling the coalition agreement, Netanyahu had introduced unprecedented new tax breaks for himself and applied them over a decade backwards. Under the new rules, most of the costs of operating Netanyahu’s Caesaria villa would become tax deductible, including retroactively. If the bill had passed, Israel’s multi-millionaire prime minister would suddenly be owed hundreds of thousands of shekels from the state treasury. Even the water in the private pool in his private home would count as a write-off.
The bill landed in the Knesset committee in the same week that the Finance Ministry reported 750,000 newly unemployed, tens of thousands of small businesses shuttered — and a state budget bill and coronavirus rescue package that were failing to pass through the same committee.
The committee spent a valuable day bickering about Netanyahu’s request, and coalition chairman MK Miki Zohar (Likud) insisted on national television, incorrectly, that no prime minister in history was required to pay the taxes being asked of Netanyahu. (No prime minister in history had applied for the tax breaks Netanyahu applied for.)
The story died soon after. The political news cycle moved on.
But political reporters who speak regularly with Likud members since then have heard about the incident repeatedly. It sank into the consciousness of Netanyahu’s base. It hurt him deeper than he seems to realize. It is cited constantly by Likud members as an explanation for Bennett’s soaring poll numbers.
As Meir Micha, the famed owner of the iconic Pinati hummus restaurant in downtown Jerusalem, a symbol of Jerusalem’s Mizrahi working class and a lifelong Likud supporter, put it in July: “Why do we have to reach this point, after 40 years, where I can’t pay my suppliers? Why? He’s dealing with his pool, with the water in his pool. What are you even talking about? He used to be a god to us, Bibi.”
So will Netanyahu force new elections on Monday?
It’s relatively easy to study the views and predict the behavior of millions. It is almost impossible to predict the actions of a single person. Netanyahu, a grizzled veteran of Israeli political skirmishes, may see factors at play that others don’t. Human folly is always a possibility; he may have grown short-sighted and cocky after 11 long years in power.
There is no cost to him if he passes the bill now sitting on the Knesset docket to delay the budget deadline for 100 days, pushing off the Knesset’s dissolution until early December. By then Netanyahu might hope for more favorable polls showing less support for Bennett, a recovery for Likud, a decline in anger among his base, and the like.
And if conditions still don’t improve by December, another bill could delay the Knesset’s dissolution even further — still without a budget, still with Israelis reeling from the uncertainty and the shuttering of vital government programs. If an election remains foolish, what harm is there — to Netanyahu personally, of course, not to the country — in endlessly hovering at the lip of one?