Prime Minister Benjamin Netanyahu seems to be plunging headlong toward new elections — while also taking steps to avoid them. The combination has led to much head-scratching, as Israelis try to understand where they’re being led.
The case that Netanyahu is trying to force his unity government to fall is an easy one to make. The main evidence: the prime minister’s serial violations of the coalition agreement he signed with Blue and White leader Benny Gantz just 84 days ago. For example, the agreement stipulates that the sides will pass a two-year budget law that will carry the coalition without any destabilizing budget fights through the end of 2021 — when Gantz will, according to the deal, be seated as prime minister. Netanyahu now insists on a one-year budget just for 2020, giving him an escape clause from the agreement in the form of the toppling of the government should a separate 2021 budget fail to pass by March. That’s not his stated reason for the change, of course. He claims the uncertainties engendered by the pandemic make it impossible to put together a 2021 budget at this stage.
Netanyahu’s case that a one-year budget makes for better policy seemed believable last month. Finance Ministry and Bank of Israel officials all backed the idea. But as the weeks have passed, it has become increasingly clear that their support came not because they believed it was better policy, but because they believed Netanyahu was capable of going to new elections without passing any budget at all — and no budget could be disastrous for the country. The current 2020 budget is running on 2019 numbers, since that is the last budget framework approved by the Knesset. That means the roughly NIS 400 billion ($117 billion) budget is about NIS 15 billion ($4.4 billion) short of spending needs, and that is without the enormous sums the pandemic has already cost, with stimulus spending, compensation for lost wages and shuttered businesses, and lost tax revenues.
It is one thing to have a short-term deficit, even an enormous one, to cope with a once-in-a-century pandemic, the government’s Accountant General Roni Hizkiyahu has argued, according to accounts in Israeli business journals. It is quite another to have the government prove itself politically incapable of handling its pandemic spending in organized budget laws. International creditors and lending agencies may forgive the former, but they will draw dire conclusions about Israel’s future prospects from the latter.
At the direction of Finance Minister Israel Katz, the treasury’s Budgets Department only drafted a one-year budget, in an act of political strong-arming that forces Gantz to choose between approving the budget Netanyahu wants — and which gives Netanyahu a March exit ramp without Gantz becoming prime minister — or forcing the country to wait additional weeks until a two-year budget can be produced.
In other words, Netanyahu violated a key plank of his coalition agreement with Gantz for political reasons, not at the behest of finance officials. In the views of Hizkiyahu and others, Netanyahu is effectively holding the nation’s economy hostage, believing Gantz will either acquiesce to a one-year budget in order to prevent further damage to Israel’s economy or will hold his ground. Either way, Netanyahu has his excuse to call early elections.
There have been other violations of the agreement, such as Netanyahu’s continuing refusal to bring the cabinet procedures stipulated in the deal to a cabinet vote — the procedures that ensure that any cabinet vote must have both sides’ agreement before moving forward. But such violations pale in comparison to Netanyahu’s budget pivot and the standoff it has sparked. If Netanyahu’s reasons for his one-year budget demand is anything less than purely substantive — and he has offered no serious argument for refusing to pass a 2021 budget as agreed — then he is playing a political game with a fragile, crisis-battered economy.
An unexpected crisis
It must be said: Benny Gantz did not believe Netanyahu would stick to his word. He said at the signing of the agreement in May and continues to insist today that he ended the year-long three-election deadlock because he believed it was good for the country, believed the pandemic had changed everything, and, as he put it, “If it turns out I’d been a sucker” for trusting Netanyahu, “then that’s okay.”
But Gantz had good reason to believe Netanyahu would not try to topple the government at this point.
The prime minister is doing well in the polls, but not quite well enough to make another election risk-free.
A Channel 13 poll late last week, reflecting most polls in recent days, gave Netanyahu’s Likud party 29 seats, down 11 seats from a month earlier. Right-wing Yamina, which has a love-hate relationship with Netanyahu befitting a soap opera, saw one of its strongest showings in any poll yet: 19 seats, marking a surge in support for a party that won just six seats in the March race. All told, the right-Haredi bloc that Netanyahu needs to win the next race took 63 seats in that poll — a clear win if the numbers bear out on election day, and a terrible gamble from the vantage point of three months beforehand.
Then, too, there’s the fact that simple arithmetic points to Yamina drawing some of its newfound support from centrist voters; if it rejoins Likud to run as a right-wing “bloc,” as it did in the last couple of races, it is likely to shed those supporters, and with it the right’s slim majority.
Does it make sense for Netanyahu to be pushing for elections when a win is so uncertain?
Perhaps, then, he is not pushing for new elections at all, but for an easier escape from his unity strait-jacket. Perhaps he is trying to terrify small factions in Gantz’s Blue and White alliance, such as the two-man Derech Eretz faction or the two cabinet ministers from Labor, with the prospect of an election in order to get them to abandon Gantz and join a right-wing government without new elections. Both factions would be erased at the ballot box, according to every poll conducted since the government’s formation. Politicians staring into such oblivion, Netanyahu may have reasoned, might become amenable to jumping ship.
Derech Eretz’s Yoaz Hendel, the communications minister, publicly confirmed he had been approached about such a move, saying, “They’ve offered me everything” to abandon Gantz.
Press reports over the weekend claimed that two Blue and White ministers, Pnina Tamano-Shata and Omer Yankelevich, had each met personally with Netanyahu in the past week. It was a strange leak, denied afterward by both ministers, that appeared to come from Likud.
If Netanyahu was really trying to pull MKs away from Gantz, why would he do it in ways so obviously intended to become public, where they would embarrass the MKs involved and only make it harder to actually peel them away from Gantz?
Then there are the ultra-Orthodox parties, who have grown angry at Netanyahu’s political games.
Shas and United Torah Judaism are desperate to pass a state budget. Haredi educational institutions are grappling with a shortfall of hundreds of millions of shekels because no state budget law has passed for a fiscal year already two-thirds gone. A new election would delay things not only until election day in November, but until the next Knesset selects a prime minister, who then negotiates a coalition, swears in a government and successfully drafts and passes a state budget law. Even if the new election ends with a successful and clear victory, unlike the last three, it would be March or April at the earliest before a budget is passed, with Israel’s yeshivas hemorrhaging money and losing students all the while.
Last week, pundits believed they had finally found the smoking gun of Netanyahu’s intentions: he offered the ultra-Orthodox parties to funnel hundreds of millions of shekels to yeshivas in a separate measure outside the framework of the state budget.
Up till now, the Haredim have been Gantz’s most ardent defenders against Netanyahu’s machinations, if only to avoid new elections and force both sides to compromise on the budget.
But freed from their dependence on the state budget, Netanyahu apparently calculated, the Haredi parties would have the political breathing room to join him in breaking up the government.
There’s just one problem: it all sounds clever enough in theory, but is impossible in practice. Netanyahu probably does not have the votes in the Knesset to transfer vast sums to Haredi institutions without a budget law. Why would Gantz’s Blue and White vote to weaken its own hand? Why would the Arab Joint List or secularist Yisrael Beytenu or Yesh Atid support the move? Or left-wing Meretz? Or right-wing (but in the opposition and not exactly pro-Haredi) Yamina?
Netanyahu was playing with the Haredi parties, just as he played with Derech Eretz and ministers Yankelevich and Tamano-Shata.
The Haredi parties need a budget bill, as he well knows; he also understands that their base has come to see Netanyahu as their camp’s leader. Shas voters overwhelmingly prefer Netanyahu to Gantz, so Shas leader Aryeh Deri’s leverage over Netanyahu — especially, ironically, if a new election is in the offing — is exceedingly limited. Moreover, Haredi institutions could not endure a term in the opposition. The Haredi parties cannot risk abandoning Netanyahu and having secularist Yisrael Beytenu and religious-Zionist Yamina take their place and vote down the state funds on which they depend.
Haredi politicians feel angry, trapped, and slightly abused by the prime minister.
Back from the brink
Then there is the strange fact that, at every point where an election would have been inevitable as the crisis developed over the last couple of weeks, Netanyahu pulled back from the brink.
Last Wednesday, Yamina proposed a bill to legislate a so-called “supersession clause,” the long-sought right-wing dream of a law that allows the Knesset to vote to override a High Court of Justice decision. Many Likud lawmakers pronounced their support for the bill, but then received the order to kill it.
Likud’s faction chair, MK Miki Zohar, explained ahead of the vote that, to his regret — “I’m sad to say that my view was not adopted” — Likud would not vote on the bill, but would be absent from the plenum.
The decision, Zohar said bluntly, came “after discussions and clarifications revealed that a vote for the bill would have brought on elections with absolute certainty,” he said.
The Haredim were also absent, not for love of the High Court, but out of a desperate need for political stability and the passage of a state budget.
Yet they needn’t have bothered. The supersession bill was voted down 71 to 5. That is, it would not have passed even if the entire right-wing had stood its ground and voted in favor. Indeed, many right-wing MKs would later confide to reporters that they were happy to be absent because they, too, opposed the measure.
It is safe to assume, in other words, that the bill would not have “brought on elections with absolute certainty,” as Zohar claimed, for the simple reason that it could not have passed.
Likud’s grand gesture of seeming to take Blue and White’s feelings into account had a more tactical motive: another vote was on the agenda on Wednesday, Yesh Atid’s proposal to establish a parliamentary investigation into the so-called “submarine affair,” a corruption probe in which Netanyahu is not a suspect, but which has ensnared some of his top confidants. After Likud walked out on the supersession bill, Blue and White were absent for the submarine affair vote.
Tellingly, that same day Gantz met with Haredi lawmakers and promised to support a version of the military draft law that they preferred, one which would exclude the vast majority of ultra-Orthodox youth from military service — “but only if the government survives.”
To Netanyahu’s offer of cash, Gantz had responded with the offer of sorting out once and for all the question of the Haredi draft.
On Thursday, the Haredi parties sent a letter to Netanyahu and Gantz that demanded an end to such games. “We won’t cooperate with any attempt to bring on early elections, and we will do anything it takes to prevent elections,” they wrote.
Netanyahu’s closest partners do not want an election. Netanyahu risks another deadlocked race if he forces the point. Likud will certainly shrink and the right-wing bloc, frayed and battered by a falling out with a surging Yamina, is within the margin of error of another failure to form a coalition. The current government was formed because Netanyahu convinced Gantz that the coronavirus emergency justified setting aside political interests and rallying to the flag at the country’s moment of need. But his treatment of Gantz since the new government was formed ensures there won’t be another candidate after the November race who will similarly put the virus emergency ahead of their own political interests, since no one will believe Netanyahu would be doing the same. (In the minds of politicians, of course, there’s no difference between the public interest and their political interests; that belief is nigh a precondition for successful politicking.)
Netanyahu is still at the top of the heap, but his options are dwindling, largely because of his own behavior.
It was in that state, as he repeatedly pushed the political system right up to the edge but took great care not to let it fall over, that Netanyahu ushered in the new week on Sunday — and showed that the political standoff is unlikely to end soon, even if it exacts terrible costs from the Israeli economy and a suffering public.
On Sunday morning, Likud minister David Amsalem informed Blue and White’s Avi Nissenkorn, the justice minister, that he was canceling the scheduled meeting of the cabinet’s legislation committee over the tensions — and, without intending it, freezing a bill meant to ensure that couples whose weddings were canceled because of the virus can get their advances returned.
It is not just those couples who are turning into collateral damage in the Netanyahu-Gantz standoff. The state budget bill as a whole is not moving forward — a fact that has sparked growing consternation in the Finance Ministry over the possibility that Israel’s credit rating could suffer, led several senior treasury officials, including the accountant general and the deputy budgets head, to announce their resignations, and drawn a rare rebuke from the governor of the Bank of Israel.
The new normal
On Sunday night, Derech Eretz announced that it had found a solution to the budget problem: kick the can down the road by passing a law that delays the August 25 budget deadline by 100 days — till December 3, to be exact — and gives Netanyahu and Gantz time to work things out.
Netanyahu, the party said, “has acquiesced” to the idea. So had Gantz. With their support, the bill does not need the standard two-week “tabling” period, and can come up for the first of four plenum votes as early as Wednesday.
Is Netanyahu now looking to avoid an election?
Even some of the prime minister’s supporters could not help but notice that the vote to stave off elections will arrive in the plenum on the same day as another little bill, proposed by Yesh Atid, that would prohibit someone with outstanding criminal indictments from running for prime minister — a bill Gantz would have supported if the coalition had just fallen apart.
Welcome to the new normal, to Netanyahu’s permanent campaign of destabilization.
Over the past two weeks, Netanyahu has delivered fiery speeches in the Knesset about “anarchists” and leftist conspiracies, visited Likud activists and falafel vendors around the country, launched his election campaign’s Facebook bot that informs followers through automated chats about campaign activities, and — most dramatically — paid thousands of shekels to nearly every Israeli family in a rushed “stimulus” gift that cost some NIS 6 billion in deficit spending and was criticized even by the Finance Ministry.
Yet none of that means he’s plunging headlong to an election. Even if one could read his mind, that would probably not resolve the conundrum of his intentions. That’s because Netanyahu himself isn’t locked on any one direction. He is preparing for elections, but not because he’s eager for economically devastated Israelis, facing 21% unemployment and the fastest-shrinking economy in the country’s history, to head to the ballot box in the fall. He is not chasing an election, but rather dangling the threat of one over the political system in order to demoralize Gantz, maintain his grip on the loyalty of the Haredi parties, and generally attempt to convince the rest of the political system that he is the crazy variable in their political calculations, the opponent capable of toppling everything in one fell swoop if his demands are not met — the economic fallout be damned.
It’s a classic “hold me back” strategy. And to be convincing, sometimes you have to be willing to make good on the threat.