Two years after returning to power, Prime Minister Benjamin Netanyahu is enmeshed in a web of onerous constraints and seeking a way out. Polls show his popularity plunging, and his Likud party's brand has been squeezed between Kadima and Yisrael Beiteinu.
Kadima chairwoman Tzipi Livni is firmly ensconced in the political center, Yisrael Beiteinu chairman Avigdor Lieberman is threatening to dismantle the coalition from the right, and Netanyahu is being worn down between them, with no agenda and no hope. The quiet on the security front and the economic growth have not translated into public affection; rather, they have brought apathy and a sense of being tired of this government.
Externally, international pressure is closing him in ever more tightly. Netanyahu extracted a veto from U.S. President Barack Obama of a UN Security Council resolution condemning the settlements, but that merely highlighted Israel's isolation.
"The world" is united in its belief that Israel is clinging to the status quo, and is demanding that it abandon the occupation and the settlements as its contribution to the new regional order. Netanyahu's warnings that the revolutions in Arab states will strengthen Iran and radical Islam - and that therefore, the wise course is to hunker down and wait - have been either ignored or rejected by a West enthralled by the miracle of "Arab democracy."
The Palestinians are approaching "White September," in which they will declare independence - and if they meet with an Israeli rejection, begin an Egypt-style popular uprising. The conditions that led to the uprising in Cairo's Tahrir Square also exist in East Jerusalem: masses of young people with no hope, but exposed to the temptations of globalization and the Internet. If they march in their thousands toward the Old City, Israel will not be able to stop them. Netanyahu won't massacre demonstrators as Libya's Muammar Gadhafi has.
Iran is continuing its nuclear program undetered, though stopping this program topped Netanyahu's priority list. International sanctions, never very effective, have collapsed entirely due to the soaring price of oil.
Computer worms damaged Iran's centrifuges, but didn't halt them. Spring is drawing near, and with it a fleeting "window of opportunity" for a military strike.
So what should he do? Defense Minister Ehud Barak has proposed a two-pronged strategy to Netanyahu: a diplomatic initiative to the Palestinians and a preventive strike on Iran. Give the world the settlement of Yitzhar and secure legitimacy to bomb Natanz.
Ministers Lieberman and Moshe Ya'alon propose advancing an interim arrangement in the West Bank and skipping the attack on Iran. In Ya'alon's view, upgrading the Palestinian Authority to a state in its existing borders would eliminate all the Palestinian threats against Israel.
As head of a recognized state, Mahmoud Abbas would have trouble threatening to overrun Israel demographically, to abolish the PA and restore military rule, or to push for a binational state. This view posits that if it's possible to give the Palestinians a state without ceding another millimeter of territory, Israel can only benefit.
Netanyahu has been examining the idea of a Palestinian state in provisional borders for several months now. His advisors are divided: Zvi Hauser is in favor, Ron Dermer is opposed. It's hard to find a formula will be generous enough to satisfy the international community without causing the break-up of Likud.
Kadima MK Shaul Mofaz's plan for a gradual agreement seems like a reasonable formula, one tailor-made for Israel's political center. But the right would have trouble swallowing it, because it promises the Palestinians that they will ultimately receive a state equivalent in size to the West Bank and the Gaza Strip.
Netanyahu is still debating, but meanwhile, he's breaking toward the center via the tried-and-true method he learned from former Prime Minister Ariel Sharon: a confrontation with the settlers over the evacuation of illegal outposts.
Even his excuse is familiar: "We're in a very difficult international situation; I won't bury my head in the sand," as he told the Likud faction meeting on Monday. In his speech to the Knesset last week, Netanyahu hinted at an interim agreement in which Israel would retain the Jordan Valley and postpone its demand for Palestinian recognition of it as "the state of the Jewish people" until a later date.
Netanyahu's problem is not that he lacks diplomatic formulas, but that he lacks credibility in the eyes of world leaders. He will have to throw them a juicy bone in order for them to back him and refrain from supporting a Palestinian uprising. But then he will risk losing his rightist coalition, and with it, his job - just as he did after signing the Wye River Memorandum during his first term as prime minister.
Now, he is facing the gamble of his life: Should he surprise everyone with his "Bar-Ilan University Speech, Version 2.0," in the hope that his plunge in the polls will reverse and the world will cut him some slack? Or will he understand that it's a lost cause, and his term of office will simply fade away as if it never was?
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