VZCZCXRO5550
PP RUEHROV
DE RUEHTV #0675/01 0791435
ZNR UUUUU ZZH
P 201435Z MAR 09
FM AMEMBASSY TEL AVIV
TO RUEHC/SECSTATE WASHDC PRIORITY 1088
INFO RUEHXK/ARAB ISRAELI COLLECTIVE PRIORITY
RHEHNSC/NSC WASHDC PRIORITY

UNCLAS SECTION 01 OF 02 TEL AVIV 000675 
 
SENSITIVE 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PREL PGOV IS
SUBJECT: NETANYAHU REQUESTS EXTENSION IN EFFORT TO BRING 
LABOR INTO COALITION 
 
REF: A. TEL AVIV 646 
     ¶B. TEL AVIV 580 
 
¶1.  (SBU) SUMMARY.  On March 20 President Shimon Peres 
granted Prime Minister-Designate Binyamin Netanyahu's request 
for a 14-day extension to form a coalition.  Netanyahu's 
request stemmed from the agreement he reached the evening of 
March 18 with Labor party chief and Defense Minister Ehud 
Barak to join his government.  The extra time allows Barak an 
opportunity to have his party approve the plan to partner 
with Netanyahu, but Barak faces strong internal opposition. 
Netanyahu also has not given up hope on Kadima, and his party 
has leaked details of what he has offered to entice that 
party to join.  If Labor (or Kadima) joins the coalition it 
would help Netanyahu take office with a more balanced 
government, but it also would leave Likud party stalwarts 
with few and relatively junior ministerial posts, which could 
prompt intra-party squabbling.  End Summary. 
 
--------------------------------- 
POTENTIAL PACT WITH LABOR COMPELS 
NETANYAHU TO REQUEST AN EXTENSION 
--------------------------------- 
 
¶2.  (U) Netanyahu on March 20 requested and received from 
President Shimon Peres a 14-day extension of the deadline 
(now April 5) to secure a governing majority.  Netanyahu in 
the past few days appears to have reached an agreement with 
Labor Chairman Barak to bring Barak's faction into the new 
government.  Even before the election, Netanyahu had 
indicated that he wanted to form a unity government and keep 
Barak as Defense Minister.  Barak, however, must first gain 
approval from his party, which is scheduled to formally 
consider the proposal on March 24.  A vocal group of leftwing 
Labor MKs has voiced strong opposition to joining the 
government, and is attempting to form a blocking majority 
while also looking for procedural roadblocks that would delay 
the meeting until after Netanyahu's extension expires.  Labor 
MKs opposed to joining the government argue that the party's 
path toward re-gaining relevance lies in serving in the 
opposition.  Barak has countered that Israel faces critical 
issues and that the party can serve the nation better from 
inside the government.  Also, Labor would gain nothing by 
playing second-fiddle to Kadima in the opposition.  A poll 
recently conducted by the Panorama Marketing Institute in 
Israel showed that more than 60% of Labor party voters 
support their party joining the government. 
 
¶3.  (SBU) Likud and Labor officials think their talks will 
put pressure on Kadima to join a broad-based coalition.  Two 
Kadima MK's close to party chief Tzipi Livni told poloffs on 
March 19, however, that their party is destined for the 
opposition following the failure of Livni and Netanyahu to 
come to terms.  The Likud Party leaked to the press details 
regarding what Netanyahu offered Livni (including keeping the 
foreign ministry portfolio and leading negotiations with the 
Palestinians) as another means of public pressure, but, for 
now, Livni remains adamantly opposed. 
 
--------------------------------- 
POTENTIAL IMPACT ON THE RIGHTWING 
--------------------------------- 
 
¶4.  (SBU) A Likud political advisor told poloff March 19 that 
he anticipated a deal with Labor would alienate the rightwing 
National Union Party, but that party would not be necessary 
to form a coalition.  He affirmed that discussions with the 
two ultraorthodox parties (SHAS and UTJ) continued and did 
not foresee major obstacles to their joining the coalition. 
The new "Jewish Home" party was also likely to join, but its 
three Knesset members are at odds with each other over 
political spoils rather than ideological positions. 
 
-------------------------- 
ANY SLOTS LEFT FOR LIKUD? 
-------------------------- 
 
¶5.  (U) Netanyahu's decision to offer Barak the defense 
portfolio means that if Labor goes along then none of the 
senior ministries will go to the incoming premier's party 
colleagues (Note:  Netanyahu appears ready to maintain the 
finance slot for himself -- for the moment, at least -- and 
has already agreed to give the foreign affairs post to 
Yisrael Beitenu head Avigdor Lieberman.  End Note.).  The 
Likud leader has managed to keep a lid on any internal strife 
as he conducted coalition negotiations, but he will face a 
test of party unity when deciding which post to offer Silvan 
Shalom, who has been the most vocal in complaining about 
portfolio distribution. 
 
 
TEL AVIV 00000675  002 OF 002 
 
 
¶6.  (SBU) COMMENT:  We do not view Netanyahu's request for an 
extension as an indication that he will be unable to form a 
government.  He genuinely wants a broad-based coalition, but 
if he fails to lure Labor (or Kadima) he still has a narrow 
rightwing and ultraorthodox bloc of parties that he could 
present to the Knesset early next month.  Even if Barak 
prevails in his bid to gain party backing to join the 
government, his party may fracture, as some Labor MKs seem 
adamant about opposing Netanyahu's government.  End Comment. 
 
********************************************* ******************** 
Visit Embassy Tel Aviv's Classified Website: 
http://www.state.sgov.gov/p/nea/telaviv 
********************************************* ******************** 
CUNNINGHAM