Netanyahu hopes for better luck as Israel votes for third time in a year

File image of Israel Prime Minister Benjamin Netanyahu | Photo: Kobi Wolf | Bloomberg

Jerusalem: Benjamin Netanyahu and Benny Gantz headed to their third match-up in less than a year, as Israelis burdened by election fatigue and political paralysis looked grimly at polls forecasting another deadlock.

Netanyahu’s prospects appeared to improve, however, as he went into the last stretch ahead of Monday’s race.

A year of political paralysis hasn’t dented Israel’s economy, which expanded at an unexpectedly faster clip of 3.5% last year on consumer spending and a booming technology sector. There’s concern, though, that continued stalemate will alienate investors and delay reforms to the ailing health, education and infrastructure systems.

If no government is formed after the vote, Israel’s credit rating may suffer, Bank Hapoalim Ltd. said in a report Sunday.

Netanyahu, indicted in three graft cases, has been gambling on successive revotes to win a majority in parliament and possibly keep himself out of jail. Two major developments have rippled through the body politic since Israelis last cast ballots in September.

The once all-powerful Israeli prime minister watched corruption suspicions ripen into indictments and a March 17 trial date. And far away in Washington, the Trump administration reshuffled the Middle East deck with a peace plan that would allow Israel to unilaterally annex large chunks of the West Bank, in a harsh blow to the Palestinians’ statehood aspirations.

While these moves could have far-reaching implications, polls suggest they haven’t tilted the contest toward a clearcut verdict.

Netanyahu built momentum in the last two weeks of the campaign, and his Likud party overtook Gantz’s Blue and White in polls after consistently trailing before. Yet he and his religious and nationalist allies still fell short of a parliamentary majority. The last surveys gave the prime minister’s camp as many as 59 of parliament’s 120 seats, while the rival bloc led by former military chief Gantz would win up to 57.

If the polls are borne out, then the fulcrum would shift to coalition negotiations that didn’t end the impasse in the previous two rounds of voting.

 

Many Scenarios

The surveys’ margin of error makes a Netanyahu victory realistic, but if he can’t scrape together a 61-seat majority, a variety of options could ensue, said Abraham Diskin, an emeritus professor of political science at Hebrew University in Jerusalem.

“There could be a rebellion in both camps” against their leaders, Diskin said. “You could have a minority government. You could have a unity government. And there could be another election.”

In a sign of the times, isolated voting stations were put up in parking lots to accommodate the roughly 5,600 Israelis under house quarantine after being exposed to coronavirus. Election workers and voters at these stations will operate in separate tents with transparent panels that will allow the workers to supervise voting. Voters will be asked to don masks and gloves, and put their identifying papers in plastic bags to lessen the risk of infection.

The absence of a fully functioning government since December 2018 has put off decisive action on many fronts as security, political and diplomatic challenges mount. Confrontations with Iran-backed militants on the country’s northern and southern frontiers have flared sporadically, and while the economy has been robust, risks are piling up.

Israel remains without a permanent budget, a predicament the central bank has warned could have a contractionary effect on the economy. Bank Hapoalim Ltd. has warned that the country might be slapped with an unprecedented downgrade of its credit rating should the election fail to produce a government that could pass a new budget. And Deutsche Bank AG noted that it’s the only country that’s “uniformly exposed to risks emanating from China, the euro area and the U.S.”

“The first priority of the new government, when formed, will be to draft a
budget for 2020, assuring markets, as well as credit rating agencies, of a
planned consolidation ahead,” Deutsche Bank analysts including Kubilay Ozturk
said in a report.

Netanyahu, Israel’s longest-serving leader, called the first elections for April 2019 as the prosecutor’s office weighed whether to indict him on bribery and fraud charges. He was unable to form a government after former Defense Minister Avigdor Liberman unexpectedly refused to join his coalition, and rather than give anyone else a chance to become prime minister, Netanyahu engineered a September revote that delivered another inconclusive result.

Before the election season degenerated into a yearlong affair, the prime minister was trying to push through legislation that would shield an incumbent leader from prosecution, and that effort could resume if he wins a fifth term.

Netanyahu is accused of illicitly taking about $290,000 worth of cigars and champagne from wealthy friends and of scheming to help media moguls in exchange for sympathetic coverage. The prime minister and his backers claim he’s the victim of a politically motivated witch-hunt by opponents who deplore his nationalist agenda. He’s the first sitting Israeli leader to face criminal charges.

It was this taint of corruption that allowed political newcomer Gantz to mount the most serious challenge to Netanyahu since he was defeated after his first term by another former military chief, Ehud Barak, in 1999.

Gantz didn’t enter politics until December 2018, and wasn’t one of the country’s storied generals. His political bloc is a mishmash of Netanyahu opponents from across the political spectrum. But his clean-hands image and security credentials were enough to attract a large following among many desperate to replace the prime minister.

Netanyahu had hoped that the Trump peace plan, which goes far further than previous proposals to accommodate Israel’s demands, would give his camp the boost it needed to finally vanquish Gantz.

When polls showed it did not, he pivoted to the economy, which hadn’t been an issue in previous campaigns given solid growth, promising to bring down high food and housing prices. And he appealed to supporters weary of back-to-back elections to go to the polls to help him recoup votes lost in the September election, as he sprinted across the country in the final days of the campaign, insinuating that Gantz was unstable. As he did so, polls showed Likud slightly surpassing Blue and White, but not in a decisive way.

“It looks pretty much like the same outcome” as before, said Professor Gideon Rahat of the political science department at Hebrew University. –Bloomberg