Israel Week Ending May 7th

Last Shabbat in Balfour? Unrest in Jerusalem, Covid Under Control

These could be the last days of Benjamin Netanyahu’s Prime Ministership. On Wednesday, President Rivlin officially granted the mandate to try to form a government to Yair Lapid. This transpired after Netanyahu failed to form a coalition. Netanyahu’s failure came down to what I wrote the week after the election — i.e. Netanyahu, courted both the Islamic Front, led by Mansour Abbas, as well as, the Religious Zionists, headed by Bezalel Smotritch, and in order to reach 61 votes, he needed both … and that was never going to happen. Smotritch is very happy to sit in the opposition and position himself as the steadfast leader of the right-wing.  

Now it's up to Yair Lapid, Gideon Saar, and the others in the “Coalition for Change” to agree on a recipe/blueprint to form a government. For the last four weeks, Naftali Bennett has publicly played footsie with the prospect of joining the “Coalition for Change.” Bennett maintains his preference a right-wing government, but, understands the math, and knows how important it is to remove Netanyahu from the premiership. 

To keep his base happy, he went along with Netanyahu until the Prime Minister ran out of time to cobble together a coalition. Once that happened, Bennett made clear he would do all he could to set up a government of national reconciliation, and of course, avoid a fifth election within two years. The significant pieces of the alternative coalition agreement have been in place for days. Bennett will become Prime Minister for the first two years, while Yair Lapid serves as Foreign Minister, and then they will switch. Gantz will remain Defense Minister, while Avigdor Lieberman becomes Finance Minister. The position of Justice Minister will be given to Gideon Sa’ar. 

There are questions as to what portfolios Merav Michaeli and Nitzan Hurwitz will receive. Michaeli will either be given Interior Ministry or Infrastructure, which includes Transportation. There is a very high likelihood that an agreement can be signed this coming week. This will not be a government that undertakes any bold moves, but rather, a government that returns a level of sanity and non-partisanship to Israeli governance. It will allow cleansing of the government and a return to norms, all of which both Lapid and Bennett understand. 

If a Palestinian “Sadat” suddenly appears, the alternative government might fall apart. However, with Biden in the White House limiting Israeli actions on the right, and the Palestinians split between Hamas and the Palestinian Authority limiting any peace initiatives on the left, chances of a political crisis surrounding the Palestinians is small. The other significant change in this new potential coalition is that it will be the first government without either Haredim or Netanyahu in 40 years. Maybe at long last, there might be a thoughtful approach to meet the challenges posed by the expanding Haredi community.

In the coming days, Netanyahu and his representatives will do all they can to stop the alternative government from forming. Their main line of attack is on Naftali Bennett and members of his right-wing Yemina Party, attacking them for planning to join a “left-wing government.” Of course, like most things Netanyahu the politician, says, this characterization is far from accurate. The new government will have just two parties considered left-wing — Meretz and Avodah; two centrist parties: Yesh Atid and Blue and White; and three right-wing parties Yemina, Tikvah Chadasha, and Yisrael Beyteinu. 

So far, there has been one, rather strange, defection from Yemina. MK Amichai Chikli, who lives of Kibbutz Hanaton, the only Conservative (Masorti) Kibbutz in the country. Chikli has stated he would vote against the government, but every other member of Bennett's Party has come out in support of his decision to join the new government. 

As the saying goes, it's not over until the fat lady sings — but it looks likely this might be the last Shabbat for the Netanyahu family in the Prime Minister’s Residence on Balfour.

Defense

There have been several terror attacks this past week. Early in the week, a Yeshiva student was killed at the Tapuach junction. This morning, terrorists opened fire on an army base, where two were killed, and a third severely wounded. Many things could be driving this latest terror wave, including the called-off Palestinian elections. 

However, recent events in Jerusalem are sure to be one of the causes. The story in Jerusalem is about a multi-year effort by right-wing Israelis to reclaim real estate that had been in Jewish hands during the British Mandatory period, in the presently overwhelmingly Arab Sheikh Jarrah neighborhood of East Jerusalem. Courts have ruled in favor of the former Jewish owner, and now they are trying to evict the residents who have lived in these homes for 70 years. This action might be acceptable if there was a way for Arabs who fled West Jerusalem to get back their property, a move Israeli law does not permit. Moreover, even if the former Jewish owners are correct, sometimes it's more important to be smart, than right. Any dispute over Jerusalem is the one issue that can inflame tensions between us and the Arab States. Support the settlers who are trying to take over the Palestinian home continue to receive from MK Ben Gvir, (who publicly supports the transfers of the Arabs), has further inflamed matters. There have been daily clashes. Hopefully, the new government will calm down this matter.

Meron Tragedy

It has been over a week since the tragedy, and to date, there has been no serious inquiry into the causes. The current government is not interested in creating a commission of inquiry. The State Comptroller has said he would investigate. However, no one trusts him. The most influential Ashkenazi Charedi Rabbi, Rabbi Kanievsky, has called on women to be more modest, in order to avoid future disasters. In the same vein, the Chief Sephardi Rabbi, and other Sephardic Rabbis have blamed the tragedy on the use of non-kosher phones, and people who have internet connections at home. There is hope the next government will support the creation of a commission of inquiry to investigate one of the worst civilian accidents in Israel's history.

Covid–19

The situation continues to be excellent. Yesterday, there were 48 new cases in Israel, with a large number imported via people from abroad. The positive rate of testing is .2%, and the number of seriously ill patients has decreased to 85. There are now effectively no restrictions, other than the requirement to wear masks when in indoor public places.

Economy

The high-tech sector continues to sizzle, as funding rounds and exits continue. This past week, it was announced that Agtech startup Prospera will be acquired by American Valmont for $300 million. Prospera utilizes AI to plan a farmer's crop management. Meanwhile, Simplex, a Crypto startup, is poised to be acquired for $200-250 million. It was also reported that monday.com has filed with the SEC to go public. Estimates suggest that monday.com will go public at a valuation of $2.7 billion. More and more Israeli companies have been going the public route, instead of selling for a lower valuation earlier in the process. The hot market for Israeli companies has undoubtedly helped that trend.

Finally, on a more prosaic note, Waze reports there are between 8%—15% more cars on our roads than before the pandemic. The problem is that Israel’s roads could not handle the previous load. Traffic in and out of the Tel Aviv area is atrocious, with no signs of improvement. Happily, since I get everywhere I need to go by foot, or by scooter, this does not pose a problem for me. Tel Aviv is rapidly building bike lanes everywhere, although the city seems to have a bit of a schizophrenic relationship with the scooter companies. The city wholeheartedly encourages scooter companies to operate, then sends out city workers to impound any scooters that don't fit in the neat rectangles painted for scooter parking. The city employees, of course, show absolutely no consideration for the valuable property they have impounded. It is Mayor Huldai’s goal to make Tel Aviv car-free in 20 years. Conceivably, that could happen, but it will require a considerably more thoughtful approach.