Vice Prime Minister and Strategic Affairs Minister Moshe Ya'alon, a former chief of staff, was brought into the party by Benjamin Netanyahu in 2009 to beef up its military credentials. His roots are in Labor Party precursor Mapai and he supported the Oslo Accords until becoming, he says, "disillusioned." He took part in the consultations with the prime minister before Netanyahu flew to Washington last week, and has stood by Netanyahu since the premier's harsh response to President Barack Obama's speech and the subsequent confrontation with the Americans.

You are one of the cabinet ministers with the greatest military and foreign-policy experience. Don't you fear the implications of a confrontation between Netanyahu and Obama?

"There is no doubt that relations with the United States have always been important, especially at this time. But differences of opinion have developed on the Palestinian issue in light of Obama's speech. The president divided the process into two phases; the worst part is that, according to the order set by President Obama, we first have to give up all the territory and return to the 1967 lines. This is a new and precedent-setting statement. This order of affairs is first and foremost suited to the Palestinians' interests. That is why it is good that the prime minister made it clear that those borders are not defensible. In his speech, Obama in effect demanded of us to give up the territorial card without the substantive questions that are important to us - such as recognition of the State of Israel as the nation state of the Jewish people - are solved."

How surprised were you by Netanyahu's toughness? Did he consult with you?

"It didn't surprise me. The prime minister knows the reality well and he conducted himself with courage and in the correct manner. There was a series of consultations between us in the past few weeks, both one-on-one and in the security cabinet, and the prime minister's steadfast stand is the fruit of these consultations. I was not surprised by Netanyahu but the speech by President Obama surprised me. Until Wednesday we were led to believe in the framework of the preliminary talks with the Americans that the Israeli-Palestinian issue would not come up in Obama's speech on Thursday."

Do you think that Obama's speech caused damage to the renewal of negotiations with the Palestinians?

"There are a number of components that must be put on the table clearly here, and the speech blurs them to a large extent. There is no doubt that there is a political and diplomatic earthquake taking place in the Arab states and perhaps also Iran, and what is clear is that it is not tied to the Israeli-Palestinian conflict. Obama's speech is negative in this context because it brings back the claim that there is a connection.

"In addition, one of our arguments over the past two years has been that we are ready to begin direct negotiations with the Palestinians, while the speech doesn't encourage the resumption of negotiations. Someone who wishes to prevent the option of a unilateral declaration of a Palestinian state in September should not have presented the matter in such a way, and I very much hope that it will be possible to correct this. After all, in the final analysis, these are interests that we share with the United States."

Can you explain why Obama took such a position in the end?

"I don't wish to analyze this in public but I have thoughts on the subject, and the very fact that there were different understandings with the rest of his staff speaks for itself."

The chairman of the Knesset's Foreign Affairs and Defense Committee, Shaul Mofaz, a former chief of staff and defense minister, warns that Netanyahu's conduct will lead to a violent confrontation with the Palestinians. Will this be the worst we have experienced?

"We are in a state of emergency in terms of relations with the Palestinians, and I regret that there are elements for whom political considerations are more important than national ones. The impression has been created that we are negotiating among ourselves while we don't have a partner on the other side, while they are continuing to educate the young generation to deny the attachment between the Jewish people and this land, and that is being done by Abu Mazen [Palestinian Authority President Mahmoud Abbas], the moderate, and not by Hamas. So it is quite clear to anyone with eyes in his head that we don't have a partner to the vision of two states for two peoples."

So, does Netanyahu have a plan?

"We have a plan we drew up at the beginning of Netanyahu's term, and it found expression in the Bar-Ilan speech. It includes the declaration that we don't wish to rule over the Palestinians. In actual fact, we already do not control them - in Gaza they have Hamastan and we are prepared for negotiations without any prior conditions with Abu Mazen in Ramallah. Our question to the Palestinians is, are you ready for a final-status agreement that includes recognition of the right of the State of Israel to exist as a nation-state of the Jewish people? The second question is, what territorial arrangement would you consider as a final-status agreement? Then they come to us and say, wait a moment, there's the refugee committee, and until the last of the refugees is satisfied there won't be a solution to the conflict."

"In addition, we saw that they have no intention of providing a response to our security needs and that is after the bitter experience that we have with the territories we gave up and from which terror emerges. "Therefore this conflict is not over territory or the 1967 borders, because after all they're talking about 1948 and looking at Haifa, Acre, Jaffa and the Galilee. In that case, we have to hold firm until they understand."

Even at the price of a third intifada?

"There are situations where we have to make our position crystal-clear, and from my experience, especially when one doesn't exaggerate, the other side will understand us. As I know Abu Mazen, to my regret he wants to avoid any decisive point. He is afraid to confront Hamas and it is convenient for him in this position so that, from his point of view, the main thing is to get home safely, that is, to survive."

According to this analysis, it is impossible to progress with Abbas.

"Yes. There's not a minister in the security cabinet who believes it's possible to reach a solution to the conflict with Abu Mazen in the foreseeable future. Therefore we have to get used to the idea that we are in crisis-management mode and that we aren't going to solve it. It has been going on for 20 years and it might continue for another 100 years."

Some people say Netanyahu is acting out of a political survival instinct, so he can position himself as the unequivocal leader of the right.

"I suggest that we put the political issues aside. It's a shame - we all face a challenge, not only Likud but every Zionist who lives in this country."

You are considered one of the most popular and most right-wing Likud ministers. Do you plan to run for head of the party after the Netanyahu era?

"This is not the time to discuss such matters. There is a prime minister and we must give him our support and strengthen him, and that's what I'm doing."