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As the forces of former prime minister Benjamin Netanyahu begin to circle over a Sharon government sunk in a quagmire of war and recession, the prime minister is far from ready to concede defeat to the opposition that most threatens him: members of his own party.

In a dual campaign launched in recent weeks, master tactician Ariel Sharon has courted - in separate, behind-the-scenes meetings - lieutenants of arch-nemesis Yasser Arafat, and disciples of party rival Netanyahu in order to explore possible routes of quelling Israeli-Palestinian unrest, as well ensuring his own position as the leader of the party he himself virtually invented in the 1970s.

Ultimately, Sharon loyalists hope, the Israeli leader will thus keep his Likud-Labor-based unity government intact - with himself at the helm - until general elections scheduled for next year. The Sharon camp believes that if the prime minister can survive an expected Netanyahu bid to unseat him as party chief, Sharon can beat the electoral curse that has driven every incumbent prime minister from office in the last four elections.

But the weighty albatross of an unending Palestinian uprising and an ailing economy have boosted the hopes of Netanyahu-backers, whose field general in the Knesset, Likud lawmaker Yisrael Katz, openly said Monday: "I personally have no doubt that the next leader of the Likud will be Bibi Netanyahu. Whenever elections for the Knesset take place, I am convinced that he will run, and will be elected by a very great majority.

"Bibi Netanyahu is viewed as a man of principle and of consistency, the man who can rescue Israel from one of the worst security and economic crises it has ever known," Katz told Israel Radio, criticizing Sharon and his recent barnstorming of local Likud politicians nationwide. "Prime Minister Ariel Sharon should concentrate largely on running the affairs of state, its security and social and economic affairs, rather than dealing so intensively and devoting so much of his time to internal political activity."

Ha'aretz commentator Akiva Eldar remarks that if general elections were held now, Sharon, buoyed by support from centrist Labor voters, might well win. Within the Likud, in a race for party leadership, however, he might well lose.

"Bibi is Sharon's opposition, and within the Likud, there is no question that Bibi is the more popular, and is thus breathing down Sharon's neck." In fact, Sharon is more popular at this point among Labor voters than he is among those of the Likud, Eldar argues. Referring to newly elected Labor chief Benjamin Ben-Eliezer, who serves Sharon as defense minister in the unity coalition, he says: "The Labor voters don't especially like Fuad. They really don't want to take risks, they don't know Fuad too well, they don't like Bibi at all, and with Sharon, at least, what you see is what you get."

In meeting last week with the Palestinians, Sharon hoped to give Foreign Minister Shimon Peres justification to remain in the government, and thus keep the coalition whole, Eldar continues. "If Peres leaves, this could set off a process that leads to early elections, which could spell the end for Sharon."

In order to win against Netanyahu, Sharon must make good on a pledge to bring about security, if not peace. "He knows that security cannot be gained without giving the Palestinians something," Eldar says. "His advantage over Netanyahu now is that he can bring Israelis some results, and convince the Palestinians to take something that most Israelis are willing to give. For example, if the Palestinians agree to accept 42 percent of the West Bank and are willing to declare a state there, and if Sharon agrees to pull back from Gaza, this is something that Israelis will buy, and which Labor will also support."

Such an arrangement might also cause a split in the contentious right-centrist Likud, which could also work to Sharon's advantage.

The Netanyahu challenge also provides Sharon with a fringe benefit that the ex-prime minister could hardly have intended: an alibi for refraining from making sweeping concessions to the Palestinians. In the face of pressures from Labor at home and U.S. and EU officials abroad, Sharon can "use the argument of 'Bibi's breathing down my neck,' as a cover for his own (rightist) ideology. It gives him more leeway, and helps him to justify positions that he would have taken anyway," Eldar said. The impression given is that "if it were not for Bibi, Sharon would be more forthcoming, more flexible."

Eldar believes, moreover, that Sharon's hard-line stances are his alone. "He doesn't need Bibi to take these positions. They are pure Sharon. But in the briefings that he will be giving the Americans, Sharon can say that he must be careful, because he is maneuvering between Bibi and Shimon Peres."

In sum, Sharon is reaping a kind of political "discount" from Netanyahu's hawkishness, just as he profits from what the American administration has come to view as Arafat's duplicity, stubbornness, and refusal to assert his leadership. Notes Eldar, "It's true of both Netanyahu and Arafat, that if they weren't around, Sharon would have been well advised to have invented them."