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It is 11:40 in the morning of Rosh Hashanah eve. Two empty glasses of vodka are on the corner table in Vice Premier Shimon Peres' office in Tel Aviv. Attorney Ram Caspi, a close associate of his, leaves the office with a little buzz. Another meeting begins, this time without vodka, but with a glass of red wine poured from a new bottle, a holiday gift from a politician-turned-businessman, Rafi Elul.

The moderate dose of alcohol, at the juncture between morning and afternoon, does not detract a bit from Peres' clarity. It even adds some acuity. Without wasting time, he describes for the first time the four demands he plans to present to Prime Minister Ariel Sharon as a condition for the Labor Party remaining in the government through the formal date of elections, in late-October/early-November 2006. If all these conditions are met and without creating unnecessary tension around them, one can assume that Sharon would not find it difficult to meet them the lucky prime minister will have a functioning coalition for another year. These are the conditions for a continued partnership between the Labor and Likud parties during this term and the next term as well: "We have to conclude the whole issue of Gaza by the end of this year," Peres says. He is referring to the completion of the withdrawal from Gaza in economic terms: border crossings, the transport of goods, economic cooperation and aid issues.

The second condition follows: "After the issue of Gaza is resolved, negotiations with the Palestinians can begin on the [United States'] road map." Peres finds a difference between Sharon and himself on this front: He believes there is no reason not to proceed with negotiations even though terror continues, just as British Prime Minister Tony Blair acted vis-a-vis the Irish underground. Meanwhile, Sharon is sticking with his condition: no negotiations as long as terror continues. Ostensibly, this constitutes a dispute. But don't worry a formula will be found. This will not unravel the package.

Peres' third condition, for "a war on poverty," will also not dismantle anything. He expects Sharon and acting Finance Minister Ehud Olmert to adopt the Peres-Isaac Herzog plan to wipe out poverty (which requires an investment of NIS 4 billion). He signals a readiness to compromise: "Every agreement," he says, "is the result of compromise." He has identified a readiness by Sharon and Olmert to come to terms with him. "After all, they opposed Bibi's policies," Peres notes. "They have an opportunity to demonstrate this now. They also are opposed to poverty, and we have tax revenues that are not inconsiderable. We have from where to take."

The fourth condition is "continued momentum in the Negev and Galilee," assuming that there is something to continue. Peres says there is. Again, there is no need to make a big fuss about these four conditions. Even as a starting point for negotiation, Sharon could easily meet them.

Wait a moment, Peres is asked. What about the evacuation of dozens of illegal outposts? "We'll definitely demand their evacuation," he says disinterestedly. "That is the position of the Labor Party." Will you present an ultimatum to Sharon? "I have always opposed ultimatums," he says, and quotes Avraham Hertzfeld, a seasoned Mapainik, who used to say: "I present an ad hoc ultimatum." "I also present an ad hoc ultimatum," Peres laughs.

Nonetheless, how is he different than Sharon? From Peres' response, it seems that he views his differences with the prime minister as pertaining to the final stage of negotiations between Israel and the Palestinians: the size of the settlement bloc, primarily. That is, from his perspective, he and Sharon can continue to stride together arm in arm into the sunset until peace arrives.

A number of top Labor Party members who are familiar with Peres' stance regard this as nothing less than a total abdication of the party's right to exist. Peres is prepared to turn us into a division of the Likud, they say. On the other hand, they are also not sure what the alternative is: a forced, artificial departure on the eve of elections would be of no avail. This was demonstrated in 2002 when the Labor Party headed by Benjamin (Fuad) Ben-Eliezer broke up the unity government ostensibly over transfer payments to the elderly and dropped to 19 Knesset seats in the elections held three months later.

Peres is not buying:The talk about his party leaving the government after the primaries, on November 9, irritates Peres. He does not understand why it is necessary to leave the government. Just to do so? Because it is customary to do this prior to elections? "There are no rules," he says. "In these matters, I don't know what is better to run for election from within the government or from outside. The main question is how we will spend 2006 on a drawn-out election campaign or a war on poverty. If we quit in November-December, everything will come to a halt. The campaign will take half a year, two more months will be spent forming a government, and 2006 will go down the drain. In the meantime, poverty will thrive and Hamas will be active. The matter of Gaza will not be completed. Idi Amin once gave advice to his surgeons: Don't leave instruments in the patient's body. I say the same thing about Gaza: Let's not leave instruments in Gaza. We need to complete the surgery, the disengagement.

"As a decent person, I ask myself: If it is possible to begin to emerge from poverty in November, should we postpone this for a year? What, am I crazy? [Histadrut labor federation chairman and MK] Amir Peretz did not want to enter the government to help exit from Gaza. Now he has doubts about whether we should remain in the government so that we can help in the departure from poverty."

Peretz, Peres' principal rival (according to opinion polls) in the Labor Party primaries, is one of the obstacles threatening the theory of the complete term for the Sharon government. For Sharon to indeed complete the term of his government, several things must happen: Peres must triumph over Peretz in the primaries and be elected Labor Party chairman; the Likud rebels who embittered Sharon's life must internalize the results of the Likud central committee vote and begin to function as a disciplined coalition during the year that remains; and Sharon must run in the Likud primaries against Benjamin (Bibi) Netanyahu in April-May 2006 and win. If all of these conditions are met, Sharon is in the driver's seat. Compared to the two main obstacles the Likud rebels and the Labor Party primaries this is a picnic.

If Sharon leaves the Likud and forms a new party, a center-right party under his leadership, this is liable to destroy Labor. The polls say that in this scenario Labor would win 15 Knesset seats. What agenda would it present vis-a-vis Sharon after he took Israel out of Gaza? Haim Ramon is suggesting to Peres that Labor should already steal the platform of Sharon's new, future party: a presidential system of government, unilateral withdrawals from dozens of isolated settlements in the West Bank, consolidation within settlement blocs and a new social-economic agenda. If we adopt these positions today, Ramon argues in internal discussions, we will pull the rug out from under Sharon's party. Peres, so far, is not buying.

'Enough for a good Jew'A week ago, two days after Sharon's victory in the central committee, they met. Sharon told Peres that it was a difficult battle. "I wanted to prove to them that I could win," he said. Peres says that he thought Sharon had a chance, but only after Netanyahu began to stumble and make mistakes. "Bibi began with a chance," he says, "but then he made all of the mistakes. He killed his chance with his own hands. He cannot complain to anyone. But I derive no joy from his defeat. In general, his resignation was a mistake. I don't understand what stung him."

"I'm not complacent," Peres says about the competition that awaits him a month from now against Peretz, Matan Vilnai and Ben-Eliezer. Others in his circle do indeed sense complacency and warn him against it. One of them, a senior personage, characterizes what is happening at Peres headquarters as "nonexistence." Only recently have things begun to stir there. Former Labor secretary general Micha Harish, one of the party's best secretaries general ever, has joined the staff and is reorganizing it as a fighting force.

Does Peres regret his extraordinary efforts, confronting the entire world, to bring Peretz back to the Labor Party? "No," he says. "I distinguish between Amir's positions and the importance of bringing in the One Nation party. If I win, it will be good for the party that One Nation is inside it. It will bring us additional Knesset seats in the elections.

"I don't have a Catholic organization like Amir does," Peres says. "On the other hand, I have enormous support. We are not organized, but there is also a big advantage in a free atmosphere. It's easier to enter. I am not arrogant and it's clear that much depends on election day. We have a lot of volunteers who work with all their hearts. I myself do not rest for a moment. I work night and day. Here, yesterday [Sunday] I was in four places: Jerusalem, Haifa, Acre and Nahariya. That's more than enough for a good Jew.