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In the process of forming her government, Tzipi Livni is being forced to swallow quite a few bitter pills. In coalition bargaining, as in diplomatic negotiations, concessions and compromises are the name of the game. When the only alternative is early elections that will bring Benjamin Netanyahu back to power, alongside Avigdor Lieberman and Effi Eitam, adjusting the budget is a necessary evil. In order to ensure that her already unstable party does not splinter, the prime minister-designate can be forgiven even for taking such a bizarre step as appointing Shaul Mofaz as foreign minister. But there is one demand that Livni must not accept, even at the cost of returning the mandate to the president: Shas' veto regarding negotiations over Jerusalem.

The demand by Shas Chairman Eli Yishai, as he told the media, to receive a public promise from Livni, preferably signed, that she "does not intend to bring up the subject of Jerusalem in negotiations with the Palestinians," is not even worth negotiating. Livni must inform Yishai publicly, preferably in writing, that he can forget about that demand. She must tell him that if he wants a promise that Jerusalem will not be a part of the negotiations for a final status agreement, he should look for it in the Likud. It can also be suggested to him that on his way there, he should order posters proclaiming: "Livni will divide Jerusalem."

The minister of industry, trade and labor, who also insists on the title "deputy prime minister," is in effect conditioning his participation in the Livni government on a declaration by the candidate for the premiership to the effect that she promises to refute a written public commitment by the Israeli government.

Livni - and Yishai himself - are still members of a government that less than a year ago gave its blessing to the joint declaration read by U.S. President George W. Bush at the Annapolis conference, which proclaimed there that "In furtherance of the goal of two states, Israel and Palestine, living side by side in peace and security, we agree to immediately launch good-faith bilateral negotiations in order to conclude a peace treaty, resolving all outstanding issues, including all core issues, without exception, as specified in previous agreements. We agree to engage in vigorous, ongoing and continuous negotiations, and shall make every effort to conclude an agreement before the end of 2008."

Yishai is asking Livni to mislead the Israeli public as well. The prime minister-designate, and Yishai himself, are signatories to the basic guidelines of the outgoing government, according to which "the government will aspire to bring about the shaping of permanent borders for the country, as a Jewish country with a Jewish majority and as a democratic state." The government promised to do so in negotiations with the Palestinians, to be conducted in relation to signed agreements, including the principles of the Road Map. The "map" specifically determined that the parties would conduct negotiations in order to reach an agreement that will lead to an end to the occupation that began in 1967, and include a consensual, fair and realistic solution to the refugee issue and a decision on the status of Jerusalem.

It is hard to believe that Yishai is deceiving himself. As a veteran member of the cabinet, he is intimately familiar with the core issues on the negotiating table. Yishai knows that there can be no peace treaty with the Palestinians without an arrangement regarding the borders of Jerusalem, the fate of the Jewish neighborhoods and arrangements for administering the holy places. He certainly knows that the 22 members of the Arab League are waiting for Israel's response to their proposal of March 2002 to replace the state of war with normal relations, in exchange for the establishment of a Palestinian state whose capital is (East) Jerusalem.

The initiative was designed, among other things, to establish a solid coalition in order to check the spread of radical Islam under the leadership of Iran and world Jihad. This coming March, the Arab summit will reexamine the proposal in light of progress in negotiations with the Palestinians (and Syria).

The bitter experience of the Camp David summit of July 2000 teaches that postponing the discussion of Jerusalem is an act that lacks diplomatic logic. In exchange for "concession" of sovereignty in an area that includes over a quarter of a million Palestinian residents in East Jerusalem, Israel can demand recognition of its sovereignty over most of the Jewish neighborhoods built in the city and its environs since June 1967. In exchange for special arrangements in the Old City that will satisfy members of the three religions, Jerusalem will for the first time receive international recognition as the capital of Israel.

Livni can adopt Ehud Olmert's manipulative methods; she can promise Yishai that Jerusalem will not be on the negotiating table and conduct the negotiations under the table. But she was not elected in order to carry on the Olmert legacy.