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Benjamin Netanyahu's election slogan in 2009 was "Strong on security, strong on the economy." A year later, he can claim that his promises were kept. The Israeli political landscape during the past year seemed more like that of a small and peaceful country in Europe - say Finland or Slovenia - than a reflection of the tumult of the Middle East.

Israel enjoyed a year of calm on matters of security, the likes of which there hasn't been for a decade, both on the borders and in terms of terrorist attacks. The economy made it through the worldwide recession honorably, with only a slight increase in unemployment and without any large businesses collapsing. The busiest journalists were the crime reporters: Incidents of murder multiplied, ostensibly ordinary people like entertainer Dudu Topaz turned out to be dangerous felons, and the former prime minister was put on trial as a thief.

Netanyahu promised and delivered when it came to running the country, too. "Since my first term I have learned to be a politician," he told me before the election last February. I wasn't convinced at the time, but the results have borne out his words. Although the Likud received one less Knesset seat than Kadima, Netanyahu formed a broad and stable government, and has led it without crises, leaks or friction. He has done this not by becoming a jolly good fellow like Ehud Olmert, nor does he terrorize people like Ariel Sharon. His method is different: Give the politicians a big car and a sense of importance, and they won't come out against you. Or, in less delicate language, pay protection to every potential rival. The main thing is to have peace and quiet.

Netanyahu inflated his cabinet with superfluous ministers and deputy ministers, in order to reduce the danger of boredom and ferment in the Likud. He passed a two-year budget, and reassured his coalition partners. He established the "forum of seven" for diplomatic and security consultations, so that the senior ministers would be seen as involved and influential. He appointed unsuitable people to high offices - Yuval Steinitz to the Finance Ministry and Avigdor Lieberman to the Foreign Ministry - so that he could ignore them and handle the economy and foreign policy by himself.

At the systemic level, the prime minister learned from the mistakes of his previous term, and avoided friction with either the army or the legal system. When the settlers rebelled against the freezing of settlement construction, he compensated them with money and affection.

Giving in to Obama

In the realm of foreign relations, Netanyahu was forced to deal with U.S. President Barack Obama and his enthusiastic vision of a comprehensive peace in the Middle East, a concept that centered on Israel's withdrawal from the territories and the establishment of a Palestinian state in place of the settlements in the West Bank. Those are exactly the opposite of the views that Netanyahu has preached throughout his career. The tension between him and the White House increased, and a crisis in relations with the U.S. seemed unavoidable.

Netanyahu gave in to Obama, accepted the idea of "two states for two peoples," and announced a 10-month settlement freeze. And though he compromised on his principles, primary among them "the right of Jews to live anywhere in the Land of Israel," and his firm and reasoned opposition to a Palestinian state, Netanyahu is seen as the victor in the confrontation with Obama. He dragged out negotiations over the freeze and got the Americans to give up their original demand, that a freeze should include East Jerusalem as well. He read the U.S. political map better than the president and his advisors did: Obama collapsed in the surveys and lost a great deal of support from the American public, at a time when the Republicans - supporters of Netanyahu - played a successful defensive game. Netanyahu was biding time until Obama lost his strength.

The prime minister may have been a pleasant surprise to some, but his accomplishments seem to be short-lived. His strength was seen in ongoing security issues, but not in dealing with Israel's basic strategic problems. The Iranian threat, whose elimination Netanyahu sees as his historic mission, remains unchanged. Iran continues to develop nuclear weapons and to arm Hezbollah and Hamas, and is worried only about the internal ferment in the wake of the fraudulent Palestinian presidential elections. Netanyahu, for his part, speaks about a "new Amalek" and is spurring preparations for military action, but his policy does not deviate from that of his predecessors, who preferred coordination with the U.S. administration and clandestine activity to embarking on a war against Iran. The major decision - whether to bomb or to accept the Iranian bomb - is still ahead of him.

'One state' takes root

On the Palestinian front, in the last year, Netanyahu failed in his attempt to renew negotiations with Palestinian Authority president Mahmoud Abbas, who refuses to meet with him - in striking contrast to the successful cooperation between Israel and the PA in maintaining the quiet in the West Bank. It can be claimed that this is a blessing for a right-wing government, which in any case does not want to give anything to the Palestinians, but the quiet does not look as if it will last.

By the time Netanyahu had accepted the idea of two states, the diplomatic discourse was gradually fleeing from him. The "one state" idea, even if it is not practical, is taking root in the internal debate in Israel, and abroad as well. The Netanyahu government is isolated in the world and has to deal with the difficult legacy left by its predecessor, in the form of the Goldstone report. And worst of all for Netanyahu: People don't believe him.

For the time being this is not hurting the prime minister's popularity at home, which has been bolstered by the security quiet and economic growth, but it is causing him difficulties in his international contacts. Abbas is not being tempted to "enter the room with him." The Jordanians and the Turks, Israel's strategic allies, are angry and keeping their distance. Obama is unwilling to give Netanyahu credit, as he gave the Palestinian leader, for "really wanting peace." According to the U.S. president, Netanyahu "wants to make progress," but is a captive of his coalition, in other words, hesitant and weak.

The postponement of difficult decisions, as in the affair of captive soldier Gilad Shalit, and the attempt to stay in power for as long as possible, have caused the personal behavior of Netanyahu and his wife Sara to make headlines. As during his first term, once again everyone is preoccupied with the moods of the prime minister's wife and her relationship with her maids, rather than with her husband's decisions. Even Netanyahu's political alliance with Ehud Barak is becoming shaky, and over the past two weeks the defense minister has been working to isolate himself from the prime minister. The premier is reacting to the pressure by moving to the right, in an attempt "to strengthen the foundation."

The second year of his tenure is going to bring him face to face with two crucial issues, which will determine the overall fate of his term. One is either Iran - or a security crisis in the north of the country or in the territories; and the second is the settlements. Netanyahu has promised that in September, at the end of the freeze, construction there will proceed apace. If he keeps his word, he will clash with Obama; if he folds, he will risk the right's departure from the coalition. That means that his pre-election promises will soon be facing a genuine test, after a year of pleasantly floating on calm waters.