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On Wednesday, a few hours before flying to Washington, Benjamin Netanyahu remembered his job as head of the opposition and rattled off some comments about Prime Minister Ehud Olmert. "We have to hold elections," Netanyahu declared. "The prime minister has lost the public trust."

This was a rare public criticism from the Likud leader, who has been trying to appear statesmanlike over the past few months and generally avoids frontal assaults on the government. He apparently figured it wasn't worth kicking a dead political horse that enjoys negligible support in the polls, and that it's better to keep quiet until the government collapses on its own.

But something has changed over the last few days.

"I'm convinced that the government will not live out its days," Netanyahu said in an interview with Haaretz, in which he accused Olmert of being helpless in the face of the Iranian threat. "The nation is searching for leadership, and if the government doesn't gain its composure, the change will come," he added. "Time will tell whether it happens in a parliamentary or electoral process, but I am convinced that it is not just the will of the opposition, but the will of the nation."

Although it is possible for the government to recover, there's "no sign" of that happening, Netanyahu said. "On the contrary: There is a reverse process of maneuvers, delays, futile exercises and dealing with unimportant and political exercises, rather than with changes that must be initiated in the country."

Netanyahu also identified his political target this week: Kadima's stockpile of MKs and voters. The crowning of the Likud leader as Olmert's successor during the current Knesset will require that at least 11 members of the prime minister's faction return to the Likud. And if the elections are held early - something that Netanyahu doubts will happen - the Likud will need votes that it lost to Kadima and to Yisrael Beiteinu in 2006.

Perhaps because of this, and perhaps due to the upcoming Winograd Commission report on the war in Lebanon and its potential ramifications, Netanyahu is signaling a move to the center, and is making surprisingly optimistic statements about the chances of a political process with the Palestinians.

"I see a unique opportunity for progress in the peace process with moderate Arab partners, for a simple reason: There is identification of a shared threat," he explained. "Even if Iran's nuclear program is stopped, the extremist Islamic threat exists, and that allows for the creation of alliances with various elements in the Arab world as well as in Palestinian society."

And would you agree to withdraw from territories as part of such a peace process?

"If I knew that I had a genuine partner. I have already proved that I am prepared to make certain concessions, not sweeping or unlimited, but I demanded mutuality and as long as I received it, I was able to progress."

Would you accept the Saudi initiative (withdrawal from all territory in exchange for fully normalized ties between Israel and the Arab world, and a "just and agreed-upon" solution to the refugee problem) as the basis for negotiations?

"The Saudi initiative cannot be implemented in terms of its details, but we have to aspire to an arrangement in which it is clear that if Israel is required to make additional concessions, it knows from the start that there will be no more demands and that the conflict is reaching an end. That did not exist in the negotiations that we conducted until now. We have to make an arrangement, get to the end, and then go backward."

Head of the Majlis

Despite the optimistic statements, Netanyahu does not currently see a Palestinian partner for an agreement, and demands that the peace partner will recognize Israel's right to exist. He is also not enthusiastic about the renewal of the Syrian negotiations channel, and says he tends to accept the assessment of Mossad espionage agency head Meir Dagan, that Syria is not heading toward peace. Netanyahu quotes intelligence assessments that the Syrian military-acquisitions budget has increased tenfold. On this matter, his position is no different from Olmert's.

Netanyahu has long been acting like the opposition head of the Majlis, Iran's parliament, rather than that of the Knesset. His public criticism is directed toward Iranian President Mahmoud Ahmadinejad. Netanyahu goes around the world and calls for Ahmadinejad to stand trial for incitement to genocide. His upcoming trip to the United States will also center around the struggle against Iran and its nuclear program. He will speak at the American Israel Public Affairs Committee (AIPAC) lobby's annual conference next week, and meet with U.S. Vice President Dick Cheney and the leading candidates for president.

"The Iranian regime is more vulnerable than it seems," said Netanyahu. "It's possible to act against it in a firm and focused way, to destabilize it, or stop the nuclear program, or both. Its major weakness is in the economic sphere."

The idea of imposing a "secondary boycott" on the Iranian economy is at the center of Netanyahu's campaign. It involves convincing the managers of pension funds for civil servants in every state in the United States, which hold assets worth hundreds of billions of dollars, to pull their investments from some 400 companies, from European and other countries, conducting business with Iran. Such a boycott would threaten the Iranian economy and the stability of its government. Netanyahu also wants to send AIPAC activists to governors and state legislatures in a bid to get them to order the pension funds to impose the boycott. This week, he submitted a similar bill in the Knesset, which, if passed, would ban Israeli investment in multinational companies active in Iran.

"All who feared military efforts against Iran should welcome an economic means that can render military activity unnecessary," Netanyahu said.

In his latest travels in Europe, he presented this idea to members of the French National Assembly's foreign affairs committee and to members of the British parliament. He tells doves to support the boycott so as to prevent an attack on Iran; the hawks will support pressure on the Iranians anyway. "It's not certain that the effort will succeed," Netanyahu admitted. "But even if it doesn't, at least public opinion will be prepared for tougher action."

Same 1938 analogy

In a speech before the General Assembly of the United Jewish Communities in Los Angeles in November, Netanyahu made a chilling analogy between present-day Iran and 1938 Germany. Since then, he has continued to draw this analogy. In his talks in Washington next week, he will suggest the establishment of a "coalition against genocide" that would act against the genocide in Darfur - an issue that is important to the Democrats - and against Ahmadinejad, the Holocaust denier who has called for Israel's destruction. The coalition would be "against a genocide that is carried out, that which is denied, and that which is planned," Netanyahu explained.

Is Israel facing a holocaust?

"I think it's possible to stop this holocaust, these threats. The situation is identical to 1938, in that an extreme ideology is present that is arming itself with weapons, with the declared attempt of destroying a significant portion of the Jewish people. The situation is different, in that there is a State of Israel that can and must elicit international pressure, and also because there is [now] a historic perspective. When [U.S. Secretary of State] Condoleezza Rice said that we are not in 1938, she was not referring to a change in the intention to destroy, but to the application of the historic lesson. On the contrary: Let us see the application, but it depends on actions carried out in the exhaustible time [that's left]."

Netanyahu quoted the Mossad chief's assessment that Iran will achieve nuclear capability within about three years. "That's not a lot of time, 1,000 days," the Likud leader said.

Aren't you concerned that your talk of a holocaust will lead to demoralization and will encourage young Israelis to flee just in order to be saved?

"The right thing that generates hope is not repressing the threat, or blurring it and concealing it, but the readiness to face it and to muster the many forces we have, and to lead the world to understand and stand up against it. There is a future, there is the capacity to halt this, to stop Iran and, if necessary, to build a massive deterrence."

Is the Olmert government doing enough?

"Unfortunately not. I would like to see a greater effort, and I said so to the prime minister. An all-out effort, which tries to use all the available tools to generate economic, political and public-relations pressure to isolate Iran, destabilize the regime or freeze the nuclear program. A master plan is needed, with the direct involvement of the prime minister."

Netanyahu advocates significant investment in development of defense and deterrence methods. When he was prime minister, he increased the budget for that, and today notes that Israel "will be required over the coming decades to build capabilities of a much larger scope than what there is." He said the necessary technology exists, and that if Israel continues along the right economic path, it will be able to fund the development on its own.

"On these matters," he said, "the person in opposition, and certainly the opposition head, faces a genuine dilemma. In the internal realm, things must be said and must be subject to discussion, argument and criticism, but they cannot be part of the public discourse. There is a paradox concerning everything related to nonconventional matters. This discussion takes place, and I take an active part in it as the opposition chairman, in subcommittees, and I think that to a large extent [I am] also an expediting factor on certain matters. But I cannot go into it in public."

'A responsible opposition'

Benjamin Netanyahu loves to quote Winston Churchill, whose warnings concerning Hitler's arms buildup in the 1930s were not heeded. So, why shouldn't Netanyahu act like Churchill, who became the first lord of the admiralty in the government of his rival, Neville Chamberlain? When such an existential threat is at hand, why shouldn't Netanyahu boost Olmert and run his public campaign around the world as a cabinet member instead of from the opposition?

"My colleagues and I acted as a responsible opposition," said Netanyahu. "We supported the government from day one, including during the war and afterward."

Why drag the country into an election campaign when time is running out and the Iranian bomb is ticking? After all, Ahmadinejad won't wait.

"A vast majority of the public wants elections precisely for this reason, [because] there need to be rapid changes of leadership. Elections can be held in a few short weeks and a government can be brought in to take care of the problem. How will it help you for time to pass like sand between your fingers without any action and without the necessary steps being taken for our defense, to recruit the world against Iran? In such situations, it's desirable for the public to give a renewed mandate to deal with these threats, which didn't happen in the previous elections, which were conducted on the basis of completely different assumptions that in the meantime proved to be false. In a democracy, a government that is chosen on a platform that turns out to no longer be valid needs to go back to the public and ask for a renewed mandate. That's why in a parliamentary democracy, there are ways to replace a government in mid-term, as a result of deficient functioning or a change in mandate."

The Prime Minister's Bureau said in response to Netanyahu's comments that the prime minister was directing a "complex operation" to deal with the possibility of a nuclear Iran.

"Management of the Iranian problem is being coordinate by the prime minister, and involves hundreds and thousands of people in the security branches, intelligence and political bodies of the State of Israel," the bureau said in a statement. "This is a complex operation, more sensitive than any other, to which the prime minister is dedicating long hours of his schedule every week.

"Just recently, the prime minister held a meeting with subcommittee members of the [Knesset] Foreign Affairs and Defense Committee, in which he provided them with a summary of Israeli activity on the matter. All the members of the committee - apparently excluding Mr. Netanyahu - received a completely different impression [from the picture he portrays], and even made the effort to point this out repeatedly to the prime minister. There is no subject or topic that Mr. Netanyahu does not try to enlist in an effort to damage the government, even if it will entail damage to the State of Israel's most crucial interests. Thus, he proves once again that there is nothing like scare tactics to serve his political goals."