LIVE UPDATES: Netanyahu Offers Hardliner Avigdor Lieberman Position of Defense Minister in Expanded Coalition

Sources privy of the coalition negotiations between the Likud and Yisrael Beiteinu say that the sides have bridged the gaps and are now just tie up loose ends.

"There are no gaps between us," they say. "The main task now is closing the budgetary aspects with [Finance Minister] Kahlon" for legislation Yisrael Beiteinu are interested in passing.

A meeting between Minister Levin, who is in charge of the coalition negotiations on behalf of Netanyahu, and Lieberman has ended. The two have agreed to meet again on Thursday in an attempt to strike a deal as soon as possible.

Referring to the actions of Zionist Union head Isaac Herzog, party MK Shelly Yacimovich said on Wednesday night that "we have witnessed a miserable, depressing and regrettable lack of leadership and zero accountability on the part of the person who with his own hands rolled out the red carpet for [Yisrael Beiteinu leader Avigdor] Lieberman, and completely legitimized the right-wing government when he was ready to enter it at any cost."

"Herzog is lying when he ticks off a fictional list of achievements that never was and that [Prime Minister Benjamin] Netanyahu, according to him, anyhow wasnt willing to put in writing, and he's lying when he's talking about "begging for a post," Yacimovich said, referring to Herzog's remarks that she was interested in top ministerial positions in his negotiations with the prime minister.

A senior Likud source says that Lieberman's appointment as defense minister will involve a reshuffling of the cabinet. Netanyahu, he says, is considering giving Ya'alon the Foreign Ministry as compensation. As part of the reshuffling, Minister Ze'ev Elkin will be given the Economy Ministry instead of the Immigrant Absorption Ministry.

Two other ministers who have expressed their interest in the economy portfolio are Tourism Minister Yariv Levin, a confidant of Netanyahu who is in charge of the coalition negotiations on the prime minister's behalf, and Culture Minister Miri Regev.

Likud MK Benny Begin said that "the idea to appoint MK Lieberman as defense minister is bizarre." Speaking on Channel 2, he said that "this move displays a lack of responsibility toward the defense establishment and toward the citizens of Israel.

"The prime minister apparently prefers to trade the day-to-day difficulties of managing a limited coalition for difficulties that are several times greater, as well as for dangers that will arise from this appointment."

Opposition Leader Isaac Herzog said at a press conference in Tel Aviv that the policies of a Netanyahu-Bennett-Lieberman government will be "verging on insanity."

"From now on, the citizens of the State of Israel will have to deal with a government whose policy will be verging on insanity," Herzog said. "This I tried to stop."

Herzog blamed MK Shelly Yacimovich (Zionist Union), who opposed the negotiations with Netanyahu, accusing her of "extreme left-wing positions" and said that "she will bear the responsibility for the appointment of Lieberman as defense minister."

Herzog says he notified Netanyahu on Tuesday that the coalition negotiations reached a dead end even though the two reached some agreements. The Zionist Union leader says he asked Netanyahu to have the deal in writing, but Netanyahu refused.

Herzog said that the achievements reached in the talks included a veto on building in the West Bank, a blanket veto on all racist legislation, "far-reaching" socioeconomic achievements, being in charge of Israel's foreign affairs and diplomatic negotiations, as well as the defense portfolio, the foreign affairs portfolio, the economic affairs portfolio and seven more, plus five deputy ministerial positions, four Knesset committee chairs, including the prestigious Foreign Affairs and Security committee.

A source in the Likud party says the deal with Lieberman is nearly sealed. "Lieberman is taking the offer to be appointed defense minister seriously," he says.

Tourism Minister Yariv Levin will head the Likud's negotiation team and will meet with Lieberman on Wednesday evening or Thursday morning.

Opposition Leader Herzog calls a press conference at the Zionist Union headquarters in Tel Aviv at 8 P.M. This is the second press conference he calls in just one day.

Health Minister Yaakov Litzman's bureau said that Netanyahu called the minister and informed him about the progress in the talks with Lieberman.

A statement said that Litzman, a member of the ultra-Orthodox United Torah Judaism faction, told Netanyahu he welcomes the expanding of the coalition and stressed that he expects that the agreed-upon government policies will remain unchanged, specifically the ultra-Orthodox draft law.

Netanyahu informed cabinet ministers that he has offered Avigdor Lieberman the Defense Ministry and the Immigrant Absorption Ministry in the expanding coalition.

Netanyahu and Lieberman have agreed to form negotiation teams to further discuss the terms of Yisrael Beiteinu joining the government. Netanyahu is now updating the heads of the coalition parties on the details of the meeting.

Sources close to Lieberman said that the meeting was good and that the two have agreed to meet again tonight.