Likud, Barak Draft Economic Plan as Part of Coalition Deal

Labor Party chairman Ehud Barak appointed coalition negotiators yesterday and ordered them to produce a finished agreement with Likud by tomorrow, so that he can present it to the party's convention when it meets that afternoon to decide whether Labor should join a Likud-led government.

Labor and Likud negotiators will meet this morning for a marathon session to finalize details of the agreement, whose outline has already been settled by Barak and Likud chairman Benjamin Netanyahu.

In addition to Barak retaining his current position of defense minister, Labor is demanding three other ministries - agriculture, infrastructure and the industry, trade and labor portfolio - plus one minister without portfolio. Barak and Netanyahu had agreed that Labor would receive five ministers, one deputy minister and one Knesset committee chairman, but did not sign on the specific posts.

A significant portion of the agreement will be devoted to socioeconomic issues, since the economic crisis is one of Barak's main arguments for joining the government. The outlines of the government guidelines on this issue were settled last week in a meeting among Netanyahu, Barak and Histadrut labor federation chairman Ofer Eini. The latter, who plans to speak at the Labor convention in favor of joining the government, argues that this move is essential, because there will be an "economic catastrophe if we don't unite our forces and form a stable government."

He also said that Netanyahu had "displayed willingness to go a long way toward our socioeconomic positions." Specifically, he said, the Likud chair promised not to cut the wages of government employees, to adopt two proposals for avoiding layoffs devised jointly by Eini and Manufacturers Association president Shraga Brosh, to protect retirees and pension savings and to launch a program to assist troubled companies.

In addition, Netanyahu agreed to establish a joint forum - consisting of himself, his finance minister, Eini, Brosh and Bank of Israel Governor Stanley Fischer - to steer economic policy.

Eini is one of the three coalition negotiators that Barak appointed, along with Agriculture Minister Shalom Simhon and attorney Alon Gellert.

On diplomatic issues, the government's platform will declare its commitment to continuing talks with the Palestinians and Syrians, but will not include the words "two states for two peoples."

Yesterday, bowing to pressure from within his party, Barak pledged to remain in Labor even if his proposal to join the government is defeated - something he had originally refused to do. Nevertheless, he came under renewed attack from opponents of joining the government over his decision to begin coalition negotiations immediately, instead of waiting for the convention's decision tomorrow.

"The appointment of a coalition negotiating team without the approval of the Labor Party's institutions is something that has never before been done," seven MKs opposed to the move said in a joint statement. "This violates the rules of the democratic game within the party and is an attempt to impose a fait accompli on convention members."

Currently, the convention appears evenly split between opponents and proponents of joining the government, leaving both sides fighting over every vote.