Unity at Last

By William E. Smith

A Labor-Likud agreement

As Labor Party Chairman Shimon Peres and outgoing Prime Minister Yitzhak Shamir emerged from a private meeting last Wednesday morning, reporters asked them the crucial question: After almost five weeks of negotiation, had Labor and the ruling Likud bloc agreed to form a government of national unity? Replied Shamir: "Almost."

That was good news for the Israeli public, which had been waiting for weeks for something to happen. Ever since the July elections, in which Labor won 44 seats and Likud 41, Peres had been trying to put together a government. But neither he nor Shamir, the head of Likud, had managed to attract enough support from the country's smaller parties to assemble the necessary bloc of 61 or more seats in the 120-member Knesset. From the beginning there had been talk of forming a unity government between the two major parties. Last week, despite a flurry of last-minute hitches, the two sides actually seemed to have brought it off, and the new government is expected to take over this week.

Under the plan, Peres, 61, will serve as Prime Minister for the first 25 months, while Shamir will become Acting Prime Minister and Foreign Minister. During the next 25 months after that, assuming that the government holds together, the two men will exchange jobs. Yitzhak Rabin, who was Labor Prime Minister from 1974 to 1977, will serve as Defense Minister during the full 50-month term, and the Finance Ministry will go to a Likud member, probably outgoing Energy Minister Yitzhak Moda'i. Former Defense Minister Ariel Sharon, who was a Minister Without Portfolio in the Shamir government, was said to be interested in either Finance or Agriculture, but announced late last week that he would become Minister of Industry and Trade.

The burning question was not whether a unity government would work -Israel had such a government from 1967 to 1970 -but whether this one would be strong enough to deal with the urgent problems facing the country. Even Peres sounded only partly convincing when he noted guardedly, "It will be an interesting experiment." Some were openly skeptical. "It's not a government," declared Mordechai Virshubski of the small Shinui Party. "It's a constitutional catastrophe." Several of the small parties in the Knesset have agreed to support the coalition. But the far left and the far right oppose the plan, and Mapam, a tiny leftist party, has threatened to pull its six members out of the Labor alignment if the unity government is formed. But the majority of Knesset members probably agreed with outgoing Transport Minister Haim Corfu, who noted, "Labor and Likud are not getting together because they want to, but because of the difficult reality posed by the economy."

That reality includes an annual inflation rate of 400%, dangerously low foreign-currency reserves of $2.6 billion and a rising unemployment rate of 5.9%. The new government's first steps may include a slashing of public expenditures, a freeze on prices and wages and possibly a major devaluation. Labor and Likud have agreed to press for a full withdrawal of Israeli forces from southern Lebanon as soon as possible. Most difficult will be the question of Jewish settlements in the West Bank, which Labor wanted to freeze and Likud wanted to keep building and expanding. The parties have agreed to construct five of 27 previously approved settlements during the next year and to postpone decisions on other settlement questions. Future Israeli participation in any U.S.-sponsored peace initiative will require the support of both Labor and Likud and thus may not be possible to achieve.

Why is it sometimes so hard for either major Israeli party to form a government? Part of the explanation lies in the fact that under present law a political party needs to receive only 1% of the popular vote in order to win a Knesset seat. Thus in the July elections, 15 parties won parliamentary seats, but 13 of these had a total of only 35 seats. As a modest step toward reducing the inordinate power and influence of the small groups, some Israelis favor raising the minimum support required of a party from 1% to 3% of the vote. In the past, Labor and Likud have both been reluctant to press for such a change because they have needed the support of the small parties. Under a unity government, however, they will not need this support and may at last feel free to carry out this badly needed reform.

With reporting by Robert Slater