US embassy cable - 04TELAVIV6373

C O N F I D E N T I A L TEL AVIV 006373 
 
SIPDIS 
 
E.O. 12958: DECL: 12/15/2014 
TAGS: PGOV, IS, GOI INTERNAL 
SUBJECT: LIKUD-LABOR TALKS STALLED AS BOTH PLAY HARDBALL 
OVER CABINET SEATS 
 
Classified By: Ambassador Daniel C. Kurtzer for reasons 1.4 (b,d). 
 
1.  (C) The current snag in Likud-Labor coalition 
negotiations over which cabinet seats Labor would receive is 
likely the result of poker game tactics by both sides. 
Embassy contacts do not expect the snag to prevent a 
Likud-Labor agreement.  Referring to the breakdown in 
Likud-Labor talks as a "political game," a Labor Party 
spokesperson, Dana Zaidman, told poloff December 15, that 
while the two sides have stopped talking, "it is obvious" 
that Labor and Likud will eventually find a compromise, "most 
likely early next week."  Labor's lower-profile budget 
demands, including assistance for the elderly, will also be a 
part of any agreement.  Likud MK Yuval Steinitz's Chief of 
Staff, David Sharan, also assured poloff December 15 that 
Likud and Labor would "work something out," pointing out that 
coalition negotiations "are always like this."  Or Pearl, 
advisor to Likud MK Ehud Yatom, echoed this view and noted 
that negotiations may take a week longer than expected. 
Pearl reasoned that Labor cannot be seen as "crawling to the 
coalition," hence it is finding something to fight about. 
Pearl also stressed that an agreement will be reached because 
"no one wants elections." 
 
2.  (C) Likud reluctantly agreed December 15 to offer Labor 
the Interior Ministry -- provoking angry reactions from Likud 
MKs -- but Labor is also demanding Education, Transportation, 
and Public Security.  Labor aide Zaidman expressed skepticism 
that Labor would enter the coalition without portfolios. 
Labor MKs Chaim Ramon and Ofir Pines-Paz threatened that 
Labor, if not offered its preferred portfolios, may insist on 
joining the coalition without designated portfolios and 
remain partners only long enough to ensure that 
disengagement is implemented.  Likud staffer Sharan predicted 
that Labor would eventually settle for the Interior Ministry 
and several other portfolios, which he did not name. 
 
3.  (C) While talks with Labor have stalled, Likud continues 
to negotiate with United Torah Judaism (UTJ) and Shas over 
their demands for joining the government.  UTJ appears the 
closest of all the parties to wrapping up a coalition deal 
with Likud.  A Likud negotiating team member claimed to the 
press that UTJ would likely receive chairmanship of the 
powerful Knesset Finance Committee if it agrees to join and 
may also receive a deputy ministerial position in charge of 
religious affairs, a seat that currently rests in the Prime 
Minister's office.  UTJ may also demand the position of 
deputy minister in the Housing Ministry.  An agreement 
between Likud and UTJ could be reached this week. 
 
 
********************************************* ******************** 
Visit Embassy Tel Aviv's Classified Website: 
http://www.state.sgov.gov/p/nea/telaviv 
 
You can also access this site through the State Department's 
Classified SIPRNET website. 
********************************************* ******************** 
KURTZER