US embassy cable - 05TELAVIV1842

C O N F I D E N T I A L TEL AVIV 001842 
 
SIPDIS 
 
E.O. 12958: DECL: 03/25/2015 
TAGS: PGOV, KWBG, ECON, IS, GOI INTERNAL, ECONOMY AND FINANCE, GAZA DISENGAGEMENT 
SUBJECT: REFERENDUM BILL EXPECTED TO FAIL, BUT SHARON STILL 
SWEATING TO MUSTER BUDGET MAJORITY IN UPCOMING KNESSET VOTES 
 
REF: TEL AVIV 1456 
 
Classified By: Ambassador Daniel C. Kurtzer for reasons 1.4 (b,d). 
 
1.  (C) The ongoing political machinations leading up to next 
week's Knesset votes on the 2005 budget and disengagement 
referendum legislation, do not change Embassy's expectations 
that Prime Minister Sharon will muster a Knesset majority for 
the 2005 budget and that a majority will defeat the 
referendum bill.  The budget and referendum legislation were 
voted out of committees March 22 and March 23 respectively. 
Statements issued by the Prime Minister's office March 25 
that the budget may fail, as well as reports of Likud 
elections preparations, could be part of Sharon's tactics to 
pressure MKs that do not want early elections and/or to be 
responsible for disengagement failing.  Sharon will meet 
Shinui leader Tommy Lapid March 26 and Yahad leader Yossi 
Beilin March 27 to seek either yea votes or abstentions from 
their parties' MKs.  At least five of the six Yahad members 
are willing to help Sharon. 
 
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Budget Votes 
------------ 
 
2.  (C) Sharon can still only count on 53 MKs (reftel) to 
support the budget, with 67 MKs either wavering or set to 
oppose the budget.  Embassy sources have indicated that 
Sharon may need more than an absolute majority of 61 MKs to 
ensure government majorities in votes on numerous budget 
amendments.  Embassy sources expect Sharon to garner the 
necessary combination of yeas and abstentions from at least 
one Arab party and Yahad, and perhaps several of the 13 Likud 
rebels, who have tied their support for the budget to 
Sharon's support for a referendum.  If the referendum bill 
fails on March 28, some of the Likud rebels may decide  that 
since the referendum is dead, they can therefore support the 
budget.  Sharon may sweeten the pot by offering some of the 
rebels funds for pet programs. 
 
3.  (C) Shinui MK Ilan Leibowitch told poloff March 24 that 
Lapid is not sharing his strategy and ultimate decision with 
Shinui's rank and file.  Leibowitch and fellow Shinui MK Ehud 
Rassabi told poloff separately March 24 that most Shinui MKs 
do not want Sharon's government to fall, but that Shinui's 14 
MKs will follow Lapid's voting instructions.  Leibowitch 
confided, however, that he will have a hard time sticking to 
party discipline if his vote would prove decisive. 
Leibowitch speculated that Lapid would announce shortly 
before the vote that Shinui will abstain to save 
disengagement. 
 
--------------- 
Referendum Vote 
--------------- 
 
4.  (C) Chances for passage of the referendum bill are 
negligible, regardless of the vote of Shas, which resists the 
concept of referendums out of fear they could be used on 
religious issues.  Shas spokesperson Yitzhik Soudri and Shas 
MK Amnon Cohen told poloff March 23 and March 24 respectively 
that they are confident that Shas spiritual leader Rabbi 
Ovadia Yosef will instruct the 11 Shas MKs to oppose the 
referendum.  Soudri said he did not expect Rabbi Yosef to 
change his opposing position despite the "heavy pressure" 
that settler movement rabbis are exerting on him to support 
the bill.  Ultra-Orthodox Agudat Yisrael MK Ya'akov Litzman 
and Degal HaTorah MK Moshe Gafni indicated to poloff that 
their respective parties will also oppose the bill, although 
Gafni was less committal.  Assuming the positions of these 
religious parties remain firm, over 70 MKs would rally 
against the bill.  If it fails, the Knesset cannot reconsider 
a disengagement referendum bill for six months. 
 
 
 
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KURTZER