US embassy cable - 05TELAVIV4879

C O N F I D E N T I A L SECTION 01 OF 02 TEL AVIV 004879 
 
SIPDIS 
 
E.O. 12958: DECL: 08/08/2015 
TAGS: ECON, PGOV, PREL, KWBG, IS, GOI INTERNAL, ECONOMY AND FINANCE, GAZA DISENGAGEMENT 
SUBJECT: NETANYAHU BECOMES SPOILER WITHOUT SPOILS AS 
DISENGAGEMENT MOVES FORWARD 
 
Classified By: Deputy Chief of Mission Gene A. Cretz for 
reasons 1.4 (b,d). 
 
1.  (C) SUMMARY:  Finance Minister Binyamin Netanyahu's 
dramatic August 7 resignation from government will not affect 
implementation of the disengagement plan starting August 17. 
It will also not bring down Prime Minister Sharon's 
government since the opposition is not sufficiently united to 
muster the votes to topple Sharon.  Netanyahu's possible 
motivations for resigning now are partly to oppose 
disengagement in principle, but also to further his political 
aspirations of challenging Sharon's leadership of Likud. 
Netanyahu may be betting on disengagement's failure to reap 
political benefits.  Likud MKs, including supporters of 
Netanyahu, have been in meetings and huddling in the 
aftermath of Netanyahu's bombshell.  END SUMMARY. 
 
2.  (C) Finance Minister Binyamin Netanyahu's surprising 
resignation from government over his opposition to 
disengagement during the August 7 Cabinet session without 
offering an explanation, will likely not -- as Netanyahu 
himself admitted in his August 7 press conference -- affect 
the scheduled implementation of the disengagement plan August 
17.  This was made clear when the Cabinet went on to approve 
the evacuation of three isolated settlements in Gaza by a 
16-5 majority after Netanyahu left his resignation letter and 
departed the Cabinet session.  Anti-disengagement Likud 
ministers Limor Livnat, Danny Naveh, Yisrael Katz, and Tzachi 
Hanegbi voted against the evacuation, but did not indicate -- 
as settler leaders had hoped -- that they will follow 
Netanyahu's example. 
 
3.  (C) Netanyahu's move does not signal any meaningful 
threat to Prime Minister Sharon's government.  The Knesset 
opposition does not have the necessary unity to muster the 
required 61 votes to bring down Prime Minister Sharon's 
government in no-confidence motions.  Sharon still enjoys a 
combination of majority support from within and outside the 
coalition to keep his government afloat at least through 
disengagement and likely beyond.  As the dust settles, 
however, the looming question overshadowing the political 
landscape, is what effect Netanyahu's resignation and 
expected anti-disengagement activity will have on Sharon's 
standing in Likud, including in any preparations for Likud 
primaries.  (Note: Septel examines economic repercussions of 
Netanyahu's resignation.  End note.) 
 
4.  (C) Netanyahu's long-anticipated split from Sharon's 
government over disengagement signals Netanyahu's readiness 
to do more than snipe at Sharon from within the government; 
he is now portraying himself as a staunch opponent to 
disengagement, and vanguard of the Likud's right-wing. 
Within Likud, assessments vary as to how much power Netanyahu 
now wields within the party, even within the more right-wing 
Likud Central Committee (LCC).  Likud MK and Netanyahu ally 
Yuval Steinitz asserted August 7 on Israeli TV that support 
for Netanyahu is growing within the LCC, within the Likud 
Party, and within the Likud Knesset faction.  Likud MK and 
Sharon supporter Majallie Whbee, however, told Poloff August 
8 that after Netanyhau resigned, LCC members actually 
complained to Whbee that they do not like someone who "jumps 
out" from the government.  Whbee added that some LCC members 
complained to him about the timing of Netanyahu's 
resignation, noting that it is too late now to stop 
disengagement.  Whbee also noted that while the LCC is more 
right-wing than Sharon, it does not represent the majority of 
Likud voters.  An August 8 poll released by Ma'ariv shows 
that 51 percent of Likud voters support Sharon as Likud 
leader, compared to 34 percent who support Netanyahu.  Other 
politicos and media pundits have portrayed the timing of 
Netanyahu's resignation in a negative light, asserting that 
Netanyahu was motivated more by political ambition than by 
opposition to disengagement.  According to an August 8 poll, 
47 percent of the public believe that Netanyahu's move was 
motivated by politics, rather than principle. 
 
5.  (C) Meretz/Yahad MK Avshalom Vilan assessed to Poloff 
August 8 that Netanyahu actually wants disengagement to go 
forward, bargaining that the plan will face problems that 
Netanyahu can use against Sharon in the battle for Likud 
leadership.  In appealing to the right wing, Netanyahu will 
be able to say that while he voted for disengagement, he had 
no responsibility for it.  Vilan underlined that Sharon's 
political standing, especially within Likud, now depends on 
how well the evacuation goes.  Netanyahu, he commented, is 
placing all his political bets on disengagement failing so 
that he can reap the political benefits.  In the meantime, 
Sharon has seemingly bounced back after Netanyahu's 
bombshell, quickly appointing Deputy Prime Minister Ehud 
Olmert to temporarily serve as Finance Minister (septel), and 
thereby calming the jittery stock markets.  He has also 
announced that Netanyahu's move will not affect his 
disengagement timetable. 
 
6.  (SBU) As the political dust continues to settle, it is 
already clear that Netanyahu's move has added fuel to the 
anti-disengagement movement.  Right-wing settler leaders are 
already counting on Netanyahu's move to lead to swelling 
numbers at a demonstration reportedly planned for August 11 
in Tel Aviv. 
 
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