Israelis Set to Deliver Judgment on Netanyahu in Pivotal Vote

(Bloomberg) -- Israel's Benjamin Netanyahu faces the political fight of his life Tuesday when voters decide whether to endorse his muscular brand of nationalism or toss him out of office to battle corruption allegations that have tainted his latest term.

Netanyahu, who could become his country's longest-serving leader in July if he wins a fifth term, faces a tough challenge from an ex-military chief who has the security credentials prized by Israelis and a clean-hands image, but lacks the political experience the prime minister has accrued in a combined 13 years in office. With polls showing his Likud party in a tight race with Benny Gantz's Blue & White bloc, Netanyahu has waged a bruising campaign, painting the centrist candidate as a weak leftist while wooing right-wing voters with a promise to annex parts of the Israeli-occupied West Bank.

“You could argue it is a national referendum on Netanyahu,” said Jonathan Spyer, fellow at the Jerusalem Institute for Strategic Studies. “You see this in the main opposition party, Blue & White, that is a gathering of people, many of whom have nothing in common in terms of policy but what they have in common is they don't want Netanyahu to be prime minister any more.”

Regional Ripples

The election result could ripple across a volatile region. Peacemaking with the Palestinians has stalled under Netanyahu's watch; instead he opted to improve Israel's ties with Gulf Arab states by leveraging a shared distrust of Iran. Gantz, a 38-year military veteran, has talked vaguely about “separation” from the Palestinians and hasn't uttered the term “statehood,” yet he's signaled he'd make more effort to restart peace talks.

A U.S. peace plan, which the Trump administration says will present new solutions to break the impasse, is expected to be unveiled shortly after the election. Whoever emerges as Israel's next premier will also have to address the efforts of regional foe Iran to expand its military presence in neighboring Syria, as well as recurring confrontations with the Palestinian militant Hamas group, which runs the Gaza Strip.

About 6.3 million people are eligible to vote for the 120-member parliament, or Knesset. Final results will be announced Thursday, and a week later President Reuven Rivlin will assign a party to build the next coalition. That task won't necessarily go to the party with the most seats, but to the one deemed best able to form an alliance of at least 61 Knesset members. If Netanyahu manages to secure a fifth term, he's poised to become Israel's longest-serving leader in July, surpassing founding father David Ben-Gurion.

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Complicating the outcome is the relatively large number of parties that are in parliament but won't necessarily win enough votes to make it into the legislature next time. That's made it difficult to predict how potential coalition governments could shape up.

The campaign has been overshadowed by Attorney General Avihai Mandelblit's intention to charge the 69-year-old Netanyahu in three graft cases, pending a post-election hearing. Netanyahu says he's innocent and will only stand down if convicted.

Yet even the corruption cases may not be enough to sink the politician known as “the magician.” Polls initially showed Blue & White leading Likud by as many as 10 seats, but the gap narrowed as election day neared. All the while, Netanyahu's base stood strong, accepting his claim that the graft probes were fabricated by opponents who can't defeat him at the ballot box.

Just ahead of polling, Netanyahu pitched for right-wing voters who might be tempted to back other nationalist factions, suggesting he could annex Jewish settlements in the West Bank, which Palestinians want as the heartland of a future state.

Fending Off Pressure

For his supporters, Netanyahu has offered strong leadership in a combustible region. He enjoys warm relations with President Donald Trump, who's delivered him jackpots like withdrawing from the Iran nuclear deal, recognizing Jerusalem as Israel's capital and recognizing Israeli sovereignty over the Golan Heights.

Israel's economy grew nearly 75 percent during Netanyahu's decade in power, expanding even during the global recession, though the gains haven't done much to close the gap between rich and poor.

But it's on issues of war and peace where Israeli leaders make their reputations, and here, Netanyahu's combative policies have delighted right-wing backers.

Netanyahu's government recently adopted a law that defined Israel as the Jewish homeland while contentiously omitting mention of equality for Arab citizens, who comprise a fifth of the population and whose rights are enshrined in other legislation. He's established warm ties with like-minded nationalists in Poland, Hungary and Brazil who've emerged as strong defenders of Israel.

If he wins, allies could try to enact legislation protecting Netanyahu from prosecution as a sitting leader. Either way, another term could bring as much instability as continuity, with the prime minister preoccupied with battling to clear his name and fending off pressure to resign.

--With assistance from Gwen Ackerman.

To contact the reporter on this story: Amy Teibel in Jerusalem at ateibel@bloomberg.net

To contact the editors responsible for this story: Lin Noueihed at lnoueihed@bloomberg.net, Mark Williams, Michael S. Arnold

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