Netanyahu faces coalition walkout over row with US
Domestic pressure was building yesterday on Benjamin Netanyahu, Israel's prime minister, to resolve his country's row with America, after the Labour Party threatened to leave his ruling coalition and President Shimon Peres criticised him over settlements in East Jerusalem.
Amid growing signs that Mr Netanyahu and his right-wing allies would defy US demands to curtail construction in the area seen by Palestinians as their future capital, Labour cabinet ministers said they would meet next week to "re-examine" their participation in the government.
The warning reflected some Israelis' growing disquiet over Mr Netanyahu's handling of a worsening diplomatic crisis with America that was provoked by a decision earlier this month to build 1,600 homes in one of East Jerusalem's Jewish settlements.
Although a narrow majority of Israelis support continued Jewish construction in the area, many are alarmed at the rapid deterioration of their country's relationship with its closest ally.
Labour urged Mr Netanyahu to re-constitute his coalition by inviting the centrist Kadima Party into government at the expense of his more radical partners on the right.
As the threats to his coalition grew, Mr Netanyahu held a secret meeting with his inner cabinet to formulate a response to a series of demands made by President Barack Obama last week, the thorniest of which relate to East Jerusalem.
But with four of the seven-man inner cabinet holding hawkish pro-settlement views, Mr Netanyahu has shown little inclination to accommodate the American president.
According to Israeli media reports, inner cabinet hawks vehemently oppose the demands made by the Obama administration, which was accused of "hostility" to Israel and whose policies were denounced as "diseased and insane".
Mr Netanyahu released a statement distancing himself from such views.
Yet on the question of building in East Jerusalem, the prime minister has undoubtedly chosen to align himself with the radicals in his government rather than with the moderates.
Were Labour to leave the government, Mr Netanyahu's coalition would retain a two-seat majority in the Knesset, Israel's parliament.
But were he to make any concession on any settlements, he risks losing the support both of Yisrael Beitenu, a nationalist party, and Shas, a religious movement.
Such a move could see Mr Netanyahu forced from power.
Mr Netanyahu also has deep ideological differences with Ehud Barak, the defence minister who leads Labour.
The two men have a long-standing rivalry that dates back to their army service in the same unit.
Mr Peres is reported to have told Mr Netanyahu that he was partly responsible for the crisis with the United States by ignoring a 40-year-old policy not to build in Arab areas of East Jerusalem.
Although Mr Netanyahu's predecessors have expanded Jewish settlements in the east of the disputed city -- a policy supported by Mr Peres -- they had avoided building Jewish homes in its Arab suburbs.
A cabinet minister in Mr Netanyahu's government yesterday threatened to "liquidate" the Hamas leadership in Gaza after two Israeli soldiers were killed during a clash with gunmen from the Islamist government on Friday. (© Daily Telegraph, London)