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The Impending Obama-Netanyahu Showdown

While the U.S. president and the Israeli prime minister no longer openly clash, Netanyahu has to wonder how the U.S. president will behave if elected to a second term.
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Israeli governments often have collapsed before their term ended. Benjamin Netanyahu's government is doing something almost unheard of in Israel: voluntarily scheduling an election much earlier than necessary. Elections were not due until 2013. It seems very likely they will be held on September 4 of this year instead.

Why this move?

Netanyahu's actions seem impelled by three reasons:

1) The economy, stupid!

In a depressed world economy, Israel's economy is thriving. The discovery last year of a huge gas field off Israel's coast has enhanced the good mood. But an alert politician can see risks ahead. The EU is Israel's largest trading partner. What if the Eurozone slumps deeper into recession? Next year, the Israeli electorate may not be so disposed to re-elect its prime minister.

Last summer's protests against the high cost of living in Israel were allayed by promises of reform in the real-estate market. But there's no quick fix to the problem, and by next year, middle-class Israelis may have lost their patience. Another reason to go to the polls early.

But the economy is the least of Netanyahu's concerns. A more pressing reason for an early election is:

2) The Iran showdown

Sanctions on Iran are biting hard. The European Union, Japan, and even India are diversifying their oil purchasing away from Iran. The Kirk-Menendez sanctions enacted by the United States at the end of 2011 will cut Iran off from the international payments system.

The Iranian currency has collapsed: Over the past six months, the rial has lost half its value against the U.S. dollar. Food prices are rising at 50% per year. Unemployment is estimated at about 15%.

Former Iranian commerce minister Jahangir Amuzegar concludes in a recent report for the Carnegie Endowment: "[Iran's] economy is now more state dominated, more oil dependent, and more vulnerable to external events than ever before. The loopholes, furthermore, that helped Iran avoid sanctions in the past are quickly closing up. Absent a quick, even if temporary, agreement on the nuclear issue, Iran is likely to face an intolerably hot summer soon."

Note the key phrase, "absent a quick agreement on the nuclear issue." Iran badly needs a nuclear deal now. After years of intransigence, Iran has begun signaling a new willingness to negotiate. The question is: Will those negotiations be real and productive or -- as the Iranians must hope -- delusive and manipulative?

Israel rightly fears that its allies may accept a face-saving, temporary agreement that ignores the key issues. If Nicholas Sarkozy loses re-election in France this weekend, Israel will lose one of its best allies in Europe on the Iran issue.

Barack Obama, meanwhile, has always stressed his opposition to an Iranian nuclear weapon -- raising fears in Israel that Obama might accept a deal that ratified Iranian nuclear capacity.

As negotiations with Iran intensify this fall, Netanyahu will want the strong domestic mandate that comes from having his re-election just behind him, not looming a few months in front of him.

Which leads to a final motive for a 2012 Israel election:

3) The impending Obama-Netanyahu showdown.

The U.S. president and the Israeli prime minister no longer openly clash, as they did in the first year of the Obama presidency. The relationship has improved to the point where it is correct, if not cordial. But Netanyahu has to wonder how the U.S. president will behave if elected to a second term.

During Netanyahu's first premiership, then-President Bill Clinton blatantly intervened in internal Israeli politics, strongly signaling to Israeli voters that he would prefer a different Israeli leadership. Netanyahu's political opponents hired pollsters, ad agencies, and message gurus with strong links to the U.S. Democratic party. In 1999, Netanyahu lost the premiership to Ehud Barack.

Does Netanyahu anticipate similar meddling from a re-elected President Obama? This time, Netanyahu would be less vulnerable: Obama is far less popular in Israel than Clinton was. Still, why take chances? If re-elected in September 2012, Netanyahu's government would be extended into the fall of 2016 -- running out the clock on any hopes Obama might have of circumventing and outlasting Netanyahu.

That looks like the idea, anyway.

This blog is cross-published at the National Post.

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