Israel's Leader Struggles to Survive

Prime Minister Olmert hangs on to his job despite a money scandal and polls favoring resignation.


Israeli Prime Minister Ehud Olmert

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JERUSALEM—It seemed that Israeli Prime Minister Ehud Olmert wouldn't be able to go on after Tuesday's court deposition. For seven hours, an at times tearful Morris Talansky, a 75-year-old Long Island businessman and fundraiser, told of playing bagman to Olmert for some 15 years during the politician's rise to the premiership.

Estimating that he'd given Olmert $150,000 in envelopes stuffed with cash along with credit card transactions, Talansky, the key witness in this fifth, most damaging corruption probe of Israel's premier, said the money helped finance not only Olmert's political campaigns but his luxurious lifestyle as well, including first-class plane tickets, fancy hotel suites, and a vacation in Italy. "I only know that he loved expensive cigars. I know he loved pens, watches," Talansky told the court.

Yet Olmert, who denies using Talansky's money for anything but campaign expenses, is going on. "There are those who believe that every opening of an investigation requires a resignation. I don't think so, and I do not intend to resign," he said during a meeting with Israeli mayors. The 62-year-old premier, whose term ends in November 2010, has promised to resign if indicted, but he seems determined to fight back his political rivals' plans to force him out, indictment or not—and so far, Olmert's determination seems stronger that theirs.

Two politicians hold his fate in their hands: Ehud Barak, the defense minister and Labor Party leader, and Tsipi Livni, the vice premier, foreign minister, and No. 2 to Olmert in the Kadima party. Barak can bring down the government and force new elections by taking Labor out of the Kadima-led coalition. But he is wary of doing so because, according to consistent polls, he would lose an election badly to either right-wing Likud leader Binyamin Netanyahu or to Livni, if she were to take Olmert's place at head of Kadima. Livni's problem is that while she might get elected, her rivals in Kadima are not inclined to line up behind her in a palace coup.

After Talansky's devastating testimony, Barak and Livni each demonstrated their reticence by offering tepid, noncommittal statements of no-confidence in the premier. So far, neither seems ready to pull the plug—a repeat of their indecisive performance a year ago following publication of a damning report on Olmert's conduct of the 2006 war with Lebanon.

Olmert's standing with the Israeli public is as low now as then; a poll taken after Talansky's deposition—which by law could not be televised but dominated the news—found 70 percent of Israelis wanting him to resign and only 17 percent preferring that he stay on.

Coincidentally—or, as his opponents claim, by design—his diplomatic opportunities have been piling up in the month since the Talansky scandal broke. Indirect negotiations with Hamas for a cease-fire in Gaza have ripened. Peace negotiations with Syria, brokered by Turkey, were announced. A long-sought prisoner exchange with Hezbollah may be in the works. "I will continue to function as prime minister," Olmert vowed, but his ability to function is clearly impaired.

Neither an indictment nor new elections appear likely to materialize soon, if ever. Olmert could beat the odds and survive, as he has before, but whether he does or not, his struggle isn't helping Israel at all.