Likud infighting erupts over Sharon, policies Is the leadership of Netanyahu already compromised

JERUSALEM — Prime Minister Benjamin Netanyahu's fierce battles over personalities and policies in his first days of power could reveal a weakness in his ability to govern.

When Netanyahu presented his government to the Knesset on Tuesday, a full day later than he had hoped, feuding within the Likud Party about hardliner Ariel "Arik" Sharon and the coalition had nearly toppled the Cabinet.

The bizarre Sharon affair came after Netanyahu had haggled since the election with religious and other small parties in an attempt to win a ruling majority coalition.

Some Israeli commentators were beginning to question Netanyahu's leadership skills, as well as his ability to halt Likud infighting.

"Maybe the central problem revealed during the drama of the last few days and destined to accompany Netanyahu during his term is the lack of capacity for decision-making," the New York Times quoted Yediot Achronot columnist Nahum Barnea as saying.

Netanyahu, who was officially sworn in as Israel's ninth prime minister Tuesday night after his government was approved, gave some indication of his direction in both his inaugural address to the Knesset and his policy guidelines, which were published this week.

Although he offered general overtures to Israel's Arab neighbors in his speech, he was severely criticized by outgoing Prime Minister Shimon Peres for lacking specifics, especially with regard to the Palestinian track of the peace process.

Netanyahu locked up his new government Monday after signing coalition accords with three religious parties, the National Religious Party, Shas and United Torah Judaism; the centrist Third Way; and Natan Sharansky's Yisrael Ba'Aliyah Party of immigrants.

The agreements gave Netanyahu more than the 61 seats necessary for a majority in the 120-seat Knesset. His coalition has 66.

But the ugly and sometimes vicious politicking that characterized the coalition-building strained Netanyahu's relations with his own party, leaving a trail of wounded egos and simmering resentment in the senior echelons of the Likud.

Sharon, who claims that it was he, more than any other single politician, who ensured Netanyahu's victory, was denied both the Defense Ministry, his first preference, and the Finance Ministry.

Sharon, indeed, was instrumental in persuading other would-be rightist candidates for prime minister to withdraw from the contest, leaving the field open for Netanyahu alone to challenge Peres in the May 29 balloting.

Later, Sharon succeeded in persuading most of the leading ultra-religious rabbis to support Netanyahu, and to instruct their followers to vote for him.

But as Netanyahu desperately cast about for a portfolio for Sharon, Netanyahu's choice for foreign minister, David Levy, refused to join in a demonstration of solidarity for Sharon. Only at the 11th hour, after the Knesset approved the new government, did Levy join the Cabinet.

Netanyahu ultimately announced a new portfolio created especially for Sharon, the Ministry of National Infrastructures, with responsibility to build roads in the West Bank and Gaza as well as control of Israel's military industries, energy, ports and state-owned lands.

Levy, an experienced Knesset coalition dealmaker, noted that the new portfolio was "cut to fit Sharon's measurements," an apparent quip about Sharon's girth and political requirements.

Sharon had holed up in his southern Negev Desert sheep ranch while Levy negotiated with Netanyahu over the post, and refused to attend the government's swearing in.

Sharon was joined by Likud members Ze'ev "Benny" Begin and Moshe Katsav in having been excluded from Netanyahu's original Cabinet appointments.

Also originally excluded was Dan Meridor, a moderate and a former Likud justice minister whom Netanyahu views as a potential political rival.

None of those Likud officials ever fully acquiesced in Netanyahu's party victory, nor have they hidden their lack of enthusiasm for his leadership.

Begin, who eventually was appointed minister of science, vowed he would not enter Netanyahu's government as long as Meridor was sidelined. In the final analysis, Meridor was appointed finance minister and Tel Aviv stock market prices shot up.

Katzav ended up as tourism minister, a lesser slot than he had hoped to obtain.

Netanyahu's relations with his own party also were strained by his granting nine of 18 Cabinet portfolios to Likud's coalition partners, including:

*Justice: Ya'acov Ne'eman, a Tel Aviv attorney and political outsider.

*Education: Zevulun Hammer, National Religious Party leader.

*Transportation and energy: Rabbi Yitzhak Levy, NRP.

*Agriculture and environment: Rafael Eitan, Tsomet Party leader.

*Trade and Industry: Natan Sharansky, head of Yisrael Ba'Aliyah.

*Absorption: Yuli Edelstein, Yisrael Ba'Aliyah.

*Public security: Avigdor Kahalani, leader of The Third Way.

*Interior: Eli Suissa, Shas.

*Labor and Social Affairs: Eliyahu Yishai, Shas.

And while Yitzhak Mordechai, who was named defense minister, is now a loyal Likud man, he is hardly a veteran party figure. He had retired from the army last year and joined the Likud only eight months ago, winning second place in the party's Knesset list in the Likud primary in the spring.

Other Likud members of the Cabinet are Limor Livnat, communications, and Tzachi Hanegbi, health.

If the political squabbling and maneuvering over appointments showed anything, according to Yoel Marcus, columnist for the daily Haaretz, it was that Netanyahu felt he owed little to his rivals — and not that he was indecisive.

That's because Netanyahu's enemies "never really believed he could win," the Associated Press quoted Marcus as saying. "He humiliated them and showed them who's boss."

On policy issues, meanwhile, Netanyahu, both in his inaugural Knesset speech Tuesday and in the formal Policy Guidelines, accentuated the pragmatic aspects.

Reaching out to Arab countries, he declared his readiness to negotiate with Syria without preconditions, a position the U.S. State Department welcomed.

Netanyahu pledged to negotiate with the Palestinians if the Palestinian Authority observes its commitments to the peace accords.

By denying Sharon the Defense Ministry, Netanyahu was sending a signal that his government would pursue a policy of relative moderation, political observers said.

Still, the new prime minister had not made an explicit endorsement of the Israeli-Palestinian agreements since his election.

Netanyahu's policy guidelines also pledge to retain Israeli sovereignty over the Golan Heights, maintain Israeli control over a united Jerusalem, and earmark resources to develop West Bank settlements.

"You will discover quickly enough," Peres warned Netanyahu in an emotional and at times angry speech Tuesday, "that the policies you espoused in your election platform cannot lead to peace."

Netanyahu's commitment to award the Palestinians self-rule was absurd, Peres said, because the Palestinians already had achieved that as a result of the process launched by the late Yitzhak Rabin.

Pointing at Netanyahu, he said, "I am not embarrassed I walked with Yasser Arafat. And if you are serious about peace, you will, too. You will even hold his hand."

Peres said the new government's "first test" would be the redeployment of Israeli forces in Hebron, and he urged the government to pursue negotiations on a final settlement.

"If you do so, we will support you," said Peres, who also announced that he would continue as head of the Labor Party.

Meanwhile, Palestinians reacted with anger to the new guidelines of the Netanyahu government, saying that it contained too many "no's."

"Sooner or later, these guidelines will be in collision with the reality, and I hope [Netanyahu] will change his tone," said Palestinian official Hanan Ashrawi, who has been appointed to head higher education in the self-rule executive authority.

Netanyahu, in presenting his government, seemed satisfied with his reality. He promised to lead Israel "on a new course" into the 21st century.

"We want a stable and sustainable peace that will endure for our children and grandchildren and not just for tomorrow's newspaper," he said.