WORLD> Middle East
Israeli defense chief says Olmert must step down
(Agencies)
Updated: 2008-05-29 10:09

Olmert's other option is to resign. If that happens, his government falls and Israel's ceremonial president, Shimon Peres, would select a lawmaker from Kadima, probably Livni, and give her a chance to form a new government without new elections.

In recent months, Livni has emerged as one of Israel's most popular politicians. If she takes over from Olmert, she would become Israel's second female prime minister, after Golda Meir.

But Livni faces other rivals for the Kadima leadership who will certainly try to oust her once Olmert is gone. With no one else in a strong position to form a majority coalition in the fragmented 120-seat parliament, that would likely set the stage for new elections.

Livni and other Kadima leaders remained conspicuously silent Wednesday, although one junior Kadima lawmaker, Amira Dotan, urged Olmert to resign.

"Kadima is in a leadership crisis that has to be solved," she said.

Olmert is the latest in a long line of Israeli leaders plagued by scandal. Former Prime Minister Ariel Sharon was accused of campaign funding violations, as was Barak himself when he was prime minister in 2000. Israeli President Moshe Katsav was forced to resign in June 2007 under a cloud of rape and sexual assault charges.

With US backing, Olmert and Palestinian President Mahmoud Abbas have set a year-end target for forging the outline of a final peace deal. Last week, Olmert also said he was resuming peace talks with archenemy Syria after an eight-year break.

With Olmert embroiled in scandal, however, and the prospect of a Netanyahu government down the road, peace prospects are suddenly murky.

In a statement, Abbas said he considered the matter an internal Israeli issue. "We deal with any Israeli government that commits to the peace process." Abbas's aides, however, say they are worried about the effect Olmert's woes will have on peacemaking.

In Israel, Talansky's dramatic courtroom testimony painting Olmert as a money-loving politician with a fondness for the good life dominated Wednesday's headlines. Olmert's lawyers are scheduled to cross-examine Talansky on July 17.

The testimony exposed a dark side of the close alliance between Israeli leaders and wealthy American Jews.

Many US Jews donate to Israeli charities and causes, and some -- like Talansky -- go further, giving directly to Israeli politicians or political movements they identify with.

Israel is a small country where fundraising opportunities are limited, and some politicians have found that Israel's supporters abroad are a potentially lucrative alternate source of money. Foreign donations are not illegal, but prosecutors suspect Olmert may have exceeded legal limits or even accepted bribes.

Talansky, 75, said he never received anything in return for the money. He said he was motivated by an admiration for Olmert.

Commentators said that while there was no clear evidence of criminal activity, the moral implications were troubling. In a headline, the Yediot Ahronot daily described Olmert's high-flying lifestyle as "disgusting."

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