After a last minute electoral upset, Israeli Prime Minster Benyamin Netanyahu will almost certainly form a new government. What does a fourth term for Bibi mean for Israel, Palestine and the wider region?

Benyamin Netanyahu, already Israel’s longest-serving prime minister, is about to form his fourth government. Two hours before midnight on 17 March 2015, exit polls by Israel’s three main television channels indicated a tie of roughly 27 seats each between his party, Likud, and the opposition Zionist Union.

By the next morning, however, the tally respectively showed 30 to 24, a clear margin of victory for Netanyahu’s party, which grew by 50% compared to 2013. Gambling on a joint list to challenge Netanyahu, the Zionist Union, an alliance of Yitzhak Herzog’s Labor Party and Tzipi Livni’s HaTenuah (‘the Movement’), may have secured significant gains compared to 15 and 6 seats respectively in 2013, but not nearly enough to form a government.

Votes streaming to these two neck-and-neck contenders enfeebled most other parties but pushed to third place a highly improbable party whose constituents have been historically marginalised in Jewish Israeli politics – Israeli Arabs. The four Arab parties had merged to form the Joint List, in order to overcome the barrier for representation in the Knesset, recently raised to 3.25%. Still, the 14 seats it won will fail to make any substantive difference, at least for now.

Horse-trading

In a fiercely contested parliamentary democracy based on proportional representation, even a clear electoral victory must still be followed by horse-trading, capped at 42 days, that would normally bring into existence a governing coalition of a minimum of 61 seats out of the Knesset’s total of 120. In 2009, then Kadima head Tzipi Livni won by a narrow margin the largest number of seats, but it was the runner-up, the current prime minister, who eventually managed to create a governing coalition.

As it stands, there are two probable coaltions. A rightwing nationalist-religious coalition led by Netanyahu’s Likud (30), which would include Naftali Bennett’s Jewish Home (8), the Sephardic ultraorthodox Shas under Aryeh Deri (7), United Torah Judaism (6) and Bibi’s erstwhile campaign partner, the archconservative Avigdor Lieberman (6). This would secure 57 seats – four short of the threshold. Conversely, a center-left coalition encompassing the Zionist Union (24), Yair Lapid’s Yesh Atid (11), Zehava Galon’s Meretz (4), and the Joint List (14) would still be eight seats short of the necessary minimum.

Which is why this makes Moshe Kahlon, the popular head of Kulanu (‘All of us’), Israel’s most powerful politician at this precarious moment. Kahlon only relatively recently split off from Likud, but has stated he would join any coalition that accepts his platform of pocketbook reforms and his singleminded bid for the finance ministry. Should Kahlon’s 10 seats join the nationalist-religious coalition – an almost foregone conclusion – Bibi would have a broad government with 67 mandates. Should Kahlon surprise everyone by looking center-left instead, the latter – with Arab participation – could still carry the day. A third possibility, also extremely unlikely given the way things are going right now, is a national unity government with Kahlon playing third wheel.

Banking right

Like 2013, the elections this time round – brought forward owing to irreconcilable disputes within the previous Netanyahu government – were not about foreign or security policy, but rather about long festering domestic bread-and-butter grievances. But the impact of the new government on the broader outlines of Israel’s foreign policy will matter tremendously.

If Netanyahu’s second government (2009-13) presided over a deterioration of Israel’s international standing, his third government (2013-15) very publicly wrenched to breaking point Israel’s relations with its most important ally, the United States. With Republican prompting, Bibi decided to undercut the White House by directly addressing Congress about the demerits of the emerging Iran deal.

Netanyahu’s domestic constituency was likely as important a target audience as America’s lawmakers, if not more. Hours before the 17 March elections, Netanyahu made a shift that was then widely interpreted as being born out of intensifying desperation. In hindsight, however, it proved a high-risk/high-gain gambit.

Netanyahu publicly backpeddled on the ‘two-states-for-two-peoples’ pledge he made at Bar Ilan University in 2009. ‘If I’m elected, there’ll be no Palestinian state’, he vowed on 17 March. On election day itself, he banked even more sharply right and raised hell by warning that Israeli Arabs, ostensibly funded by foreign governments, were pouring out to vote en masse and ‘twisting the true will of all Israeli citizens.’

More of the same

And so, coalition negotiations pending, it appears we are on the verge of a fourth Netanyahu government. Netanyahu has not yet proven an ability, or perhaps the political will, to dislodge himself from the narrowest possible definition of national security, certainly not with him repeatedly pointing to the looming twin threat posed by the Islamic Republic and the Islamic State. With Bennett and Lieberman, though weakened, still guarding his far flanks, Netanyahu’s new government is unlikely to deviate much from its Israel-vs-the-world mindset, while remaining sanguine about keeping in over four million non-Israeli Palestinians.

Having already ridden roughshod over its US ally on an Iran deal that has yet to reach a conclusion acceptable to Israel, the initial impression is that a fourth Netanyahu government is unlikely to quickly ditch the grosser instruments of statecraft for a more subtle approach.

Meir Dagan, the ailing former head of Mossad, Israeli’s intelligence service, called Netanyahu ‘the person that has caused Israel the most strategic damage when it comes to the Iranian issue.’ More understated, though perhaps no less scathing, was the charge by Yitzhak Ben Yisrael, Israel’s leading military scientist, that Netanyahu’s government had turned on its head the Ben Gurion adage that ‘Gentiles only talk while we Jews do.’

The elections’ final figures look set to entrench Israel’s nationalist-religious camp, even though an empowered Likud also means a greater margin of maneuver for Netanyahu when it comes to intracoalition bargaining, especially with its more extreme members. Having invested so much of his rhetoric – and to be fair, a quantum of effort – in matters of national security, there is something approaching consensus among Israel’s security czars that Bibi has nonetheless brought Israel one step closer in the opposite direction. Having said this, after defying the odds in a close election, Bibi may yet surprise us again.

A version of this article by Open Briefing contributing analyst Kevjn Lim was originally published by openDemocracy on 19 March 2015.