Netanyahu juggles ideology with deal-making

John Lichfield considers the way ahead for the new Prime Minister

After Binyamin Netanyahu won the Israeli election in May, the commonest domestic complaint, voiced even by many who had voted for him, was: "We don't really know who he is or what he is going to do." Today Mr Netanyahu will have been Israel's Prime Minister for 100 days. Many, inside Israel and outside, are still asking the question: Who is Netanyahu? What does he want?

The Israeli Prime Minister is touring Europe to sell the idea that his coalition of right-wing and religious parties has changed but not destroyed the peace process. Yesterday, he told the BBC Radio 4 Today programme that his tougher approach offered a better prospect of lasting peace. Both propositions are doubtful. The exchange of gunfire between Israeli and Palestinian security forces which left four dead near Ramallah yesterday could be a warning of more serious confrontations to come.

In essence, after three months in office, Mr Netanyahu's government is still in a holding pattern, offering sops to both sides. He has not thrown over the Oslo peace process; but he has pursued it so limply that it is hardly a process any more. Despite an early campaign promise (later fudged) never to meet "that man", Mr Netanyahu agreed, under US pressure, to meet Yasser Arafat this month. And yet when they did talk, he had nothing specific to offer on the burning issues.

Mr Netanyahu has marginalised the most hawkish members of his cabinet, Ariel Sharon and Benny Begin, but he has given Mr Sharon virtually a free hand to expand Israeli settlements and bypass roads on the West Bank.

It was Mr Netanyahu's personal decision this week to appease his right- wing critics and reopen a controversial, old tunnel near Islamic holy sites in Jerusalem which provoked yesterday's violent demonstrations in Ramallah and protests elsewhere in the West Bank. It is difficult to see why the tunnel itself should generate such fury. But the mood of the West Bank has been inflamed by a series of decisions to expand settlements and roads and by the lack of movement on Hebron.

One interpretation is that there is nothing new about Mr Netanyahu's approach; that he has reverted to the obstructionism of the last Likud government. Mr Netanyahu is a Yitzhak Shamir in a smarter suit and an American accent, a temporiser who has no intention of making real concessions to the Palestinians. When he speaks of peace in the Middle East, what he really means is peace and quiet for Israelis.

But this does not quite fit the known facts. Much has changed since Mr Shamir was in power. Mr Netanyahu accepts that there is no returning to the days when Israel tried to hold down the entire Palestinian population by force. He has reportedly been impressed with the efforts made by Mr Arafat to restrain Hamas and prevent attacks on Israel. It is said that he now accepts the need to make concessions to Mr Arafat to help sustain his old enemy's prestige and authority. A compromise on Hebron has been virtually wrapped up by the Israeli Foreign Minister, David Levy (extending the areas over which Israel will retain military control). But Mr Netanyahu flinched from announcing the deal at his meeting with the Palestinian leader (calculating that the meeting itself would get him into sufficient trouble with the Right).

Mr Netanyahu is, in his gut, a deal-maker, but he leads an ideological party in a very ideological coalition. He does not know how to square this circle; so he feels his way forward by political instinct. This may not be sustainable for much longer. He has made three principal promises to the electorate - peace, security and prosperity - which threaten to bump into each other.

Yesterday's incidents near Ramallah menacingly illustrate his problem. Going slow on the peace process threatens to generate violence which disturbs the sense of security of Israelis and threatens to destabilise business confidence and terminate the peace-led Israeli economic boom. Western governments believe that the overwhelming logic of this situation should push Mr Netanyahu more and more to deal with Mr Arafat.

The immediate question is whether he will feel able to make enough concessions to put some kind of peace process back on track and calm the anger in the West Bank. The worst-case scenario is a spiral of confrontation and violence; the best-case is that Mr Netanyahu will keep the peace process bumping along until the real crisis-point some time next year.

The crunch will come when Mr Netanyahu's deal-making instincts collide with his ideology on the big-ticket issues - the future of Jerusalem; the drawing of the final map of the West Bank and the status of the Palestinian- controlled areas.