A second cease-fire between Israel and the Palestinian Authority (PA) was in danger of collapse before it had even begun to be implemented.

Late on Wednesday, November 1, the two sides agreed to implement the terms agreed at the Sharm el-Sheikh summit, convened by the US last month to end the current violence and return to the status quo.

Israel began to withdraw some of its tanks from Palestinian areas, while Palestinian police instigated a clamp-down against stone-throwing protesters on the West Bank and Gaza Strip. But fighting between the two sides continued throughout Thursday, November 2.

The Islamic militant groups Hamas and Islamic Jihad again rejected a truce, calling for an escalation of the Palestinian Intifada against Israel. A car bomb attack claimed by Islamic Jihad in West Jerusalem killed two Israelis, including the daughter of Yitzhak Levy, the leader of Israel's right-wing National Religious Party, which draws its support from Jewish settlers in the occupied territories.

Israeli Prime Minister Ehud Barak and PA leader Yassir Arafat had been preparing to publicly announce their latest truce, but this was abandoned. Israel declared it was imposing a 24-hour deadline before it decided whether Arafat had the situation under control. Israeli forces shot dead a number of protesters throughout the day, bringing the death toll from more than a month of violence to over 170. There were clashes in Palestinian settlements on the Gaza Strip, with the Israeli army staging a number of missile and rocket attacks.

Despite these difficulties, the Israeli government appears more anxious to ensure that a cease-fire holds than it was previously. Spokesmen said yesterday they believed Arafat was genuinely trying to curb violent protests, with Barak's security adviser Danny Yatom stating, “There is an intention to establish calm on the ground.”

Behind the divisions within Israel

Within Israeli ruling circles there is growing fear that the situation is escalating out of control. On November 1, three Israeli soldiers were killed in gun battles and Barak's government drew up a list of retaliatory measures, including the launching of helicopter rocket attacks on a Palestinian Authority building. Israeli Foreign Minister Shlomo Ben Ami warned that the conflict with the Palestinians was “a war, or, if you prefer, a mini-war.” He continued: “We need to address this issue not as a civilian uprising, but as a military confrontation.”

In the face of such a major escalation of the conflict, negotiations with Arafat were organised—led by former Israeli Prime Minister Shimon Peres, one of the architects of the Oslo Accord between Israel and the Palestinians in 1993.

Israel signed up to the Oslo Accord in an attempt to overcome severe economic and political problems facing the Zionist state. Prolonged isolation and dependence on US sponsorship had a stifling effect on the growth and international expansion of Israeli capitalism. The Israeli economy was plagued by budget deficits and chronic inflation.

Following the collapse of the Soviet Union, the US was increasingly reluctant to continue subsidising the Israeli economy. It no longer needed to rely on Israel exclusively to uphold its interests in the Middle East, given new opportunities to subordinate the Arab regimes to its dictates. As the Gulf War against Iraq confirmed, Egypt, Syria and other Arab regimes were more than ready to do America's bidding. The US demanded that Israel normalise its relations with the Arab regimes, and that required a resolution of the Palestinian question.

The Israeli bourgeoisie, under the leadership of Shimon Peres and Yitzhak Rabin, viewed a negotiated settlement as key to overcoming its economic problems by attracting international capital and opening up trade and investment relations with the Arab countries. It would also enable Israeli corporations to exploit the Palestinian population in Gaza and the West Bank as a source of cheap labour.

Ever since Oslo was signed, however, these plans have been frustrated by right-wing elements within Israel, who view any concession to the Palestinians' demand for a homeland as impermissible. Following Rabin's assassination in November 1995 by a religious extremist, Likud came to power under Binyamin Netanyahu and spent the next three years trying to block a final settlement with the PLO and any recognition of a Palestinian State on parts of the West Bank and Gaza.

Barak's One Israel coalition took office in 1999, on a popular mandate supporting a negotiated settlement with the Palestinians. Even now polls indicate that between 60 and 70 percent of Israelis continue to support a settlement. But despite this widespread public support, Barak has proved incapable of facing down the opposition of the right-wing within the political and military establishment.

He lost his parliamentary majority in the summer, through the defection of three rightist and religious parties opposed to making concessions to the Palestinians. This included Shas, the country's third largest party, which draws its support amongst Oriental Jews and holds the balance of power in the Knesset, with 17 parliamentary seats.

Barak was saved from immediate removal from office only by the Knesset's three-month recess. But Likud and its leader Ariel Sharon have used this time to sabotage any possibility of a settlement with the Palestinians, while preparing to oust the governing Labour Party-led coalition.

Sharon assumed the leadership of Likud after Netanyahu's defeat. He was the architect of the massacre of hundreds of Palestinian civilians in the Sabra and Chatilla refugee camps in Beirut 18 years ago, when he masterminded Israel's invasion of Lebanon. He instigated the present conflict with his provocative September 28 visit under heavy armed guard to the Muslim holy site of the al-Aqsa mosque compound in east Jerusalem.

Barak seeks unity with Likud

Barak's response has been to accede to every demand made on him for an intransigent stance against the Palestinians. He has spent the past several weeks seeking to form a government of national unity with Likud. Having successfully destabilised Barak's government, however, Sharon has responded to his overtures by insisting Barak rule out any return to negotiations. Sharon demanded the right to determine the agenda on security issues and to have a veto over diplomatic initiatives—with new elections within six months, should Barak adopt any initiative he opposes.

Sharon's intransigence reflected his belief that he was in a stronger position than Barak, but even he was not the undisputed master of the situation. He faces a possible leadership challenge by Netanyahu, after corruption charges against the former prime minister were dropped on September 27. On October 24, Netanyahu called the Voice of Israel radio station to effectively rule out his own support for the creation of a national unity government with Barak, and to threaten to take the issue up within Likud's leadership body.

Powerful voices within Barak's Labour party have become ever more dismayed by the outbreak of fighting with the Palestinians, which has already damaged the economy, causing losses estimated at more than $1 billion. Justice Minister Yossi Beilin, Foreign Minister Ben Ami, and Peres, who holds the post of planning minister, went on record to oppose Barak's announcement that he was taking “time out” from the peace process. These figures have opposed Barak's efforts to unite with Sharon.

Beilin said that a national unity government with Likud should not be considered, because the alternative of governing alongside Meretz and Shas had not been explored.

Meretz emerged as a party out of the “Peace Now” movement, which advocates a negotiated settlement with the Palestinians based on the setting up of a Palestinian state. Its chairman, Yossi Sarid, said he could not rejoin the cabinet while there was a pause in the peace process, or if Sharon was brought into the government.

Faced with Sharon's intransigence and opposition within Labour to the concessions demanded by Likud, the talks to establish a national unity government collapsed immediately prior to the Knesset resuming on October 30. Sharon told the media, “We cannot support Barak and his failed government and we will make every effort to replace him.”

Barak was saved from a vote of no confidence because he had obtained a promise of one month of support from Shas. His isolation was manifest, however, in the hostile reception he faced from all sides—Likud members, United Arab List parliamentarians and even from his own party.

The possibility of an end to the present conflict remains slim. There is no indication of popular support among Palestinians for Arafat's latest attempt to bring the conflict with Israel to a halt. Friday saw a demonstration by thousands of Hamas supporters and further clashes with Israeli security forces at Ramallah, Bethlehem and Hebron that left at least one Palestinian dead.

In Israel, the extreme right essentially maintains its hold over Israeli politics, despite the political counterattack being waged by Peres and others. Had Barak united with Sharon, the possibility of reaching an agreement with the Palestinians would have been rendered null and void. But the temporary deal agreed with Shas offers no long-term alternative. Shas leader Eli Ishai warned on Israel's Army radio following the Knesset meeting, “The Camp David understandings are dead.” If Barak tried to revive the Israeli proposals made at the summit, he continued, “he doesn't have a safety net.”

Barak knows he has only gained a brief respite and is still seeking a coalition with Likud. Communications Minister Binyamin Ben-Eliezer said after the October 1 Knesset meeting, “The safety net does not stand in contradiction to the establishment of a national emergency government.”