Both Kadima and Likud did much better than projected in the last pre-election polls. And Yisrael Beitenu, Labor, and Meretz did unexpectedly badly. The reason for all this is absolutely clear. Once people realized there was actually a tight race between Likud and Kadima (beforehand everyone assumed Likud would win easily), they abandoned the small parties to support either Likud or Kadima - whichever they wanted to run the government.
But while both Likud and Kadima did better than expected, neither did well enough to make a strong coalition. For either party to make a coalition without the other, they'll almost certainly need to enlist both Yisrael Beitenu and a haredi party, probably Shas. Given the bad feelings between those parties (during the campaign Shas' chief rabbi said YB were enemies of God and religion, while YB suggested that Shas members' citizenship be revoked), that does not look like for a recipe for success. I know the almighty dollar (or shekel) can win out over both principles and emotions, but a favor right now is not enough, you'd need to somehow keep the parties off each other's throats until the next elections.
So Kadima and Likud are probably stuck with each other - on what exact terms, it's hard to predict. I think both parties are capable of being bludgeoned by Obama into "peace" agreements which predictably ensure the death of hundreds of Israelis over the next few years. Netanyahu is more against such a policy on principle, but Livni might have an easier job opposing it in practice. The real question is who has the talent and guts to deal with Iran as needed. I certainly don't trust the Kadima hacks and I'm not sure I trust even Netanyahu to make such difficult decisions. One person worth trusting for the implementation is Ehud Barak - witness his successful and complication-free attack on the Syrian reactor. But the defense ministry is the top job except for prime minister, and if Labor is the third party in the coalition they probably won't get it.
So in short I, and probably nobody else, is especially happy with the election results. This is not the first election in which everyone was disappointed, and in recent years many proposals for election reform have been suggested. I plan to share my thoughts on the issue in a hopefully soon-to-be published post.
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