Israeli Defence Minister Shaul Mofaz has left Likud to join Prime Minister Ariel Sharon's new Kadima party. ... The prime minister set up the centrist party in order to give himself more room for manoeuvre in seeking a peace deal with the Palestinians. ... Mr Mofaz joins other high-profile Likud figures like Finance Minister Ehud Olmert and Justice Minister Tzippi Livni, as well as former Labour leader Shimon Peres, in defecting to Kadima.
BAD FALLOUT: Because it is a coalition with former-Lefties - like Peres - Sharon's new party MIGHT NOT be aggressive about "de-socializing" the Israeli economy. And the weakening LIKUD makes the prospect of economic reforms EVEN MORE UNLIKELY. Israel DESPERATELY needs to become more Hayekian and less socialist. This is the SECOND most important issue that Israel faces - after survival, which includes: local issues with Arab-Palestinians; dealings with neighboring and nearby Arabs nations -- like Bahrain and the UAE (where the prospects are good), and with bad neighbors like Hizb'Allah and Syria; dealings with non-Arab Muslim nations -- like Pakistan, and.... IRAN'S NUCLEAR PROGRAM. In other words: Sharon's Kadima Party has a VERY full plate and easily ignore the domestic issues. Which would be bad.