A national unity government appears increasingly likely as envoys from the Likud and Labor parties work to overcome some snags in negotiations.
Both Prime Minister-elect Ariel Sharon and outgoing Prime Minister Ehud Barak appear determined to forge a unity coalition that will remain in power until the end of the Knesset's term in November 2003.
The Palestinian rejection of President Clinton's peace proposals has made it relatively easy for Israel's two major parties to set aside their differences over the shape of a final peace deal and agree on a platform vague enough for each to accept.
Israeli-Palestinian tensions escalated further following Wednesday's car bomb attack near Holon. Four female soldiers, three male soldiers and a civilian were killed and 17 other people were injured when a Palestinian driver slammed his bus into a crowded bus stop.
According to leaks from the two parties, they have so far agreed to the following guidelines for a unity government:
It will be committed to advancing a peace involving "painful compromises" by both Israel and the Palestinian Authority;
It will be bound by previously signed agreements, but not by proposals considered during negotiations that fell short of an accord;
It will work toward interim peace deals with the Palestinians, rather than the comprehensive agreement sought by Barak and insisted on by the Palestinians; and
It will not build new settlements in the West Bank and Gaza Strip, but will allow existing settlements to expand in line with "natural population growth."
Potential pitfalls in the negotiations were avoided by vagueness and omission on key points.
As a result, there is no specific reference -- at least in the leaked versions -- to the future of Jerusalem's Arab neighborhoods. Likud officials had demanded an explicit commitment to keep the entire city under Israeli control.
Nor is there a call to dismantle isolated settlements. Labor had wanted this, but the pro-settler National Religious Party has threatened not to join a unity government if such provisions are included, and the Likud does not want to lose any of its "natural partners."
By midweek, the unity negotiations had slowed somewhat. In part, this slowdown was due to Barak's demand that the government's platform say that Israel will agree to the creation of a Palestinian state.
In the past, Sharon has said that he would not oppose a Palestinian state but has set conditions for such a state that Labor does not accept.
If a unity government is established, it seems likely that the cabinet will contain eight Likud and eight Labor ministers, along with some 10 other ministers from the religious and rightist parties and from the Russian immigrant Yisrael Ba'Aliyah Party.
Some Laborites raised their eyebrows when the defeated prime minister insisted on running the party's negotiations with Likud, just days after he told the nation that he would leave the Knesset and resign as Labor leader when Sharon took office.
The eyebrows climbed even further when it emerged that -- his resignation notwithstanding -- Barak was considering an offer to be Sharon's defense minister.
That exacerbated the tension between Barak and Labor's elder statesman, Shimon Peres. Peres is still fuming over Barak's refusal to step down during the campaign to allow Peres to represent Labor.
Looming over the negotiations is the shadow of former Prime Minister Benjamin Netanyahu, who remains the most popular politician in the country, according to polls.
A key Netanyahu supporter, Likud legislator Yisrael Katz, convened a meeting of Likud Central Committee members this week to protest Sharon's offer of the defense portfolio to Barak. Katz argued that Barak already has proved a total failure in the post, which he held simultaneously with the premiership.
The real reason, political commentators said, is that Katz, and presumably Netanyahu, believe a Sharon-Barak partnership would have a good chance of staying in power for the rest of the Knesset's term.
Political commentators say Sharon and Barak are bound by a common desire to thwart any potential Netanyahu comeback.
Of course, that desire won't make it into a unity government's policy platform. But it will nevertheless be there, commentators say, between every line.