General’s Stock Dump Fuels Anger Over Wartime Trio

By J.J. Goldberg

Published August 18, 2006, issue of August 18, 2006.
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JERUSALEM — When Israel went to war against Hezbollah on July 12, the nation seemed united behind its leaders in a common sense of mission the likes of which had not been seen in decades, all observers agreed. Five weeks later, after 157 Israeli deaths, 1000 Lebanese deaths, 4,000 Hezbollah rockets and one United Nations cease-fire, the national unity is still there, but its focus has shifted. Now it’s directed against Israel’s leaders.

Israelis of every rank and political hue were angrily ticking off the same list of outrages and foul-ups this week, from a bungled air war to a ground offensive that began too late, from reserve combat units sent to fight without helmets or drinking water to a battered home front left largely to fend for itself, and finally to an inconclusive cease-fire that may leave the Hezbollah terrorists free to strike again. Prime Minister Ehud Olmert declared to the Knesset this week that Israel had won the war on points, but most of the public wasn’t buying it. The conclusion seemingly on everyone’s lips, from politicians to cabdrivers, was that heads would have to roll at the top — sooner rather than later.

“I don’t see how they can survive,” a ranking Knesset member in Olmert’s ruling coalition told the Forward. “Things went terribly wrong, and somebody will have to be held accountable.”

“It feels as though they’re all on drugs,” said a West Bank settler rabbi known for his moderate views.

The only question was who would go down first: Olmert, the inexperienced commander in chief? His rookie defense minister, Amir Peretz, the former trade union boss? The war’s main architect, Lieutenant General Dan Halutz?

The answer may have come sooner than anyone expected. In a bombshell report this past Tuesday, August 15, the daily Ma’ariv newspaper disclosed that Halutz, the military chief of staff, had liquidated his entire personal stock portfolio on the morning the war started.

Halutz insisted the sale had been planned earlier and had nothing to do with the unfolding military crisis. Legal experts opined that he hadn’t violated insider-trading or other securities laws. To the public, however, the news landed like a rocket barrage. The crisis, observers recalled, began with the kidnapping of two soldiers July 12 at 9:00 a.m. Halutz called his broker at noon. The kindest reading was that the country’s top general had shown colossally bad judgment, taking time to call his broker while the security cabinet was in emergency session and the nation was sliding toward war. At worst, it was seen as a betrayal: A traumatized nation, struggling to recapture its shaken faith in its defenders, woke up to find that its chief defender seemingly lacked faith in the nation’s future. The story swept all other news aside in this news-hungry nation.

Labor Party lawmaker Colette Avital was the first to call for Halutz to resign, charging poor judgment. “The state was burning, and all that interested Halutz was his investment portfolio,” she told reporters. Others were harsher. “It’s as if the man who is supposed to symbolize the security of Israel wasn’t secure himself in the ability of the Israel Defenses Force to deal with the crisis,” said Knesset member Gilad Erdan of the opposition Likud. Halutz was already in the line of fire before the stock scandal broke. A former Air Force commander who became military chief a year ago, he is seen as the main advocate of a quick and easy air war in the first days of combat, a fruitless strategy that’s now believed to have delayed the all-important ground assault by precious weeks. Critics had been charging for months that Halutz filled too many top General Staff posts, including military intelligence, with Air Force cronies, weakening the ground command and distorting the army’s perspective. “These are guys who spent their entire military careers in air-conditioned cockpits, who never spent a night in the mud waiting for the command to move,” political commentator Ben Caspit wrote in Ma’ariv in early August, midway through the war.

Even if Halutz is forced out, however, the political leadership — beginning with Olmert and Peretz — can hardly breathe easy. Some of their closest allies now say it was a mistake for Israel to put its fate in the hands of a pair of politicians with no military background. Three formal inquiries have been launched already — by the Defense Ministry, the Knesset and the State Comptroller — and a full-scale judicial commission is considered inevitable.

Olmert and Peretz have their defenders. They inherited an army that had been hollowed out by years of tight budgets. One of the main victims of the cuts was the vaunted citizen reserve, which saw its training days slashed and its equipment sheds emptied out to supply the active-duty troops on the cheap. Strategic planners, lulled into thinking foreign ground wars were a thing of the past, had remade the army as an occupation force, trained mainly in policing Palestinian towns.

On top of everything else, former prime minister Ariel Sharon and his defense chief, Shaul Mofaz — now one of Olmert’s and Peretz’s chief critics — spent five years looking away as Hezbollah built up its fearsome stock of Iranian- and Syrian-supplied rockets. Perhaps they were preoccupied with the Palestinian uprising. Perhaps Sharon was afraid to revisit the Lebanon front that had caused him so much past grief. Either way, a massive problem had been dumped on Olmert’s doorstep. When the July 12 kidnapping gave Olmert a casus belli, he grabbed it.

Perhaps the most compelling argument for the survival of Olmert and Peretz is the numerical one. Their center-left coalition commands 66 seats in the 120-member Knesset. Another 15 seats to their left, including Meretz and the Arab-led parties, are likely to oppose any bid to replace Olmert from the right. The likeliest challenge will come from Likud leader Benjamin Netanyahu, who can count on just 36 seats of religious and nationalist parties on the right. To have a chance of success, Netanyahu would have to woo close to 20 defectors from Olmert’s 29-seat Kadima faction, a far-fetched scenario.

Olmert faces a few rough months ahead, but unless he is forced out by a judicial inquiry, his job appears safe. That means Peretz is safe, too, because they need each other, however rocky their partnership. “They’re in a position of ‘united we stand, divided we hang.’ They need each other,” Avital, the Labor lawmaker, told the Forward.

Right now, though, nobody is buying stock in Olmert & Peretz. “Sooner or later the public is going to be asking how you can decide to go to war without checking to see whether the army is ready,” said one Knesset member, echoing the complaints of several former generals turned politicians. “Did they ask to see the plan for week one and week two, the best-case and worst-case scenarios, the reports on stockpile conditions? Even in the Six-Day War, after Nasser blockaded Israel’s southern port and forced a war, Israel took three weeks to respond.”

“When somebody says he didn’t know the army wasn’t ready and tries to blame others, the people of Israel aren’t stupid,” said another prominent coalition lawmaker. “Anyone in Israel who tries to pin the blame on the army tends to lose out.”

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