First rifts emerge in new israeli coalition over draft exemptionsfor orthodox jews

But on Wednesday, two members of the new coalition expresseddisparate stands. Ultra-Orthodox lawmaker Moshe Gafni warned of a possible "culturalcivil war" if the exemptions are lifted while Foreign MinisterAvigdor Lieberman, who heads a secular party, said there can be no"foot dragging" on the matter. THIS IS A BREAKING NEWS UPDATE. Check back soon for furtherinformation.

AP's earlier story is below. JERUSALEM (AP) — Now backed by a parliamentary supermajority,Benjamin Netanyahu has tremendous room to maneuver on Israel's mostpressing issues: peace with the Palestinians, possible war withIran, and the growing rift at home between religious and secularJews. The stunning partnership with the opposition Kadima party,announced overnight Tuesday just as the nation was expecting him tocall early elections, means the premier — if he so desires— can compromise with the Palestinians without being broughtdown by hard-line nationalists who had controlled his fate. "A broad national unity government is good for security, good forthe economy, good for the people of Israel," Netanyahu declared ata news conference with Kadima leader Shaul Mofaz, his new deputyprime minister.

With his coalition divided over a flurry of domestic issues,Netanyahu had declared in recent days that he would hold aparliamentary election in September, more than a year ahead ofschedule. But as parliament convened late Monday to move towardelections, he and Mofaz were secretly wrapping up theirpower-sharing deal. Israelis were stunned to wake up Tuesday to anew political reality. Netanyahu now heads a 94-member coalition, one of the broadestalliances in the 120-seat parliament in Israeli history —putting him in a strong position to push forward with newinitiatives.

While Netanyahu emerges as a winner in that sense, the outcome isalso a life raft for Mofaz. Netanyahu had been widely expected towin the election by securing a majority of seats for his Likud andthe religious and nationalist parties that are its natural —but pesky — allies. The opposition center-left bloc wasbehind in the polls — and appeared headed toward splinteringinto several medium-sized parties to boot. For Israelis who felt alienated by the Netanyahu government —and they were legion among the country's various elites —there is now the prospect of a more moderate leadership no longerdependent on the extreme right. At the news conference, Netanyahu boasted of bringing "stability"to Israel's volatile political system, where governments rarelyserve their full terms.

The revamped coalition is expected to sitthrough the end of the parliamentary term in October 2013. Together, he and Mofaz pledged an unspecified reform of thepolitical system, to protect the economy and to tackle thecontentious issue of draft exemptions granted to ultra-Orthodox men— numbering in the tens of thousands. The Supreme Court hasordered an end to the exemptions, and divisions between secular andreligious parties over the issue had threatened to tear apart theoutgoing coalition. No longer dependent on the smaller factions, Netanyahu now has farmore leeway to tackle these issues, as well as sensitive foreignpolicy matters such as Mideast peace and the Iranian nuclearprogram. Peace talks with the Palestinians have been frozen throughoutNetanyahu's three-year term due to disagreements over Jewishsettlements in the occupied West Bank and east Jerusalem.

The Palestinians, who claim both areas for a future state, havesaid they won't return to the negotiating table without asettlement freeze. Netanyahu says talks should resume without anypreconditions. Netanyahu vowed to pursue a "responsible peace process," adding:"We are prepared to engage them at any time, any place." While Netanyahu showed no sign of bending Tuesday, he has showntentative signs of change in recent years. Shortly after taking office, Netanyahu abandoned years of hard-lineideology and endorsed the idea of a Palestinian state alongsideIsrael. And last month he adopted a central argument of his opponents insaying peace is essential for Israel because the alternative wouldbe absorbing the millions of Palestinians in the occupied lands anddestroying Israel's Jewish character.

The Palestinians have dismissed Netanyahu's comments as rhetoricand remain deeply skeptical. Nabil Abu Rdeneh, a spokesman forPalestinian President Mahmoud Abbas, voiced hope that the newIsraeli government will "use the opportunity of the widenedcoalition to work to achieve peace with the Palestinian people." The addition of Mofaz, a former military chief of staff and defenseminister who also heads the largest party in parliament, could giveNetanyahu the necessary cover to offer a new initiative. Mofaz, who has also warned about the demographic threat faced byIsrael, said he has "some ideas" on how to move forward with thePalestinians. Mofaz said he favors an interim agreement on borderand security arrangements before resolving other outstandingissues. "This is the direction that the state of Israel should negotiatewith the Palestinians, in order to achieve interim, beforepermanent, agreement," he said.

Likewise, Mofaz has criticized Netanyahu's approach to Iran. Israel, like much of the West, believes that Iran is trying todevelop a nuclear weapon — a charge Iran denies. Netanyahu considers a nuclear-armed Iran to be a lethal threat toIsrael's very existence, and has repeatedly hinted that he isprepared to authorize an attack on Iran's nuclear installations ifhe believes that international diplomacy and economic sanctions arefailing. Last month, Mofaz criticized Netanyahu's tough rhetoric and said itwas actually weakening Israel. He described the Iranian nuclearprogram as a global threat and said Israel should coordinate anyattack with the U.S.

Mofaz's influence could reduce the chances ofa unilateral Israeli strike, at least in the short term. Netanyahu said he has consulted with Mofaz on Iran for severalyears. He said the talks were "very serious" and would continue tobe "serious and responsible." Analysts said the alliance between Mofaz and Netanyahu could form apotent combination on Iran, with Mofaz adding a needed dose ofpublic legitimacy. Reuven Pedatzur, a commentator on military affairs, said Netanyahucan do "whatever he wants" because there is no real opposition.

"Hejust has to convince Mofaz to agree with him," he said. Kadima had resisted joining the government when former ForeignMinister Tzipi Livni was at the party's helm, because she did notthink Netanyahu was serious about reaching a peace deal with thePalestinians. But that hurdle was cleared when Mofaz ousted Livniin Kadima's leadership vote last month. Netanyahu said talks withKadima had gone on for several days but was not more specific.

Mofaz told the news conference that it had been a "mistake" to sitin the opposition. While Netanyahu, who has surged in opinion polls, approached thenegotiations from a position of strength, Mofaz is in a strugglefor survival. Surveys have predicted Kadima would drop to about a dozen seats inparliament if elections were held, from its current 28. The new deal gives Mofaz a year and a half to rehabilitate hisparty, or possibly merge with Likud.

Kadima broke away from Likudin 2005, and many members, including Mofaz, have their politicalroots in Likud. Shelly Yachimovich, head of the opposition Labor Party, said shewas furious over the last-minute reversal, expressing angerparticularly at Mofaz, who was recently quoted as calling Netanyahua "liar," yet found himself awkwardly sharing the stage with theprime minister on Tuesday as his deputy. "I feel revulsion, loathing ... and a sensation that a line hasbeen crossed," she said. Yachimovich is likely to emerge asparliament's new opposition leader.

The news also sidelines political newcomer Yair Lapid, a popularformer TV anchorman who has been faring well in opinion polls.Lapid must now wait until the next election to enter parliament. ___ Follow AP Jerusalem bureau chief Dan Perry at:/perry(underscore)dan Follow news editor Josef Federman at: /joseffederman.

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