Fraud Scandal Spurs Talks of Election; Finance Minister Takes Leave of Absence

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Byline: Joshua Mitnick, THE WASHINGTON TIMES

TEL AVIV - Finance Minister Abraham Hirchson took a leave of absence yesterday in the face of an expected fraud indictment, marking the latest corruption scandal weighing down the Israeli government.

Coupled with public criticism of the handling of last year's war in Lebanon, the controversies surrounding Prime Minister Ehud Olmert and his allies have spurred talk of new elections barely a year after the government entered office.

The departure of Mr. Hirchson - a close political ally of Mr. Olmert's - also could spur infighting within the prime minister's party, Kadima, which polls show would lose more than half of its 29 seats in parliament in any new election.

"There are symptoms of a critical mass" of scandals and investigations, said Rina Matzliach, the political commentator for Israel's Channel 2 news. "It could very well be that this is creating an atmosphere in which [political parties] will reach an agreed-upon date for elections."

Five members of the Olmert Cabinet - including the prime minister - now face or have endured corruption investigations, and another three coalition legislators have come under similar scrutiny.

The Hirchson scandal also leaves the Israeli treasury without a leader at a sensitive time for the prime minister.

In just a few days, Mr. Olmert's government is expected to come under harsh criticism from a panel commissioned by the prime minister to look into his government's performance during its inconclusive monthlong war against Hezbollah.

So deep is the disillusionment with Mr. Olmert that he is likely to be disparaged no matter what the panel's conclusions.

If the panel's reproach of the prime minister is abrasive enough, it will encourage some politicians to demand that he step down. But if the conclusions seem to absolve Mr. Olmert of responsibility for the war's failures, critics will dismiss the monthslong inquiry as a whitewash.

"The X factor is, 'What is this panel's conclusion about the management of the government last summer?' " said David Makovsky, a fellow at the U.S.-based Washington Institute for Near East Policy. "This could be the death knell of the government."

Mr. Hirchson's woes came to a head as Israeli press and broadcast outlets reported over the weekend that the Israeli police think enough evidence is available to indict him on charges that he embezzled money as chairman of a public-sector labor union. …