Fiascos bracket Olmert’s tenure

Two vivid images define Ehud Olmert’s scandal-shortened tenure as Israel’s prime minister.

The first, a poster displayed all over the country, showed the faces of two Israeli soldiers captured by Lebanon’s Hezbollah guerrillas and of another held by Hamas militants in the Gaza Strip. “Thy children shall come again to their own border,” the poster read, a hopeful biblical scripture but a blunt reminder of Olmert’s wartime failures.

The second was a word picture drawn by an American financier who testified in court to bankrolling Olmert’s exquisite tastes: fine cigars and Montblanc pens, first-class flights and five-star suites, a designer watch and an Italian vacation.

Olmert’s decision Wednesday to resign next month sealed his legacy as a symbol of the country’s weakened defenses and blatant official corruption. Wounded politically and militarily in Gaza and Lebanon two summers ago, he was finished off at home by dramatic allegations of bribery, fraud and breach of trust.

The impact of his leadership on Israel and the Mideast, however, is broader and more complex. It remains to be seen whether his diplomatic ventures will ultimately lead to a calming of regional tensions.

Olmert, 62, helped engineer a historic realignment of Israel’s politics by leading the rise of a centrist party that accepts the creation of a Palestinian state. More than any other mainstream Israeli politician, he admonished his compatriots to give up parts of the Holy Land, even neighborhoods of Jerusalem, in order to maintain a Jewish majority within the borders of a smaller Israel.

After years of stalemate, he set in motion a series of negotiations aimed at curbing threats along the nation’s borders while overseeing a period of economic prosperity and declining unemployment.

Yet he undermined the most promising of his peace initiatives, with the U.S.-backed Palestinian Authority, by allowing the expansion of Jewish settlements on West Bank land claimed by the Palestinians for a future state.

In doing so, he defied the Bush administration and weakened his Palestinian negotiating partners. But he strengthened Israel’s hold on disputed territory in and around Jerusalem while keeping a broad multiparty coalition intact.

“Olmert was a contradiction,” said Yossi Alpher, a former Israeli negotiator who co-edits bitterlemons.org, an online forum for Israeli-Palestinian discussion. “At a declarative level he seemed to understand that Israel must divide the land. But he couldn’t act. He was trapped by the hawkish elements of his coalition.”

As a caretaker prime minister, Olmert will try to keep those talks alive and bequeath a flurry of regional diplomacy to his successor.

The prospects are good. Secretary of State Condoleezza Rice plans to return to the Mideast this month to keep working with Israeli and Palestinian Authority negotiators. Hamas, the Islamic militant Palestinian group that runs Gaza, appears interested in upholding a month-old cease-fire and getting many of its prisoners freed in exchange for captured Israeli soldier Cpl. Gilad Shalit.

The peace talks Olmert launched with Syria, through Turkish mediators, enjoy the backing of Israel’s military and could progress further if the next U.S. administration supports them as well.

But the survival of his peace agenda depends too on the cohesion and direction of Kadima, the centrist party that Olmert helped his mentor, Prime Minister Ariel Sharon, start in 2005 by breaking away from the right-wing Likud.

Sharon’s debilitating stroke thrust Olmert unexpectedly into the top job. As acting prime minister, he managed Kadima’s victory in the March 2006 parliamentary elections and won a four-year term. Until that breakthrough, Israel’s politics had been sharply polarized between the dovish Labor Party and the hawkish Likud.

Under Olmert’s guidance, however, Kadima has shown ideological strains that could break it apart.

Foreign Minister Tzipi Livni is running for party chairman in a Sept. 17 primary against Shaul Mofaz, a more hawkish former defense minister. Olmert says he’ll resign after the party vote, allowing the winner an opportunity to form a new government.

If the next Kadima leader fails to do that, a general election will be held and probably will be won by former Prime Minister Benjamin Netanyahu, the Likud leader and a critic of Israel’s peace negotiations.

It was Olmert’s stunning setback at the hands of Syrian-backed Hezbollah guerrillas in Lebanon two years ago that propelled his peace overtures to Syria and the Palestinians. Hezbollah’s feat in holding off Israel’s military for 34 days emboldened Hamas to increase its paramilitary arsenal in Gaza and step up its rocket attacks on southern Israel.

The two gravely wounded Israeli soldiers captured at the start of the Lebanon war came home in coffins last month in a swap for five Lebanese prisoners, bringing some closure to the conflict.

“But the aftereffects of the war are very much with us,” said Uriel Reichman, a Kadima party member. “Olmert leaves behind grave damage to Israel’s power of deterrence in the region and a feeling of demoralization and lost hope at home.”

To be fair, Israel’s border with Lebanon has been quiet since the war. And Israel reasserted its strength last year by bombing a suspected nuclear facility in Syria.

Olmert will have a harder time salvaging his honor from the taint of scandals that are likely to be his darkest legacy.

Though not charged with any crime, he faces allegations that in previous public positions he took tens of thousands of dollars in bribes in cash-stuffed envelopes; used his office to benefit cronies and get a discount on the price of a home; and billed multiple state agencies and charities for the same flights, using the extra money to pay for family vacations.

Although Israel’s four previous prime ministers faced ethics complaints over their dealings with foreign donors, the outcry over Olmert was unparalleled, reflecting a growing popular disgust with corruption.

One sign of the repercussions is the fact that that Livni’s reputation for honesty has boosted her in the polls as the favorite to lead Kadima.

“If it is possible to find a positive side to the Olmert scandals,” said an editorial in the newspaper Haaretz, “it is the hope that they will serve as a point of departure for preventing future embarrassments at the highest levels of the Israeli government.”

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boudreaux@latimes.com