PANIC TIME IN ISRAEL AND FOR "LIBERAL" AMERICAN JEWS

Everything went wrong for Sharon last week, but he is still way in the lead and it is Barak who is desperate.

All the tricks and lies of the Israeli Labor Party have now come back to haunt it. Barak, never a politician, bears the brunt of popular blame for all the political deceptions and tricks that have for so long accumulated. Peres, always the politician, is at this point treated more sparingly; but he too it appears would loose now to Ariel Sharon.

Thus Labor's demise. It really started in the late '70s when Yitzhak Rabin lost out to arch-nemesis Menachem Begin. Then switching power regularly, the Begin years were followed by Yitzhak Shamir, with Labor's top guys sometimes serving as Ministers in National Unity Governments led by the Likud Revisionists.

Now there is the coming of Ariel Sharon, someone most Israelis, and certainly most American Jews, never thought would have a chance of taking power. But then the liberal Germans never expected Hitler and the Nazis to do so either.

The unraveling of the duplicitous "peace" and the coming of Sharon is causing some to even think it just could be the beginning of the end -- read David Hirst's remarkably insightful article that follows later today, "The End of Israel?"

As for Peres' comment -- "I wish I would (be hopeful), but, as I said, we don't have enough time" -- what patent nonsense. Peres -- a disciple of Ben-Gurion who made the fateful decision to estabish a "Jewish State" rather than an all-inclusive "bi-national State" -- has had 52 years to stop the racism, to stop the illegal policies, to stop the deceptions, to stop the killing, and to provide justice to the Palestinian refugees. Having failed on all counts now we are all on the threshold of a new more hateful era of ceaseless communal warfare between Jews and Arabs that shouldn't and needn't have been. And in this new era that they have collectively wrought there are ballistic missiles, nuclear bombs, and biological toxins, not to mention cell-phone bombs.

BARAK IN TROUBLE AS SHARON SOLDIERS ON IN POLLS
By Megan Goldin

JERUSALEM, Jan 26 (Reuters) - Everything that could have gone wrong went wrong this week for Israel's leading hawk, Ariel Sharon, but it barely made a dent in opinion polls that predict he will be victorious in a February 6 election.

Prime Minister Ehud Barak's team waited with bated breath for the latest opinion polls published in Friday newspapers, certain the tide was finally turning in Barak's favour.

Instead the polls predicted Sharon was maintaining his double-digit lead of between 16 to 18 percent despite a series of foul-ups this week in the Likud leader's carefully managed election campaign which included being publicly chided by a schoolgirl who said he was unfit to serve as prime minister.

"It was the worst week ever for Sharon, but despite this we are in trouble," one of Barak's cabinet ministers told the Yedioth Ahronoth newspaper.

Israeli pollster Hanoch Smith said his poll published in the Jerusalem Post newspaper indicated a slight change in Barak's favour, but he said the turnaround was so small and so close to the election that he doubted it would make much difference.

"We do have a little of a shift but it's not enough to say we are having a fantastic reversal," Smith told Reuters. "It's highly doubtful (the gap could close), but it could happen."

Smith said coming from behind at so late a date would be an unprecedented feat for Barak, Israel's most decorated soldier and a former army general who swept to victory in a general election only 20 months ago.

SHARON TRIES TO SHED WARMONGER IMAGE

Sharon has tried to shed the warmonger image he holds in the minds of many Israelis by cultivating a persona as a kindly, grandfatherly figure through a series of school visit where he patted children on the head before television cameras.

But he stopped after a 16-year-old schoolgirl lambasted him on Monday for causing Israeli families to suffer, including her own, by orchestrating Israel's invasion of Lebanon in 1982. The girl's father suffered shell shock from fighting in Lebanon.

Polls in the Yedioth Ahronoth daily also show Barak has taken a beating by agreeing to hold peace talks with the Palestinians in Taba, Egypt, so close to the election despite predictions a deal would boost Barak's chances in the ballot.

Israel's Supreme Court ruled earlier in the week it was legal for Barak's minority, caretaker government to conduct the talks, but the negotiations have nevertheless come under attack and not just from Barak's right-wing opponents.

One of Israel's leading political scientists and a figure with strong roots in the Israeli left, Professor Shlomo Avineri, slammed the negotiations as a violation of democratic norms and said it hurt "the legitimacy of the peace talks."

Despite the bleak predictions and overwhelming odds, Barak was heartened by a mock election at a Tel Aviv high school.

Students at Blich high school in suburban Tel Aviv cast 57 percent of their votes for Barak and only 42 percent for Sharon. The vote would be meaningless except the mock election at Blich has been wrong only once in the last 30 years.

That was when it predicted victory for Shimon Peres in a 1996 race against right-winger Benjamin Netanyahu. Peres lost by a razor-thin margin of less than one percent

PERES SAYS TIME TOO SHORT TO REACH MIDEAST DEAL

DAVOS, Switzerland, Jan 26 (Reuters) - Israeli Minister Shimon Peres said on Friday a deadlock over Jerusalem's status had all but blocked prospects of striking a peace deal with Palestinians before Israeli elections on February 6.

"While the territorial issues were narrowed down to the point where we can almost conclude the issue, the issue of Jerusalem still remains the hard core of the problem and I am not sure that in the available time, which is extremely short, we should be able to solve the problems," he told Reuters Television on arrival at the annual Davos business summit.

He was set to meet Palestinian leader Yasser Arafat for talks on Sunday, but he said Israeli Prime Minister Ehud Barak was not expected to take part.

"I am afraid the calendar will be the most important reference for the future," Peres said when asked if a peace deal was possible before February 6.

Asked if he was hopeful, he answered: "I wish I would (be), but, as I said, we don't have enough time."

SHARON WEATHERS ALL

"SOOTHING MESSAGE" OR "CASINO SABOTAGE"

[Ma'ariv - 25 Jan - by Eldad Bek, Menahem Rahat, Ron Levine and David Lipkin]: The political establishment is in uproar over the secret meeting in Vienna between Ariel Sharon's people -- son Omri, former Foreign Ministry director general Eitan Bentzur and attorney Dov Weissglass -- and Yasser Arafat's economic advisor.

Palestinian and Austrian sources asserted vigorously last night that the meeting focused on the future of the Jericho casino. Prime Minister Barak also hinted at this possibility. On the other hand, Sharon's people denied it vehemently and contended that the meeting was meant to assuage the Palestinians prior to Sharon's becoming prime minister.

Sources close to the Austria Casino company, which operates the Jericho casino, alleged last night that the meeting focused on the future of the casino and the compensation that the government of Israel, headed by Sharon, would be willing to pay the owners for the losses caused them by its closing when the Intifada broke out.

The sources said that the meeting was held at the initiative of the director of the Austria Casino company at the Intercontinental Hotel in Vienna.

These Austrian sources said that senior members of the Austrian company and businessmen who'd invested in the Jericho casino, including Jewish millionaire Martin Schlaff, who refused to comment yesterday, were present at the meeting. The Austrian sources said that Dov Weissglass, Sharon's lawyer, who also represents Schlaff, raised various ideas at the meeting for compensation arrangements that would be paid by Israel. The articipation at the meeting of the PA's economic advisor Mohammed Rashid, these Austrian sources said, was not at the behest of the PA but in his capacity as one of the casino owners. An official Palestinian source in Vienna also said that Rashid is not authorized to conduct any diplomatic negotiation on behalf of the Palestinian Authority, and that "the talks dealt only with the future of the casino, if Sharon wins the elections."

Prime Minister Ehud Barak was sharply critical of the Vienna meeting yesterday. He said this was a "very vexing matter from an ethical aspect." Barak said that "opposition elements should not be conducting negotiations with the Palestinians on the day the two Israelis murdered in Tulkarm are buried." The prime minister also indirectly related to the possible economic aspect of the meeting and said: "The matter is disturbing and perplexing. Who are the figures involved? This is the son of the candidate, the lawyer of the candidate, who also happens to be the lawyer of the businessman broker, who happens to have a thriving business that is dependent on Israeli good will, while the man on the other side is a businessman and not just the economic advisor to the PA. This is tireless political subterfuge."

In an election rally with new immigrants in Ashdod, Barak said: "The State of Israel is not a casino and Sharon must not be given the controls over the State of Israel, perhaps only the roulette wheel."

Countering these harsh accusations, MK Sharon thoroughly denied the charges that his representatives had purportedly conducted diplomatic negotiations in Vienna or dealt in matters concerning the Jericho casino. Sharon associates claimed the Vienna meeting was "meant to calm the Palestinians and to tell them that no war would break out on the day after elections, when the media would proclaim the results."

Sharon himself said yesterday: "There were appeals to us to hold contacts with a representatives of theirs and we consented. There were no negotiations, I am not authorized to conduct negotiations and I have no intention of conducting negotiations because my position on the issue of negotiations is unequivocal -- there will be no negotiations under fire.

"I want to say in the clearest manner possible: there was no talk about the casino, and this is entirely irrelevant. In contrast to Ehud Barak, I do not gamble on the fate of the people. There were no negotiations there, but rather a meeting where they wanted to find out my position directly, not through the media. Arafat also apparently reads the polls."

Sharon also disclosed that he had received appeals from other Arab and Moslem countries, close and far from Israel, asking to speak with him or with his authorized representatives, to clarify his diplomatic positions.

Attorney Dov Weissglass also told Ma'ariv last night that "all the talk about onducting negotiations or opening the Jericho casino are stuff and nonsense.

The word casino never even came up." As for his personal involvement in the matter, Weissglass said: "I have had a close personal relationship with these people for many years. I met them in Ramallah and in Gaza and in European capitals, with their families.

This was not on a political basis but a professional one and we forged warm ties. They asked for me to be present to break the ice, and so it was."

It has been learned that preparations for the meeting began already three weeks ago, following an appeal by the Palestinians to Sharon's headquarters, with a request to send them an authorized representative to explain Sharon's positions.

In order to accede to this appeal, Sharon set up this ad hoc team and stressed that this would not be a permanent team for contacts with the Palestinians, neither before nor after the elections.

Sharon's headquarters expressed satisfaction over the meeting because it caused the political debate to be diverted from the issue of Lebanon and Lieberman to the current diplomatic issues, "where Sharon is stronger." They also said that the meeting disproved claims by the Left that the Arabs would not want to talk to Sharon and that war could therefore be expected after his election.