03/13/2013 05:03 pm ET Updated May 13, 2013

White Smoke Also in Jerusalem

Four days before his mandate to establish a new government expires, and a week before President's Obama visit to Jerusalem, Benjamin Netanyahu is putting the finishing touches on his new cabinet. Not as big a drama as unfolded in another city of eternity, but still an important milestone in the political history of Israel.

So, in the tradition of the upcoming festival of Passover, the question is what is the difference between this government and all the 32 previous ones?

The answer may not please Netanyahu's fans in Israel and abroad, but something is happening which signals major changes in Israel's politics. For the first time in the history of the state, the PM, while formally still the big boss, in reality is not. In this third term of Netanyahu, the Likud leader is going to be a PM, but more in title than in reality. Netanyahu will in most likelihood be a nominal PM, in a term which will be much shorter than the four years allotted to the new government. It will be a term of transition, a transition from one generation of politicians to another, much younger one; a transition from the domination of the Likud-religious electoral coalition to a more flexible, fluid, less rigid political landscape.

It all started with the election results, which put Netanyahu and Likud on top, but just barely. As was predicted in this blog, the results made it impossible for Netanyahu to reestablish his old and most preferred coalition with the religious parties. This coalition cemented so diligently by the great Likud leader, Menachem Begin back in the 1970s, is no more. The two ultra-Orthodox parties, Shas and Torah Judaism, are out. They will wait for their moment, and when and if Netanyahu will need them again, the price will be high, VERY high -- intolerably so. Netanyahu could theoretically establish a government with the religious parties, but he understood that the political toll will be too high for him. In the future it is just going to be much higher.

Another new development is the rise of Naftali Bennett and the Jewish Home party, a natural partner for Likud on issues concerning the peace process, being the party of the settlers, and yet, Bennett turned his back to Netanyahu and forced him into this new coalition with Yair Lapid and the Yesh Atid party. Bennett took most of his new seats from Likud, and he is ambitious, talented and young. Yes, he wants to be a PM, something which religious politicians in Israel could only dream about.

He is a doctrinaire politician when dealing with settlements, but he also has an economic concept, a wish to bridge the gap between religious and secular in Israel; in short, he wants to be a national leader, to move out of the religious box. He is competing with Netanyahu over the leadership of the Israeli right wing, and he is a generation younger, claiming to be a representative of "new politics." Here is a challenge to Netanyahu, and the PM will have to deal with a new situation from now on which he has never had before.

Bennett has created the most surprising political alliance in Israel's recent history, as he and Lapid are formal allies, pledging to join the government only together, thus forming a bloc of 31 MKs, while Netanyahu commands support of also 31 MKs.

The new government will be a double-header, and Lapid and Bennett, two aspirants to national leadership, are not going to allow Netanyahu to function as the undisputed leader, as was the case in his previous government. Formally, there is an inner cabinet of nine ministers, which will be the deciding body; in actual terms, there will be a triumvirate of Netanyahu, Lapid and Bennett. Avigdor Lieberman and Tzipi Livni will be around, but Lapid and Bennett will be the power brokers.

This opens the gate to new politics in Israel. Two young, inexperienced politicians in a position of centrality in a country which has always admired the charisma of former generals and other heroic figures. Lapid and Bennett are too young to show too much for themselves, but rather than that being a deficiency in the minds of Israelis, it seems to be an advantage. A lot depends on the ability of these two politicians to continue their cooperation in the future. The point is that both of them are interested in a short period of cooperation, in which they will advance causes dear to their electorate, and then push for new elections, hoping to reap the political dividends. Then the two will be on opposite sides, but that is another story. Lapid will position himself as the leader of the center-left, Bennett of the center-right. And Netanyahu? Likud? There will be changes there.

The loss of seats in the elections was painful, the estrangement from the religious right unacceptable to many. The winds of rebellion are already blowing. With all that happening, the question of the peace process is pushed to the back burner, at least so far as Israeli politics are concerned. Unfortunately for Israeli politicians, their plans for the future may prove somewhat unrealistic. The Palestinians are here, the "Arab Winter" is with us, Egypt is unstable and Syria is burning. Foreign and security issues are not the basis of the Lapid-Bennett alliance. When these issues will dominate the scene, the alliance will be strained, and Netanyahu could play again the role of the experienced, mature, national leader. Iran and its nuclear program could also provide him with the opportunity to reclaim his role as a full-fledged PM, but as of next week, and short of any dramatic crisis, the veteran politician will be a PM whose wings are greatly clipped.