Barak hints debts will keep party in government

Sources close to Labor chairman say he still believes there will be a general election in 2008 but later than originally planned.

Labor will have to remain in Prime Minister Ehud Olmert's coalition until the party takes care of its massive financial debts, party chairman Ehud Barak hinted in a speech to the party's executive committee at its Tel Aviv headquarters on Tuesday. Barak promised during his race for the Labor chairmanship that he would remove the party from the coalition and initiate an early election when the final Winograd Report on the Second Lebanon War is released, as early as October. But officials close to Barak said when the promise was made that an excuse would eventually be found to break it. "We cannot win an election as a charity case," Barak told the executive committee. "We will take care of [the financial problems] and after that face the political challenge ahead of us." Sources close to Barak said he did not intend to back down from his commitment to leave the government in the speech. They noted that he said in the speech that he still thought there would be a general election in 2008. But they said it might have to be later in 2008 than he had originally intended. Barak denied reports the party would fire all its employees and sell all its branches and other properties to tackle a debt estimated at NIS 140 million. The reports said the party would leave its headquarters in Tel Aviv's Hatikva Quarter and find a new location outside the city. "We do not intend to sell the party in a going out of business sale," Barak said. "But we cannot spend more than we bring in. We will do everything possible to maintain our employees and branches and to get through this like a family." The executive committee decided to form three panels to examine how to handle the debt. Labor Secretary-General Eitan Cabel blamed the debt on there being too many elections in the party. "From the day I started this job, I haven't been able to sleep at night, because of the state of the party," Cabel said. "But if I quit, the debts won't quit with me." Former Labor treasurer Moshe Cohen blamed the debts on Cabel and former party chairman Amir Peretz. He accused them of spending millions of shekels during last year's general election campaign without seeking authorization. "The party is in the state it is because of the management of Eitan Cabel and Amir Peretz," Cohen said. "I warned them a year ago that their behavior would cause the party to collapse." Other Labor officials blamed Barak, who also fired many workers and moved the party headquarters during his first tenure as Labor chairman. They said he was elected to fix the party's crises, but he had instead exacerbated them.