Israel seeks peace with the entire Arab and Muslim world but continues to be threatened by the forces of Islamic extremists, Prime Minister Binyamin Netanyahu said several hours before he was sworn in Tuesday evening. He took the oath of office just before midnight, after the Knesset voted 69-45 to approve the new government. "These are irregular times," Netanyahu told the Knesset plenum. "Today Israel is faced with two tests - an economic crisis and a security crisis. The source of these crises are neither our past actions nor past mistakes.... Our [current] actions, however, will determine the results of these crises." Netanyahu was interrupted numerous times by critics of his extra-large government as he presented it and its guidelines to the Knesset. In the past, Netanyahu himself expressed opposition to large governments due to the expense involved. "It is not with a victor's joy that I stand here today in front of you, but with a great sense of responsibility," Netanyahu began. "I ask for your trust at this time of worldwide crisis of a kind we haven't known before, and it is with a sense of worry, but also with hope and faith, that the State of Israel confronts two major challenges: the economic challenge and the security challenge. I am certain that the people of Israel will cope successfully with the challenges that lie ahead of it." Regarding Iranian threats to "erase Israel from the map," Netanyahu criticized the international community for its lack of response. "The Jewish people has experience with dictators and it cannot overestimate megalomaniac dictators who threaten to destroy it," he said. The new prime minister added that the worst thing for the State of Israel and the world would be "that a radical regime obtains nuclear weapons." The threat to Israel came from the spread of extremist Islam in the region and in the world, Netanyahu said. "I separate extremist Islam from the general Muslim world, which is also threatened by extremist Islam," he told the plenum. "The Muslim culture is a rich culture that knew times of prosperity, of Arabs and Jews who lived together and created things together." Six prime ministers had strived for peace with the Palestinians but failed, he said, adding that "the failure was not their fault. If the heads of the Palestinian Authority want peace, I tell them now - we can achieve it." Netanyahu said his government would work for peace with all of Israel's neighbors on three levels: economic, political and security. "We will carry out ongoing negotiations for peace with the Palestinians in an attempt to reach a permanent agreement," he said. "We don't want to rule another people, and the agreement will give the Palestinians all the rights to rule themselves, except for those that endanger Israel." Netanyahu also explained how his government would handle the "truly unprecedented" economic crisis, saying it threatened the livelihood of tens of thousands of Israelis and that no one could tell when and how it would end. "But I know that the Israeli market has clear advantages that enable it to cope with many challenges," he said. "The fact that we are a small country provides leverage in getting out of this crisis. The Israeli market is like a small and light speedboat whose direction can be changed more easily. I myself will lead this change of direction and the government I head will operate to protect work places, to resolve the shortage of credit in the market, and to maintain macroeconomic policies." Netanyahu also promised a revolution in the education system and set a goal to place Israel among the top 10 countries in the world within 10 years. "From my experience, when you set a goal, a process to achieve the goal starts right away," he said. Netanyahu also discussed his plans to address the increase in crime, promising to strengthen the police, implement more severe punishments and advance reforms. "It is unacceptable that the Jewish people, who were dispersed in more than a hundred countries in the Diaspora where they maintained high standards of morality, came back to their country where crime organizations that deal in murder, women and drug trafficking are emerging," he said. Netanyahu also said he was committed to the Declaration of Independence from 61 years ago, "including the obligation for full equality for all people regardless of their religion, gender and race." He praised departing prime minister Olmert and thanked him for the work he had done for the state, its security and its citizens. Finally, Netanyahu read out the long list of ministers and deputy ministers that he asked the Knesset to approve - to loud catcalls from the opposition. He explained that the coalition agreements had been checked with the relevant legal bodies, adding that when he was in the opposition, he had never shown disrespect for the Knesset. He paused and look out to the spectators gallery where Aviva Schalit sat along with Karnit Goldwasser and Esther Wachsman. Aviva's son Gilad was kidnapped by Hamas in June 2006. Until two weeks ago, hopes had remained high that Olmert would find a way to conclude a prisoner swap with Hamas for Gilad's return. Now, it was Netanyahu's turn to speak of prioritizing Gilad's release. It is right before Pessah, he said. "At our national table, there is an empty chair. It is Gilad Schalit's chair. I will do everything in my power to ensure his speedy return, healthy and whole, to his family's bosom," Netanyahu said. Then he moved from a personal address to the Schalit and said that as an expression of his feelings as Pessah approaches, he had chosen to read to the plenum a portion of one of the last letters that his brother Yonatan had written before he was killed in July 1976 leading a raid in Entebbe, Uganda, to rescue hostages. His brother, Netanyahu said, had written that Pessah was the best holiday, because it focused on the liberty of the Jews. The Jews had gone through many long years of suffering, oppression, vagrancy and degradation, Yonatan wrote. For many years, there appeared to be no ray of light, but that is no longer true, he wrote. This holiday is a testament to the eternal goal of freedom. "Pessah awakens an emotional bond, because of the Seder, and like all of us, I recall old memories from my personal past," Yonatan wrote. But even, he said, as he reflected on his past, "I also see myself as an inseparable link in the chain of the existence and independence of Israel." Then Netanyahu continued where his brother had left off. "Israeli citizens, in this fateful hour, we are all an integral link" in that chain. "From this podium in Jerusalem, which is our eternal capital, I am uttering a prayer to God, to bless that the work of our hands will be blessed, and that the unity with which we started on our way will be a good sign... that will ensure our future." Kadima leader and outgoing foreign minister Tzipi Livni followed Netanyahu with a fiery speech that gave an indication of how her tenure as head of the opposition would be. She criticized Netanyahu for the large government he had presented and warned that the public would soon tire of paying the heavy cost of the coalition's stability. "You imposed this pompous government on the 'thin' public, a government of ministers of nothing and deputy ministers for anything," she said. Livni attacked Israel Beiteinu chairman Avigdor Lieberman, as well as Netanyahu for giving Lieberman's party ministries responsible for enforcing the law while its leader was facing criminal investigations. She also accused the Labor party and its chairman, Defense Minister Ehud Barak, for joining the new government, accusing them of being stuck to their seats at the cabinet table. In a speech that was a farewell to political life, Olmert said earlier that there had been an "unbearable gap between the criticism this [outgoing] government absorbed and its achievements," although he added that he was leaving with no complaints or bitterness. He talked about the main event of his tenure, the Second Lebanon War, and said that time was changing perspectives on the war, which eventually brought quiet to a border that had suffered rockets attacks between 2000 and 2006. Olmert spoke of his partners in waging that war, thanking Labor MK Amir Peretz, at the time defense minister, whom he described as a "decent man," and retired chief of General Staff Dan Halutz, "a noble man and a hero."