UPHEAVAL IN ISRAEL – AT 9:34 A.M. ET:  A major change with possible international repercussions is taking place today in Israel.  This came out of the blue.

(Reuters) - Israeli Prime Minister Benjamin Netanyahu formed a unity government on Tuesday in a surprise move that could give him a freer hand to attack Iran's nuclear facilities and seek peace with the Palestinians.

The coalition deal, negotiated secretly over the past days and sealed at a private meeting overnight, means the centrist Kadima party will hook up with Netanyahu's rightist coalition, creating a wide majority of 94 of parliament's 120 legislators.

The coalition, which replaces plans announced just two days earlier for a snap election in September, will be one of the biggest in Israeli history.

"This government is good for security, good for the economy and good for the people of Israel," Netanyahu told a joint news conference with Kadima's leader, Shaul Mofaz.

COMMENT:  Mofaz, who is Iranian-born, was Israel's chief of staff and later defense minister. He will now be vice prime minister, something that will not be lost on the mullahs of Iran.  The broad coalition, politically stable, gives Netanyahu's government enormous flexibility.  Iran will now feel more heat, which is good.  Let's see if Obama understands how that heat can be used.  Don't hold your breath.

At the same time, the new coalition frees Netanyahu to engage the Palestinians in ways that puts the ball back in the Palestinian court.  Will the Pals use this chance to return to the peace table and maybe come out with a state?   Again, keep breathing.  As one statesman used to put it, the Palestinians never miss an opportunity to miss an opportunity. 

The change in Israel is a major development in Mideast politics, and will start to be felt as new negotiations with Iran over its nuclear program commence in a few weeks.

May 8, 2012