The measure of his despair at the prospect of being locked into a right-wing coalition is the far-reaching concessions he offered Livni in their meeting. Her Kadima Party, he said, would have “full partnership” in the government, and their two parties would have the same number of ministers. Kadima would have the choice of two of the top three ministries – defense, foreign and finance. Furthermore, the outline of the new government’s policies would be drawn up by the two of them together.

If Livni was impressed by Netanyahu’s generosity she gave no hint:

“I am taking Kadima into the opposition,” she told reporters after emerging from the meeting.

“As far as I’m concerned, this meeting has changed nothing.”

What she had not heard from Netanyahu, she told party colleagues, was an unequivocal readiness to negotiate with the Palestinian Authority about achieving “two states for two peoples”. Referring to the settler-dominated wing of the coalition she said “In such a government my ability to wield influence would be limited or non-existent.”

Netanyahu, meanwhile, was telling reporters that Israel faced challenges that no government in Israel has faced since the founding of the state when the country was invaded by several Arab armies. Referring to the Iranian nuclear program, Hamas and other items on the national agenda, he said. “A time of emergency demands abandoning (petty) politics.”

Livni’s seeming determination to go into opposition has drawn criticism from some Kadima leaders who prefer continuing as ministers over moving to the opposition benches. Some accuse Livni of trying to establish her credentials as an Iron Lady. Some warn that the party might erode in opposition, with many of its ex-Likud members rejoining that party.

Others, however, credit her with political astuteness. A right-wing government would be forced out of power within a year or so, they argue, and a stint in the opposition would give Kadima the credibility it needed to return to power. Some believe that Livni in fact is not ruling out joining Netanyahu’s government. If he sweats enough, they believe, he may give her what she wants – ensuring a political dialogue with the Palestinians and ridding his coalition of one or two right-wing parties so that the government's survival depends not on them, but on Kadima, which is the only certain way of keeping Netanyahu to his word.

Even the idea of a rotating premiership – two years for him, two for her – might be considered by Netanyahu in extremis, say analysts, despite his declarations to the contrary.

The intermission is over, and Act Two is beginning.

Abraham Rabinovich for RT