Apparently Tip O'Neill's dictum that "all politics is local" is a global phenomenon. This week's election in Israel, for instance, was seemingly more determined by domestic concerns than by the international issues most associate with the country.

The inward focus on economics and social justice, often falling on ethnic and class lines, is largely credited with the surprise showing of the Yesh Atid (There is a Future) party. Led by Yair Lapid, a charismatic journalist-turned-politician, Yesh Atid won 19 seats in the 120-seat Knesset. That's second only to the 31 won by the combined Likud-Beiteinu parties, which previously held 42 seats.

Israeli Prime Minister Benjamin Netanyahu leads Likud-Beiteinu, and he's expected to lead the next government. But his center-right coalition has been reduced to a razor-thin 61-vote majority. So it's expected that Netanyahu will try to bring Yesh Atid into a broader, more stable coalition.

That will make Lapid a power broker. As he uses his leverage to address domestic concerns, Lapid should be mindful that those goals are also advanced by convincing Netanyahu to moderate his position on the Palestinian peace process. Talks are stalled, and new West Bank settlements continue to unsettle supporters in the West while also enraging many Palestinians. Lapid said little during the campaign about the peace process, but he does favor a two-state solution, reflecting official U.S. policy. Still, he's no dove, saying he seeks a "divorce agreement we can live with" in lieu of a "happy marriage" with Palestinians.

Clearly, expectations should be kept in check. Lapid's lack of emphasis on the peace process, and a center-right coalition that ended up more right than before (Likud's losses were disproportionately in seats held by more moderate politicians), make a major shift unlikely. And Israel needs a willing peace partner; Hamas, which rules Gaza, is rightly considered a terrorist organization by Israel, the United States and European Union. And even the West Bank faction, Fatah, led by Palestinian President Mahmoud Abbas, needs a more moderate approach in dealing with Israel.

Regarding Iran, whose potential nuclear weapons program Israel justifiably considers an existential threat, Lapid reportedly is wary of a unilateral military strike, an option Netanyahu seems more willing to accept.

Once a new government is formed, Israel has a unique opportunity to reset its relationship with the United States as well. No doubt Netanyahu alienated many in the Obama administration with his near-open declaration of support for Mitt Romney and his courting of conservatives in Congress.

"If the message to Netanyahu from the voters is 'come on, get real, get practical, solve our real problems,' then I think that's the same message Obama tried to send Netanyahu," said Michele Dunne, director of the Atlantic Council's Rafik Hariri Center for the Middle East.

For his part, Obama needs to reach out to Netanyahu as well as to everyday Israelis. It's well past time for the president to visit Israel in an effort to get Israeli and Palestinian leaders back to the bargaining table. Newly re-elected, Obama and Netanyahu need to seize the initiative.


An editorial of the Star Tribune, Minneapolis.