cessor, President Anwar Sadat, was ready to move
further, in order to regain the Sinai, lost in 1967.
During 1977, an election year, Labour’s chances
were harmed by government scandals and by the
damage inflicted on the economy by the high cost
of war and armaments. The oriental Jews in partic-
ular regarded the Labour ministers as too ready to
compromise with Israel’s Arab neighbours. All this
contributed to the sea change in Israeli politics.
The May 1977 elections brought Menachem
Begin and Likud to power at the head of a coali-
tion, breaking three decades of uninterrupted
Labour predominance. Begin, at sixty-four years
of age, was no longer the terrorist he had been
during Israel’s struggle for independence, but he
was convinced that only armed strength, self-
reliance and rock-like firmness of purpose would
secure Israel’s future. On the question of the
West Bank and some possible accommodation
with the PLO, he was unyielding: for him the
right of the Jewish people to ‘Judaea and Samaria’
was not negotiable; for him this was not ‘occu-
pied’ but ‘liberated’ territory, and so was East
Jerusalem, which had been captured from Jordan
in 1967. Nor did Begin in 1977 give any indica-
tion that he contemplated handing back occupied
Sinai in return for peace with Egypt. Yet that was
to become the crowning achievement of his first
administration. Perhaps only an Israeli prime min-
ister with Begin’s uncompromising reputation
could have won virtually wholehearted Israeli
support for relinquishing the Sinai.
At home, free-enterprise policies soon led the
country into economic crisis. Given the realities
of Israeli expenditure and the huge foreign
indebtedness, Likud eventually had to return to
the mixed economic policies of previous govern-
ments. Even so, for his supporters – the poor ori-
ental Jews – Begin provided help in housing, and
assisted the renewal of poor neighbourhoods by
twinning them with Jewish communities abroad;
extending free education was a further important
social reform.
Abroad the Begin government responded to
Sadat’s search for peace, with US mediation play-
ing a crucial role. Sadat wanted to modernise
Egypt, raise the standard of living of its rapidly
expanding population. He turned to Western
investment and away from a state-directed econ-
omy. Success depended above all on securing a
lasting peace with Israel. The crossing by the
Egyptian army of the Suez Canal in the 1973 war
had removed one major obstacle to peace –
Egypt’s self-image, pride and self-confidence had
been restored; Israel had not won all the battles.
The illusion of military prowess in war was enough
to turn Sadat into a hero in Egyptian eyes, as
Nasser had become a hero after Suez. Sadat cut all
links with the Soviet Union and took to relying on
US support and US influence in Israel. In 1975 he
opened the Suez Canal to shipping again, and
allowed cargoes to Israel, though not Israeli ships,
to pass through. In 1977 it was because four men
occupied crucial positions in their countries that a
peace settlement was possible.
In Washington Jimmy Carter entered the White
House, like his predecessors, anxious to facilitate a
settlement in the Middle East. Begin’s priorities
were to secure ‘Judaea and Samaria’, and to defeat
the PLO. Peace with Egypt, even at the price of
returning most of the occupied Sinai, would iso-
late Israel’s enemies and make its position militar-
ily unchallengeable. It was thus a price worth
paying, provided the existing Israeli settlements
and airbases were retained. General Moshe Dayan,
Begin’s new foreign minister, entirely shared this
view. Security for the West Bank was worth the loss
of most of the Sinai. Sadat was also eager for peace:
the cost of continued hostility was simply too high
for the sake of Arab solidarity or the Palestinian
cause. In 1977 he expelled the PLO from Cairo.
Nicolae Ceaus ̧escu, president of Romania, later to
be discredited for his brutal suppressions at home,
was an unlikely mediator, having preserved good
relations with Israel. Another channel of com-
munication between Egypt and Israel was opened
through the good offices of the king of Morocco.
Begin also demonstrated goodwill by warning
Sadat of a Palestinian assassination plot.
That a new era in Israeli–Egyptian relations had
begun became publicly known in a dramatic way.
Sadat liked springing surprises. On 9 November
1977 he announced in Cairo’s parliament that he
was ready in person to go to the Israeli parliament
in Jerusalem, the Knesset, to discuss the issues that
divided Israel from its Arab neighbours. Begin was906 GLOBAL CHANGE: FROM THE 20th TO THE 21st CENTURY