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Demonstrators drape the national flag of Israel on the walls of Jerusalem's Old City.


What We’re Watching: Bibi’s defiance, US strikes in Syria, Lula’s China visit, Putin’s Hungary refuge, India vs. free speech

Bibi’s not backing down

Israelis waited with bated breath on Thursday evening as news broke that PM Benjamin “Bibi” Netanyahu was preparing to brief the nation after another “day of disruption” saw protesters block roads and strike over the government’s proposed judicial reforms.

The trigger for the impromptu public address was a meeting between Bibi and Defense Minister Yoav Gallant, also from the ruling Likud Party, who has voiced increasing concern that the looming judicial reform would threaten Israel’s national security, particularly as more and more army reservists are refusing to show up for training.

That never happened. While he talked about healing divisions, a defiant Netanyahu came out and said he will proceed to push through the reform, which, among other things, would give the government an automatic majority on appointing Supreme Court judges. This came just a day after the Knesset, Israel’s parliament, passed a bill blocking the attorney general from declaring Netanyahu unfit for office due to a conflict of interest over his ongoing legal woes and his bid to dilute the power of the judiciary. In response, the attorney general released a letter Friday saying Netanyahu's involvement in judicial reform is "illegal," suggesting a much-dreaded constitutional crisis may have begun.

Two things to look out for in the days ahead: First, what does Defense Minister Gallant do next? If he threatens to – or does – resign, it could set off subsequent defections and be a game changer. Second, how do the markets respond? Indeed, markets rallied Thursday before Bibi’s address in hopes that the government was set to backtrack on the reforms that are spooking investors, but the shekel value slumped after the speech.

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