J By Laura King

ERUSALEM – Israeli Prime Minister Ariel Sharon, unable to shore up his battered government, on Tuesday called early national elections, even as he acknowledged that a possible U.S. war with Iraq and a deadly stalemate with the Palestinians make this a perilous time for Israel to embark on a turbulent political campaign.

“Elections are the last thing this country needs right now,” a somber-faced Sharon, flanked by blue-and-white Israeli flags, told a news conference at the prime minister’s office after notifying President Moshe Katsav of his intention to dissolve the 120-seat Knesset, or parliament.

The election date, still to be ratified by parliamentary committees, was set for Jan. 28, nearly 10 months ahead of schedule, but it could be later than that.

The calling of early elections was the culmination of a chain of events that began last week when the left-of-center Labor Party broke its alliance with Sharon’s conservative Likud Party, stripping his coalition of its comfortable parliamentary majority. Sharon spent several days trying to patch together a new, narrower coalition – and even has joined forces with a frequent rival, former Prime Minister Benjamin Netanyahu – but would-be parliamentary partners imposed what he described as unacceptable conditions.

The prime minister had courted the far-right Yisrael Beiteinu faction, which has seven Knesset seats, enough to cement a majority for Sharon. But the party publicly made a series of hard-line demands, including the formal rescinding of the 1993 Oslo peace accords and the rejection of a U.S.-authored “road map” for restarting negotiations with the Palestinians.

“I will not change the basic guidelines of this government,” Sharon said, without specifying which of the party’s conditions had made an accord impossible. “I will not undermine our strategic understandings with the United States. I will not endanger the special relationship which my government formed with the White House.”

Some political observers suggested that speedy elections were better than waiting for a vote in the spring, a timetable initially floated after the coalition’s collapse.

“The country will be cast into chaos, but at least it will be shorter-lived chaos,” said Yitzhak Herzog, who served as Cabinet secretary under Labor Prime Minister Ehud Barak.

Even so, a three-month time frame could encompass hostilities in Iraq – a conflict that the Bush administration very much hopes to keep Israel clear of. Sharon himself was tight-lipped about any scenario involving war breaking out while Israel is in the heat of an election campaign.

“I really suggest that we speak very little about this topic,” he told reporters. “I only wish to say one thing: Israel has adopted every single step in order to ensure that its citizens will be safe.”

In the wake of his troubled alliance with Labor, Sharon entered into a partnership even more fraught with conflict and contradiction: with Netanyahu, who over many years in Israel’s rough-and-tumble political scene has been both Sharon’s ally and his nemesis.

Last week, Sharon invited former Prime Minister Netanyahu to join his Cabinet as foreign minister, and Netanyahu – after making early elections a precondition for doing so – accepted the job Tuesday, hours after Sharon’s announcement. He is to be sworn in Wednesday morning.

“We are in a most difficult security situation, and we also know that we are on the eve of a war in Iraq, and since the prime minister has done the right thing by pursuing early elections, I am willing to undertake the national and personal responsibility of serving as foreign minister in his outgoing government,” Netanyahu told reporters.

But even as he agreed to become part of Sharon’s caretaker Cabinet, Netanyahu expressed a trademark cool confidence that he, not Sharon, will be the one to carry the Likud standard into the January elections. He intends to challenge Sharon in primaries later this month.

“I do think – hope, believe – that I will receive the confidence of Likud Party members to lead,” he said.

The Labor Party, now the leader of the opposition, has its own leadership contest in two weeks. Former Defense Minister Binyamin Ben-Eliezer, who led the Labor exodus from the government last week, is facing strong challenges from former Maj. Gen. Amram Mitzna and veteran lawmaker Haim Ramon.

Many in the Labor ranks were angered by Ben-Eliezer’s walkout from Sharon’s government, believing him to have been motivated more by a desire to position himself in the party leadership race than by the stated reason, a dispute over funding for Jewish settlements in the West Bank and Gaza Strip. Labor wanted about $145 million that was earmarked for settlements to be diverted to social spending.

At his news conference Tuesday, Sharon took a slap at Ben-Eliezer, calling the Labor decision to abandon the coalition a “political caprice.” Ben-Eliezer, in turn – alluding to the budget fight – declared that Sharon had “contempt for the poor.”

The Palestinians have said they consider Israeli electoral politics to be an internal Israeli affair but have made no secret of the fact that they consider Sharon’s government a destructive failure.

“In the last two years, we have seen time wasted and a deepening of the conflict,” senior Yasser Arafat aide Saeb Erekat said Tuesday. “We really hope that the Israeli people this time will choose a government capable of delivering peace in the region.”