Many observers of Israel are scratching their heads at the outcome of the Israeli elections. What’s going on? Who won? What do Israelis want? What does it all mean – especially for the prospect of peace?The find the answer – ignore the leaders, examine the Knesset.When Israelis go to the polls they elect parties for the Knesset – the Israeli parliament – and nothing else. Israelis do not elect their prime minister – no matter how many billboard of Livni or Netanyahu litter the public spaces; Israelis do not elect members of Knesset either. They have only one vote and the little square paper note they put in the envelope carries only the name of a political party. Israelis elect parties for the parliament and the parties do the rest. The parties put together the government and the parties send their representatives to the Knesset.The Knesset is the supreme sovereign and only nationally elected body of the state of Israel. The government rules only if the Knesset supports its rule, and as soon as the Knesset withdraws its support the government crumbles. That is why Israel is entering its 62nd year with the 18th Knesset just beginning – a reasonable and sufficiently stable average of more than 3½ years per Knesset term – and a 33rd government about to be cobbled together – an average of nearly two governments per Knesset.Detractors of the system would highlight this governing instability. Supporters of the system – like myself – extol its flexibility. The Israeli Knesset is capable of putting together new governments according to shifting threats and opportunities. If a major threat presents itself, rival parties come together to govern through the threat. If a major opportunity emerges, friendly parties bond together to take advantage of the new reality. Sometimes even parties split apart to allow for shifting conditions. When even that level of flexibility proves insufficient, early elections are called for to change the composition of the Knesset so that new types of coalition governments are made possible.The Israelis have elected neither Livni nor Netanyahu. They have elected a new Knesset where Livni’s party – Kadima – and Netanyahu’s party – Likud – each have about a ¼ of the total seats and the remaining 63 seats are divided between other parties across the entire spectrum of political views and interests of Israel’s citizens. It is now up to the Knesset parties to cobble together a governing coalition. And if the past decades are any guide – the governing coalition would be replaced within two years to fit new challenges.So what do the elections to the Knesset – the only ones that truly matter – tell us?They tell us that a clear majority of Israelis don’t believe in the immediate possibility or even necessity of peace, but that a sizeable minority refuses to give up hope altogether – even if it does not believe peace is likely to materialize anytime soon. The elections also tell us that the relationship between Israel’s Jewish and Arab citizens is coming under strain and that a growing number of Israel’s Jews fear Israel’s Arab citizens as much, or even more, than the Palestinians in the West Bank and Gaza. They tell us that the future of the two-state solution is deeply uncertain, and that it might become increasingly intertwined with the question of the relations between Jews and Arabs within Israel.This is the current mood, but there is nothing to say that it could not change. The world is entering a deep recession and the resulting credit crunch, low oil prices and higher basic food prices might serve to weaken the world’s radical forces – especially Iran and its supporters in Russia and China – more than any planned economic sanctions could have done. The weakening of radical forces served in the past to create opportunities for peace, whether it was the pushing out of the Soviets out of Egypt after the 1973 war that led to peace between Israel and Egypt, or the demise of the Soviet Union and the first Gulf War that led to the Oslo peace process and the peace agreement between Jordan and Israel.Global leaders have better things to do these days than to focus their energies on the Israeli-Palestinian conflict. Preventing global economic and political disintegration is the only thing that matters. However, leaders should keep their eyes and ears open in case the economic downturn creates a new opportunity for peace. Should such an opportunity present itself, the Israeli political system has sufficient flexibility built into it to realign itself with new realities.In politics there are but two forces – hope and fear. When fear outweighs hope – the right grows strong – that is true the world over. When hope outweighs fear – the left returns. In 2006 the majority of Israelis voted – albeit cautiously – for hope. In 2009 – feeling that hope has failed – the majority voted out of fear. But should there be reason to be hopeful again, the Knesset will do its job and politics will surely follow.