Investigations into Israeli PM Ehud Olmert's predilection for cash-filled envelopes reached a new milestone today with the testimony of Morris Talansky. New York-based Talansky confirmed that he had "transferred Olmert some $150,000 over 15 years, and that Olmert had tried to aid a Talansky business venture", but that "he [Talansky] never had any personal benefits from this relationship whatsoever." As more information is made public in this case the pundit-class is increasingly adamant that Olmert will not be able to politically survive this storm.

Fairly or not, Ehud Olmert is likely to be tagged as Israel's most dishonest Prime Minister--yet in many ways he has been more honest to his public about Israel's regional predicament and the steps it needs to take than almost any of his predecessors. In his latest outpouring of home truths, Olmert yesterday told one of his detractors that anyone who believes that it's possible to hold onto the greater land of Israel, the territories captured in '67, is "delusional". With the resumption of talks with Syria last week, despite a distinct lack of enthusiasm from the Bush administration, it seems that Olmert maybe going out on a high and is leaving an interesting diplomatic legacy.

First a note of caution--it is not over yet for Olmert. Talansky will be cross-examined by Olmert's lawyers in July and the Prime Minister will try to struggle on and may even succeed. But that is increasingly unlikely. My friends high up in Kadima are telling me that this is over, Olmert's possible successors are revving up for a leadership campaign. The ultra-religious Shas party, sensing early elections, is threatening to quit the coalition, and the Labor party is as usual in disarray.

Ehud Olmert is obviously far from being a model Prime Minister. His mistakes are numerous and his arrogance legendary. The 33-day Lebanon II war in the summer of '06 tops the list of bad judgment calls. The imposition of a siege and collective punishment on the 1.4 million inhabitants of Gaza is unforgivable. The man Olmert personally appointed to be Justice Minister, Daniel Friedmann, is waging a dangerous and disturbing campaign against the Supreme Court, and there has been precious little positive on the socio-economic front.

In many ways, the alleged Olmert misdemeanors are a less damning chapter of his premiership--at least from a comparative perspective. In terms of what Olmert is being accused of, the material is similar to the investigations conducted against his predecessors Benjamin Netanyahu, Ehud Barak, and Ariel Sharon. Netanyahu's successful campaign in 1996 was helped over the line by a sudden, huge in-flux of funding for a "Bibi's good for the Jews" campaign that clearly contravened campaign finance regulations. Bibi was also investigated for receiving various gifts and favors, most recently for a lavish trip to London during that same Lebanon conflagration in '06 (see my piece about that here). Barak and his associates were also investigated for the use of NPOs and tax-deductible donations to those NPOs for direct campaign expenses. Insufficient evidence was found--Barak got away with it. A series of investigatory clouds hovered over the Sharon premiership. Most notably the setting up of fictitious straw companies through which monies were funneled to finance election campaigns. Ariel Sharon denied knowledge and his son Omri Sharon was the fall guy, and Omri is now serving a 7-month prison sentence for fraud.

The difference with the Olmert investigation, it seems, is that one or more of Olmert's confidantes are singing--and that is a huge difference. By the way, Talansky is literally singing--in his police-questioning he started humming the tune of the old Likud revisionist song "The Two Banks of the Jordan", which aspires to a state of Israel in all of what is today Israel, the West Bank, Jordan and beyond. There are in fact suspicions that Talanksy's right-wing political affiliation is what has motivated him to bring down Olmert, although his actions more resemble those of a spurned suitor, complaining in one interview that his great beneficiary Mr. Olmert had only deigned to meet him twice since becoming Prime Minister two years ago.

Look--with all these bruises, Ehud Olmert is hardly the guy you want out there selling a peace deal to the Israeli public. For many commentators his continued pursuit of peace negotiations is no more than an attempt to distract attention away from the investigations. His credibility is shot and he looks jealously at Bush's approval ratings--so to be clear, Olmert cannot deliver on peace, not with Assad and not with Abbas.

Yet Olmert has done something unusual for which he deserves credit: he has occasionally, and unusually for an Israeli leader, shared some hard truths and realities with a public that has grown used to being told that they can have their cake and eat it too. Israelis may have known better and their previous leaders almost certainly knew better, but maintaining the illusion that Israel could continue confidently into the future while retaining the occupation seemed convenient for all concerned.

Olmert's push back yesterday was only the latest in a number of frank, myth-shattering pronouncements that he has made. Yesterday's contribution included the following: "Today we are faced with a cruel choice between the undivided Land of Israel and a Jewish state. These two cannot coexist, except in the delusions of the hallucinatory."

Responding on behalf of the hallucinatory, National Union-NRP MK Aryeh Eldad called for Prime Minister Olmert to be sentenced to death for committing the act of treason of ceding sovereign state territory. One can look forward to Mr. Eldad perhaps being part of a future Netanyahu government.

Olmert has reminded Israelis that it is ok and even necessary to talk to one's enemies with his re-launching of negotiations with Syria. Israeli and Syrian officials have conducted proximity talks, mediated by representatives of the Turkish Prime Minister last week in Istanbul. Of course in Bush-McCain land, that would make Israel's Prime Minister a Chamberlain-esque appeaser who had forgotten the lessons of the holocaust. Indeed, the Bush administration is displaying a distinct lack of enthusiasm for the Israeli-Syrian talks, and shows no sign of encouraging or facilitating their success. So it took a degree of courage for an Israeli Prime Minister to pursue the negotiations regardless, and he has also reminded the public that the price for a deal is known--namely withdrawal from the Golan (to read why Netanyahu's criticism of the Syrian negotiations and of any withdrawal from the Golan is so lacking in credibility, read this post and this text of a draft agreement between Netanyahu's envoy and President Assad from1998).

Olmert resumed final-status negotiations with the PLO after an almost 7 year hiatus and his opening negotiating positions have certainly been more reasonable than his Labor party processor Ehud Barak. Olmert has even been blunt about the necessity of a two-state solution, telling reporters after the Annapolis-November '07 conference that "if the day comes when the two-state solution collapses, and we face a South African-style struggle for equal voting rights, then, as soon as that happens, the State of Israel is finished."

While Olmert's handling of Gaza and the siege he has imposed is hardly praiseworthy, he has at least avoided the urgings of some of his more hawkish ministers and the Shin Bet heads to launch a re-occupation of Gaza, and he has authorized Egyptian-mediated efforts at a cease-fire with Hamas (again, rating high on the appeasement-ometer).

It is unlikely that anyone would want to claim the mantle of this Olmert legacy--that is a shame. It is even more unlikely that Olmert will speak these home truths when he addresses the AIPAC annual conference (if he still comes) next week in Washington, D.C. That is an even greater shame. Expect that speech to be a pander-fest and to forgo the opportunity of speaking truth to power, and expect this writer to feel rather embarrassed the following morning for having written these complimentary words.