On January 22, Israel will elect the members of the 19th Knesset, its main legislative body, in nationwide elections. The Knesset works in a multi-party parliamentary system, where the party, or a coalition of parties, with a majority of seats selects the prime minister. Currently, Benjamin Netanyahu of the right-wing Likud party holds that position, and he looks poised to maintain his position of power.
Netanyahu leads a coalition of right-wing parties, recently dubbed Beit Likud, including Likud, the far-right Yisrael Beitenu, formerly headed by former Foreign Minister Avigdor Lieberman (until he stepped down due to fraud charges), and a number of other conservative and religious parties. The most prominent religious party in the ruling coalition is Shas, which represents the ultra-orthodox Jewish population of Israel. They are generally the strongest in favor of annexing the West Bank, and are exempt from the national draft due to religious reasons. The opposition is represented by the center-left Kadima, headed by Shaul Mofaz, and the social-democratic Labor Party, headed by Shelly Yachimovich.
Politically, Israel has been drifting farther to the right over recent years, becoming jaded with the "peace process," and right-wing politicians have shown less willingness to make concessions to the Palestinians. Netanyahu's coalition has no stated policy of intending to withdraw from the West Bank, making the possibility of a viable Palestinian state dubious. Kadima, which currently holds a plurality of seats but is polling exceptionally poorly leading up to Tuesday's election, is one of the only significant parties that recognizes a necessity to mostly withdraw from the West Bank. And Labor has almost no focus on international policy, instead campaigning on food prices, wages, and other domestic issues.
However, the biggest story in the upcoming elections is Naftali Bennett, a right-wing settler who leads the Jewish Home party. He and his party are adamantly opposed to any withdrawal from the West Bank or Gaza, and in fact advocate a total annexation of the former. He suggests when this happens, the Palestinians will simply leave and head for Jordan or other neighboring majority Arab countries. His party is polling in third, behind Beit Likud and Labor, but will likely have much influence in the coming Knesset. He is a manifestation of the modern brand of Zionism, which has become conflated with Orthodox Judaism, in contrast with the founders of Zionism, who were mostly secular and resembled the current Labor Party.
The drastic right-wing shift of Israeli politics has many consequences for relations with Palestinians, both within and without Israel proper. Israeli Arabs, who currently are granted full citizenship, but face much infrastructural and social discrimination, are increasingly seen as a threat by Jewish Israelis, and right-wing political positions reflect this. Additionally, if the West Bank is annexed (a policy strongly advocated by Jewish Home and other like-minded parties, but still avoided by Beit Likud), a majority of Israeli Jews do not think the 2.5 million Palestinians should be given the right to vote. This would obviously threaten the democratic credentials of Israel, if around 30% of its population were legally disenfranchised.
Considering Bennett's booming popularity, it is not inconceivable to predict he will become prime minister in the not too distant future. If that happens, Israel will likely annex the West Bank, hammering in the last nail into the coffin of the two-state solution. Following this, it will only be a matter of time before Israel is forced to recognize the equal rights of Palestinians and Jews within its borders, as anything else would effectively be Apartheid, and considering Palestinians from the Jordan River to the Mediterranean Sea currently outnumber Jews, Israel will cease to be a Jewish majority state. It is ironic, then, that those who are the most fervent in their support for Zionism, and a Jewish democracy, will be complicit in its demise.
The Knesset consists of 120 seats, and current polls predict the following results: Beit Likud [34-37 seats], Labor [15-17], Jewish Home [14-15], Shas [10-12], and Yesh Atid [8-12]. There are several other parties who will get a few seats each, including Kadima, which will likely only get two or three seats, down from its current 28.