Rabin to Head Israel's Labor Opposition

YITZHAK RABIN seized the leadership of Israel's opposition Labor Party from Shimon Peres yesterday, increasing its chances of defeating Prime Minister Yitzhak Shamir's ruling Likud Party in a June election.

Labor officials say unofficial returns showed Mr. Rabin winning 40.59 percent in the party election - just over the 40 percent needed to avert a runoff next week against Mr. Peres, his longtime arch-rival, who received 34.48 percent.

Labor believes victory in the June 23 general election will speed up United States-brokered Middle East peace talks. Labor favors trading at least some occupied Arab land for peace, a move opposed by the rightist Likud.

But pollsters say some of Rabin's more hard-line views make him a formidable challenger to Mr. Shamir in a country that has swung to the right.

Under Peres, Labor has failed since 1977 to form a government in its own right.

Speaking at Labor Party headquarters before dawn yesterday after a tense night watching his support hover around 40 percent, Rabin appealed to Peres to join him in fighting Likud.

"I am sure the two of us want first and foremost to ensure the Labor Party's victory in the Knesset elections over Likud," Rabin said.

"Certainly," Peres replied.

Rabin suggested personalities rather than issues had decided the election.

Shamir was expected to defeat Foreign Minister David Levy and Housing Minister Ariel Sharon easily in a fight for the Likud leadership yesterday.

A former Army chief, Rabin has a tough image widely admired by right-of-center voters who welcomed his iron-fist policy against a Palestinian revolt in the occupied territories as defense minister from 1984 to 1990.

His stint as prime minister from 1974 to 1977 ended in a scandal over an alleged illegal foreign-currency account held by his wife which forced his resignation.