JERUSALEM, May 23 (JTA) — The Mitchell Commission report on ongoing Israeli-Palestinian violence appears to be widening cracks in Israel’s unity government, as well as in what has been the Israeli public’s solid support for government policy.

Among its recommendations, which drew the support of the Bush administration Monday, the report calls for an immediate cease-fire followed by a cooling-off period and a series of confidence-building steps.

Among those steps is a call to halt all Israeli settlement activity in the West Bank and Gaza Strip, including the “natural growth” of existing settlements.

Analysts parsed the words of Prime Minister Ariel Sharon, the leader of the Likud Party, and Foreign Minister Shimon Peres — leader of the Labor Party, which joined the unity government that Sharon formed following his election in February — for signs of dissension.

The differences between the government’s two principals are subtle, and could either be a question of nuance — or could represent more fundamental gaps.

Peres has said Israel will agree to a geographic settlement freeze — that is, it will not expand settlements’ boundaries — but cannot freeze demographic growth within existing settlements.

Sharon, too, has insisted on the settlements’ right to “natural growth,” and pledged in comments on the Mitchell report Tuesday that Israel would not expropriate any more Palestinian land for the settlements. Some analysts, however, wondered if that meant Israel might take land to blaze roads in the West Bank.

Opinion polls continue to reflect a high level of respect for Sharon. But at the same time, the polls indicate that most Israelis favor a halt to settlement construction — and indeed a withdrawal from some settlements — in exchange for a truce.

On Tuesday, Sharon called for a truce and a cooling-off period, after which the two sides could begin implementing the Mitchell Commission report.

“I propose to our neighbors to work together for an immediate cease- fire and hope the Palestinians will answer the call positively,” Sharon told a news conference Tuesday.

Shortly after Sharon spoke, Defense Minister Benjamin Ben-Eliezer issued a directive to cease firing on Palestinians, adding that Israeli troops should only open fire “when lives are endangered.”

On Wednesday, President Bush telephoned the leaders of Israel and the Palestinian Authority and urged them to reach a cease-fire and resume negotiations.

Sharon and Palestinian Authority President Yasser Arafat agreed to try to find a framework to resume peace talks, according to a U.S. official.

During his call to Sharon, Bush reportedly complimented him on his announcement of a unilateral Israeli cease-fire. Palestinian officials derided Sharon’s announcement as a public-relations ploy.

Despite the diplomatic moves, violence continued Wednesday, when one Israeli was killed and another wounded by Palestinian gunfire near the West Bank settlement of Ariel, Israel Radio reported. The two were highway construction workers, according to the report.

Also on Wednesday, Israel’s Shin Bet domestic security service said it uncovered a Gaza network that was manufacturing weapons and was directed and funded by the head of Palestinian police in the Gaza Strip.

In a related development, Israel Radio reported Wednesday that Israeli security officials this week detained an owner of a Palestinian iron factory who admitted to manufacturing dozens of mortar bombs and hand grenades for officials in the Palestinian Authority. The factory owner also provided a list of other people involved in the effort.

Peres predicted Tuesday that Israel and the Palestinians would accept the Mitchell report and resume “within a few days” their negotiations on the basis of the report.

Israel and the Palestinian Authority got copies of the report in early May, when the report’s findings were leaked to the press. Former Sen. George Mitchell officially released the report Monday in New York.

Mitchell’s blue-ribbon commission was conceived as part of a peace package at a summit in Sharm el-Sheik, Egypt, last October. Central to the package was an immediate cease-fire, so that the commission would be examining the roots of a violent Palestinian uprising that presumably would long have ended by the time the commission began its work.

In the end, the report was the only element of the package that was implemented, infuriating Israeli officials.

Panel members include Mitchell, the group’s chairman; Turkish President Suleyman Demirel; Thorbjoern Jagland, Norway’s minister of foreign affairs; and Javier Solana, the European Union’s top diplomat.

Among the report’s other recommendations:

• The Palestinian Authority should crack down on terrorism;

• The Palestinian Authority should prevent Palestinian gunmen from firing on or from populated areas, and establish a clear chain of command for all armed personnel operating in areas under its control;

• Israel should lift closures on Palestinian areas, permit Palestinian workers to return to their jobs in Israel and transfer to the Palestinian Authority all tax revenues owed; and

• Israel should ensure that its security forces avoid destroying homes, roads and trees in Palestinian areas.

By spotlighting the settlement issue, the report had the effect — likely unintended — of exacerbating existing tensions within the Israeli government between moderates and hardliners.

These tensions already were running high after Sharon responded to a terror bombing last Friday that killed five Israelis by launching Israel’s first jet strikes on the West Bank and Gaza Strip since the 1967 Six-Day War.

The strikes by the F-16 warplanes — which killed 12 Palestinians and wounded dozens of others — were widely condemned around the world.

While Sharon and Peres are trying to keep the differences between them as muted as possible — in the interests of government stability — other Cabinet members have been outspoken in their reaction to the settlement construction issue.

This has sparked speculation that the unity government may be seriously threatened by the Mitchell report, especially if the United States energetically pushes to have it implemented.

Infrastructure Minister Avigdor Lieberman, a member of the hawkish National Union Party, warned this week that Israel’s acceptance of the Mitchell panel’s recommendations would spell the beginning of the end of the unity government.

Legislator Reuven Rivlin, a member of Sharon’s Likud Party, termed the Mitchell recommendations “a prize to terrorism.”

Meanwhile, Ben-Eliezer, a member of Labor, told the Israeli daily Ha’aretz he would be prepared to accept a full settlement freeze if it were limited to a period of months.

Significantly, Ben-Eliezer hinted broadly to the newspaper that he also would consider evacuating certain settlements — an option Sharon has categorically ruled out.

On Monday, U.S. Secretary of State Colin Powell said the United States would use the Mitchell report as a basis to try to end Israeli-Palestinian violence.

But in an effort to take account of Israeli sensitivities, Powell noted pointedly that the call for a complete cessation of violence was “unconditional” — in other words, not dependent on a settlement freeze.

Sources close to Sharon welcomed Powell’s careful language.

The Palestinians have announced that they accept the Mitchell recommendations as one integral whole — and will make any cessation of violence contingent on a settlement freeze.

However, in numerous previous agreements with Israel and international summit meetings, the Palestinians already has agreed to many of the anti-violence steps the Mitchell report demands of them — and have promptly ignored them.

The growing controversy about the recommended settlement freeze came as Sharon was under attack for the F-16 strikes.

“What do we use next time,” legislator Dan Meridor, a Center Party member who is chairman of the Knesset Foreign Affairs and Defense Committee, asked this week, “if we use F-16s this time?”

Meridor and others noted that any tactical advantage obtained by the warplanes was outweighed by the setback Israel suffered in the battle for world sympathy.

All the major Israeli newspapers condemned the F-16 bombardments as hasty and ill-conceived — the first time since Sharon took office that his tactics in fighting Palestinian violence have been widely challenged.

The criticism surged anew Sunday night, when an Israeli tank fired two shells at the Ramallah home of Jibril Rajoub, the head of Palestinian security forces in the West Bank and one of the few senior Palestinian figures still in constant contact with the Israeli side.

Only hours earlier, Rajoub, who was not hurt in the shelling, had hosted Israeli reporters for a briefing in his office.

The imbroglio was compounded Monday, when the major commanding the tank unit told a radio interviewer that he and his men had known they were firing on Rajoub’s home — but were returning repeated fire from a Palestinian forces positioned beneath Rajoub’s house.

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