In stepping down, Halutz has become the most senior Israeli figure to pay the price for the botched war, which sparked harsh criticism in Israel for failing to achieve its goals of freeing two seized Israeli soldiers and destroying the Shi'ite militia.
Instead, Hizballah emerged with its political profile enhanced in Lebanon after standing up to Israel and inflicting damage on the Jewish state with a barrage of rocket fire.Symbol Of Failure
"The chief of staff obviously took responsibility, and as chief of staff he did what he had to do," Israeli Knesset member Reuven Rivlin of the right-wing Likud party said today, summing up the sentiments of many Israelis.
An internal military investigation into the war had criticized Israel's top brass for poor organization, but stopped short of recommending that Halutz quit.
"Whether it's right or wrong, it's one thing, [but] this is the
perception and the image of Israel as a weakening state as a result of
But in his resignation letter, the former fighter pilot said it was time for him to "act responsibly" and go. A government official said Prime Minister Ehud Olmert "reluctantly accepted" Halutz's decision.
The question now is whether it might deepen the crisis facing the scandal-tainted Olmert, and thus further the regional perception of a weakening Israel at a time when tensions are rising with Iran.
"It's big, politically, because the place in Israeli society of the commander of the army is very central," Yossi Mekelberg, an Israeli political analyst based in London, told RFE/RL. "Halutz is paying the price for the failure of the weakness, for the failure of Israel militarily and politically. Whether it's right or wrong, it's one thing, [but] this is the perception and the image of Israel as a weakening state as a result of this."
Government Weakened By Scandals
Halutz's resignation was announced just hours after Israel's state prosecutor ordered a criminal probe into Olmert's role in the privatization of Israel's second-biggest bank in 2005, when he was finance minister.
Ehud Olmert's government has seen its popularity plunge (epa file photo)
Olmert has denied any wrongdoing in the sale of Bank Leumi or in another case, now being considered by Israel's attorney general, into the alleged appointment of cronies to a government-funded business authority.
For now, Israel's foes are gloating over both Halutz's resignation and Olmert's troubles.
"The probe against Olmert is a financial scandal and the resignation of Halutz is a military downfall," Palestinian lawmaker and Hamas spokesman Mushir al-Masri told reporters today in Gaza City.
"So it is a moral and military downfall of the Israeli government. It proves that the Zionist government is weak," he added. "Our people must unite and be more determined to continue resistance and jihad because that choice brings achievements and causes disruption amongst the enemy."
An Israeli poll published last week showed Olmert's approval ratings slipping to 14 percent. It also showed his centrist Kadima party would lose nearly two-thirds of its strength in an election, which remains three years away, barring a major crisis.
But for Olmert or his embattled Defense Minister Amir Peretz, that could come in the form of yet another probe looking into their conduct of the war. The so-called Winograd Committee's interim report is expected to be out within weeks.
Nonetheless, Mekelberg says Israel's foes should not read too much into Halutz's resignation or Olmert's momentary political weakness:
"It's always a possibility that a weak leader actually will use more force than a strong leader," he notes. "Peace, most of the time, is made by strong leaders and not by weak leaders. And weak leaders, trying to show strength, will use military force."
Speaking to senior officers today, Halutz promised an "orderly transition" for his successor.
Appointed chief of staff in 2005, he will continue in his role until a new army chief is named. Israel Radio said Peretz is to present a candidate to the government on January 21.