Prime Minister Ehud Olmert on Sunday accused Defense Minister Ehud Barak of blocking cabinet debate on issues of security.

"Because of you, it is impossible to conduct a serious discussion on the defense establishment," Olmert told Barak during the cabinet's weekly meeting in Jerusalem.

The criticism came amid debate on the 2009 defense budget, which according to Olmert, was never even raised for cabinet discussion, after National Infrastructure Minister Benjamin Ben-Eliezer attacked the Treasury's proposal the cabinet decides whether to invest in defense or welfare. "We can't choose one over the other," Ben-Eliezer said. "Haven't we learned the lesson from Georgia?"

Neither was Ben-Eliezer left off Olmert's sarcasm. "Why not?" The prime minister asked. "I can assure you we will not attack Russia."

Ben-Eliezer did not seem amused. "If we cut the defense budget Israel will be weak," he said.

Referring to Barak's vocal criticism of UN Resolution 1701, which brought the Second Lebanon War to an end, Olmert said that "if some ministers spoke less of Resolution 1701 who brought nothing but peace and quiet to the north, we wouldn't be seen as weak."

Barak then interjected: "Does anyone have any complaints about the quietest six years [from the 2000 IDF pullout from southern Lebanon to the Second Lebanon War] we've seen?"

"Yes, but these were six years during which so many things were neglected," Olmert replied.

The Labor Party later said that "Olmert is in no position to give lessons while an entire country is still recuperating from the failed war he embroiled us in."

During the meeting, the prime minister also slammed Public Security Minister Avi Dichter for not doing enough to put a halt to organized crime in Israel.

Finance Minister Roni Bar-On, meanwhile, warned that the coalition must not let its "political games" influence the state economy.

"In the last few months we have worked hard to isolate the Israeli economy from the political game. Don't break this rule and do not turn Israel's economic policies into an instrument of factional taunting," Bar-On told ministers during the weekly cabinet meeting in Jerusalem.

"The building of economic faith is a long and arduous process which occurs bit by bit over the course of years, but takes just seconds to destroy," Bar-On warned.

Sunday's weekly cabinet meeting had been expected to set the stage for a tense verbal jousting session between the Labor Party, which objects to the Treasury's planned cuts, on one side, and Prime Minister Ehud Olmert and Bar-On on the other.

Olmert indeed called on ministers in his Kadima party to oppose the 2009 budget. The Labor Party also opposed the proposed budget, arguing that the suggested cuts would harm the weaker sectors of society.

"Israel doesn't have the luxury to cut the defense budget," Defense Minister Ehud Barack said saturday. "A responsible leadership must find a way to invest in both [defense and welfare] at the same time."

Transportation Minister Shaul Mofaz, who is in the midst of a race for leadership of Kadima, was also expected to oppose the proposed budget and demand that all discussions over the budget be postponed until after Kadima's primary, which is scheduled for September. Mofaz believes the candidate that wins the contest be given an opportunity to form a government and to exert influence over the budget framework.

Senior Kadima members noted that Mofaz's motive for requesting a delay stems from his desire to leave the budget open for discussion so as to allow greater flexibility in possible talks with prospective coalition partners should the former defense minister be tasked with forming the next government.

Foreign Minister Tzipi Livni is eager to see the government approve the budget before the primary, which would in essence limit the "extortion ability" of parties seeking to enter a coalition under her leadership should she defeat Mofaz.

The Treasury outlined its proposals during Sunday's meeting, with cuts in defense and welfare spending among the hot-button provisions.

Olmert and Bar-On were likely demand the ministers choose one of the two cuts before the budget is submitted to a vote next week. Senior Labor figures note that Mofaz is the key factor in the equation. If the transportation minister opposes the cuts, there is a strong likelihood that Bar-On and Olmert will be forced to offer a third alternative.

MK Tzachi Hanegbi, chairman of the Knesset Foreign Affairs Committee, and six subcommittee heads have sent a letter to Olmert and other senior government officials urging them not to cut the Defense Ministry's 2009 budget.

The letter stated that the ministry's current budget is a "red line that must not be crossed." Earlier this week, the Finance Ministry recommended cutting the defense budget by NIS 2 billion. According to the committee's letter, the Second Lebanon War "painfully demonstrates to all of us the price of neglecting the army and the cuts in defense-spending made in the years prior to the war."