The solution for Likud, then, should be obvious: remove Mr Netanyahu and share power with Blue and White.
But the problem is that Likud's members are in absolute thrall to their leader. The thought of losing him terrifies them. Likud now looks more like a one-man cult than a political party.
Mr Gantz, meanwhile, is gripped by fear of a different kind.
Without Likud, the only solution for Mr Gantz is to turn elsewhere for support. But that would make him reliant on the 13 seats of the Joint List, a coalition of parties representing Israel's large minority of Palestinian citizens.
And there's the rub. Blue and White is a deeply Arab-phobic party, just like Likud and Yisrael Beiteinu. Its only civilian leader, Yair Lapid, notoriously refused to work with Palestinian parties after the 2013 election before Mr Netanyahu had made racist incitement his campaign trademark.
Mr Lapid said: "I'll never sit with the Zoabis" a reference to the most prominent of the Palestinian legislators at the time, Haneen Zoabi.
Similarly, Mr Gantz has repeatedly stressed his opposition to sitting with the Joint List.
Nonetheless, the Joint List's leader Ayman Odeh made an unprecedented gesture last week, throwing the weight of most of his faction behind Mr Gantz.
That was no easy concession, given Mr Gantz's positions and his role as army chief in 2014 overseeing the destruction of Gaza. The move angered many Palestinians in the occupied territories.
But Mr Odeh saw the Palestinian minority's turn-out in September leap by 10 percentage points compared to April's election, so desperate were his voters to see the back of Mr Netanyahu.
Surveys also indicate a growing frustration among Palestinian citizens at their lack of political influence. Although peace talks are off Israel's agenda, some in the minority hope it might be possible to win a little relief for their communities after decades of harsh, institutional discrimination.
In a New York Times op-ed last week, Mr Odeh justified his support for Mr Gantz. It was intended to send "a clear message that the only future for this country is a shared future, and there is no shared future without the full and equal participation of Arab Palestinian citizens".
Mr Gantz seems unimpressed. According to an investigation by the Israeli media, Mr Netahyahu only got first crack at forming a government because Mr Gantz blanched at the prospect.
He was worried Mr Netanyahu would again smear him and damage him in the eyes of voters if he was seen to be negotiating with the Joint List.
Mr Netanyahu has already painted the alternatives in stark terms: either a unity government with him at its heart, or a Blue and White government backed by those who "praise terrorists".
The Likud leader might yet pull a rabbit out of his battered hat. Mr Gantz or Mr Lieberman could cave, faced with taunts that otherwise "the Arabs" will get a foot in the door. Or Mr Netanyahu could trigger a national emergency, even a war, to bully his rivals into backing him.
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