JERUSALEM (Reuters) -The U.S. envoy to Israel said Prime Minister Benjamin Netanyahu should slow progress on a judicial overhaul that could make it harder for Washington to help him promote ties with Saudi Arabia or deal with Iran.
For weeks, Israel has been in uproar over Netanyahu's hard-right government's plan to carry through changes to the judiciary that critics say endanger the country's democratic checks and balances.
Israel's parliament may on Monday hold the first of three votes on a bill that would increase the government's sway in selecting judges while setting limits on the Supreme Court's power to strike down laws or rule against the executive.
"We're telling the Prime Minister, as I tell my kids, pump the brakes, slow down, try to get a consensus, bring the parties together," Ambassador Tom Nides told CNN podcast The Axe Files that was published late on Saturday.
While Nides said Israel had the United States' support on security and at the United Nations, he also said that Netanyahu's stated hope of forging diplomatic ties with Saudi Arabia or dealing with Iran's nuclear programme were at stake.
"The Prime Minister wants to do big things, okay? He tells us he wants to do big things," Nides said. "I said to him, to the prime minister, a hundred times, we can't spend time with things we want to work on together if your backyard's on fire."
Speaking at a conference bringing together leaders of major Jewish organisations, Netanyahu on Sunday did not directly address Nides' comments.
"All democracies should respect the will of other free peoples, just as we respect their democratic decisions," he said.
Israel's finance minister on Sunday said he expected the United States to stay out of Israeli domestic politics.
"We always made sure to not intervene in internal American affairs, and so I expect from the United States not to intervene in our internal affairs," Finance Minister Bezalel Smotrich told a news conference.
Diaspora Affairs Minister Amichai Chikli had a more contentious take on Nides, telling public broadcaster Kan: "I tell the American ambassador, you pump the brakes. Mind your own business. You are not sovereign here to discuss judicial reforms. We're happy to discuss diplomatic and security matters with you but respect our democracy."
Warning last week Israel is on the brink of a "constitutional and social collapse", President Isaac Herzog is trying to bring the government and the opposition together to agree on legal reforms and freeze legislation on the present plan, which has triggered nationwide protests.
A joint letter to the justice minister and leader of the opposition from eight of the largest investment banks that manage billions of shekels of public funds was published by Israel's N12 on Sunday.
Cautioning against the adverse economic effects of the overhaul, the letter urged "immediate dialogue" between the opposing political blocs.
"We have seen with concern the implications of the uncertainty on the financial markets and on the public's savings, and therefore call on all parties to show responsibility and leadership," it said.
Netanyahu, who is on trial for corruption that he denies, has said the changes are needed to restore balance between the government, the Knesset and the judiciary, which some in his coalition accuse of elitism and overreaching its powers to interfere in the political sphere.