The resignation yesterday of Yosef "Tommy" Lapid from Shinui, the party he led, marks the precipitous fall of a political movement that emerged from the last election as an improbable power broker and potential ruling party. Now, with its outspoken leader's premature retirement and his colleagues negotiating the terms of a very public divorce - while polls indicate their collective defeat - the question is: How did Shinui rise so high and why did it fail?

Socially, Shinui represented from its inception in 1974 the most Westernized, secular and affluent parts of Israeli society; people like co-founders Amnon Rubinstein and Uriel Reichman.

Legislatively, Shinui focused on reforming the electoral system, restructuring the national budget, freeing up the economy, separating religion and state, and seeking peace in return for land.

The last centrist party to achieve such success was Yigael Yadin's Democratic Movement for Change, which in 1977 won overnight 15 Knesset seats, only to completely unravel within three years. Shinui emerged from that rubble a minuscule, focused and highly principled faction that soon came to be seen as the Knesset's conscience.

Led in those years by Amnon Rubinstein, Shinui had only three lawmakers, but still managed to have an impact. When it headed the Communications Ministry it turned Bezeq into an independent company and thus touched off the telecom revolution that played a key role in modernizing the Israeli economy.

In the next decade Shinui found itself at the head of the Education Ministry. There, it deregulated the higher education system, thus opening the floodgates to a proliferation of dozens of new colleges across the country that have collectively raised sharply the number of educated Israelis, particularly among new immigrants. Finally, Shinui of those years also spearheaded the passage of Basic Law: Man's Dignity and Freedom, by far our most significant constitutional landmark in recent decades.

In sum, at a time when Israeli politics was dominated by the Likud-Labor rivalry, Shinui offered a refreshing, low-fat and high-principle alternative that insulted no one, and seldom even provoked anyone, with the noble exception of the Electric Corporation, whose employees' scandalous access to free electricity Shinui bravely challenged, and ultimately limited.

All this changed in 1999, when Rubinstein's successor at Shinui's helm, Avraham Poraz, handed his position to veteran journalist Lapid.

Under Lapid's leadership Shinui took a sharp populist turn, tapping into the centrist public's revulsion with haredi politicians' growing clout. In 1999 Shinui won a handsome six Knesset seats, and in 2003 an astronomical 15. At that point the party faced a supreme test of maturity, paradoxically similar to the one faced by its nemesis, Shas, back when that party won 17 seats, in 1999.

When parties win the support of so many voters, history calls on them to soften their ideology and demonstrate leadership, not just of their own flock, but the entire country. Shas failed this test, as it continued to focus on its narrow agenda without leading initiatives, or even thought, on major domestic and foreign policy issues.

This also happened to Shinui just when it achieved prominence in the political landscape.

As the largest and most loyal member of Ariel Sharon's original coalition, Shinui wisely harmonized with the National Religious Party and displayed managerial leadership and cleanliness in the five ministries it took over. Shinui also delivered on its promises to keep Shas out of power and dismantle the Religious Affairs Ministry.

Yet throughout it all the party remained so obsessed with anti-religious bickering that when it came to truly central national issues, Lapid's Shinui, unlike Rubinstein's, merely endorsed other party's plans, from privatization to disengagement, while otherwise emerging as a conservative factor.

As interior minister, Poraz merely tried to make the existing municipal system work, rather than empowering mayors and trimming the role of the central government. As deputy prime minister, Lapid failed to fight for faster and deeper tax cuts. And as a coalition partner, Shinui failed to even present, let alone pass, a vision for electoral and governmental reform.

Ironically, Shinui's reformist drive left a more lasting imprint on Israeli history when it was small than it did under Lapid.

Shinui's failure, therefore, was in its reformist lethargy, insufficient centrism and excessive rhetoric. Even so, the grassroots thirst for centrism and reform that raised Shinui to prominence in the first place will not disappear with its apparent demise. It will remain a potent force in Israeli public life, and come March 29 may in fact dominate it.