Israel now has to worry about Egypt doing something stupid. Although deposed dictator Mubarak officially maintained the 1979 peace treaty with Israel, Mubarak also had the state controlled media constantly criticize Israel for real and (mostly) imagined crimes against Moslems. Mubarak allowed Hamas to bring in Iranian weapons and cash (for an eventual attack on Israel). Mubarak did what any dictator does, he found an external enemy to blame things on. But all of Egypt's problems are internal, mostly in the form of corrupt government officials and most of the economy controlled by a few hundred families. It's as the Russian czar said once, when asked about his great power, "I do not run Russia, 10,000 clerks do." It's the same in Egypt (or any other country). Replacing enough of the several hundred thousand officials (government and business), to really be in power, will be difficult for any reform politicians. Replacing all the current "clerks" with honest ones will be impossible. Eliminating corruption takes a generation or more, assuming you really try. There are centuries of history with that sort of thing, but Arabs tend to consult their own special history book, one found in the fiction section, and full of tales of imaginary Arab accomplishments, and a long list of self-inflicted injuries blamed on others. The fact is that Egypt, like most Arab nations, has long neglected education and economic opportunity. Literacy is only 71 percent, and corrupt officials make it impossible to start a legal business. Economic activity is monopolized by the several hundred families who see nothing wrong with crippling the economy for their own gain. The wealthy have not hesitated to use thugs and death squads to maintain their power. While often at each other's throats over business or personal matters, the several hundred thousand officials and business leaders will largely unite at any attempts to dismantle their economic arrangements. Bribes, threats and all sorts of enticements will be offered cripple the reform efforts. While most Egyptians demand reform, those benefitting from the current arrangements know that they have thousands of years of Egyptian history on their side. Occasionally, foreigners would take advantage of this culture of corruption, which extended to the army, and invade. But the Egyptian ruling class would soon absorb the invaders, and the business of running Egypt would return to its normal ways.
Israel knows well how corrupt the Egyptian armed forces are. Except for a few years before the 1973 war, when a highly efficient Anwar Sadat was running the army, the Egyptian armed forces have been allowed to wallow in their usual incompetent self-delusion. Peacetime armies have long been seen as perfect sources of wealth for corrupt politicians. Thus, in the last three decades, the Egyptian forces have done their job in this department. A new Egyptian government, seeking to gain domestic and foreign popularity by cancelling the peace treaty with Israel, would restore the threat of Egypt foolishly starting another war they would lose. Israel would have to redeploy its forces to deal with this. That would cost money, and weaken the edge Israel has in the north against Hezbollah and Syria. All this would not really change the balance of power. What might do that is reforms in the Egyptian military, to eliminate corruption and raise standards. Good luck with that.
Egypt may achieve reform, to include a sharp reduction in corruption and true rule of law. What is less certain is dealing with the effects of three decades of anti-Israeli and anti-Semitic propaganda in the state controlled media. But the biggest problems are internal, and solving those are a long shot.
Many Egyptians have doubts that democracy will work in Egypt. They point to Lebanon and Iraq as examples of what happens when you allow Arabs to use democracy to rule themselves. The 22 year old Lebanese democracy fell apart in 1975, followed by fifteen years of civil war, then a peace deal that left the country divided into the "democratic" north, with the south ruled by a Shia religious dictatorship (Hezbollah) financed by Iran. Iraq has a barely functioning democracy that many Arabs despise because it was facilitated by an American/British invasion to remove an Arab dictator. What Arabs really find discouraging about Iraq's democracy is that it reveals how difficult it is to run such a government. But as Westerners constantly point out, freedom isn't free and democracy isn't easy. If you want the goodies, you have to make the effort.
Meanwhile, Israel is having its own corruption problems. To Israel's credit, corrupt politicians, no matter how senior their positions, are prosecuted and punished. But this has included a growing number of military officers. Not a lot, but it has included some senior generals of late. This, and some nasty party politics, has delayed the appointment of a new head of the armed forces (chief of the general staff).
Meanwhile, up in Lebanon, the many factions are uncertain if they want to allow Hezbollah to take control of the government, and the armed forces. For many Lebanese, another short war with Israel is preferable to another decade of civil war with Hezbollah. To make matters worse, there have been an increasing number of power shortages in the last few days, as a result of a gas line explosion in Egypt a week ago. No one took credit for the explosion, which was officially attributed to a leak in the pipe that carries natural gas to Israel, Jordan and Lebanon. Israel and Jordan were able to find alternate sources, Lebanon was not. Pipeline repairs are expected to be completed in another week.
February 11, 2011: Hosni Mubarak, for 29 years the leader of Egypt, was forced out of office by nearly three weeks of popular unrest. Mubarak turned over power to his vice-president, a pro-American official, and the military.
February 10, 2011: Unidentified gunmen fired on a police station near the Gaza border. There were no injuries and no one took credit. Police have been fighting smugglers (who work the Gaza and Israeli borders) of late, and that conflict often gets very violent and the armed smuggler gangs seek to intimidate the police.
February 8, 2011; Israeli forces attacked a warehouse in Gaza, which was believed to be a rocket building workshop.
February 6, 2011: Two rockets were fired from Gaza into Israel.
February 3, 2011: In Egypt, the deputy leader of the Moslem Brotherhood admitted that cancellation of the 1979 peace treaty with Israel remained be a major goal if the Moslem Brotherhood gained control of the government. The Moslem Brotherhood, as its name implies, remains committed to religious rule in Egypt, but has learned to use democracy to reach that goal. Terrorism has failed several times in the past, and politics has been much more successful. Currently, the Moslem Brotherhood is the best organized and most determined opposition group in Egypt. Only a minority of Egyptians support the Brotherhood, but that support includes a lot of people willing to kill or die for the cause of religious dictatorship.
In Jerusalem, someone threw six gasoline bombs at Border Guards. The bombs did not go off, no one was caught and no one took responsibility for the attack.
January 31, 2011: A rocket was fired from Gaza into Israel.