Changes in government in Lebanon and Egypt bring Israel closer to war, on two fronts. In Lebanon, Hezbollah has bullied and bribed its way into creating a majority coalition in parliament. While representing only a minority of Lebanese (most of the Shia), Hezbollah is backed by Iran and Syria (which is also dependent on Iranian cash). Lebanon has always been divided by religion (many different strains of Islam and Christianity) and clan politics. Long considered part of Syria, but what is, and was, Syria has been part of other empires for over a thousand years. In the 1940s, Lebanon and Syria were created by France, which occupied this part of the fallen (in 1918) Turkish empire for over two decades. Lebanon was to be a refuge for Arab Christians, but their emigration and low birth rate eventually made the Moslems a majority and that has upset the original political arrangement that kept Lebanon peaceful and prosperous. Now the militant Shia want to turn Lebanon into a religious dictatorship (as now exists in Iran). Most Lebanese don't want this, but are too divided to effectively oppose it. Hezbollah also wants Lebanon to go to war with Israel, something else most Lebanese oppose. At the moment, however, it would take another civil war (which, again, most Lebanese oppose) to stop Hezbollah.
To the south, revolution has overtaken Egypt. Triggered by a popular, and seemingly successful, uprising against the dictatorship in Tunisia, similar mass demonstrations have broken out in Egypt against the corrupt Mubarak dictatorship. A new, popular, government is liable to renounce the three decade old peace deal with Israel. While that deal includes annual bribes of over two billion dollars from the United States, Arab media has been denouncing that deal since it was made, and calling for the destruction of Israel. While Mubarak took the money and kept the peace, he also allowed state controlled media to continue vilifying Israel. A new government would have to deal with popular enthusiasm for another war with Israel. This would cost Egypt their annual American subsidy (to keep the peace), as well as earn the hostility of many aid donors and trading partners. Even with their American weapons, the Egyptians would lose another war. That's because corruption and poor leadership (officers selected more for loyalty to Mubarak than for military skills) has reduced the Egyptian army to riot police pretending to be soldiers. But it would cost Israel a lot (of lives and money) to deal with the armed mob coming at them from Egypt, especially if it happened at the same time Hezbollah unleashed another rocket attack from the north. A new government in Egypt would probably not tolerate Islamic terrorists hiding out in Gaza under Hamas protection, but would, for a while anyway, support Palestinian rule in Gaza and the West Bank, and a new Egyptian peace deal with Israel would have to be worked out. Probably without another war, but all those decades of anti-Israel propaganda have had an impact on most Egyptians. While Israel scrambles to resurrect discarded war plans, it's still not a sure thing that the Egyptian dictatorship is headed for extinction. A lot of wealthy and powerful Egyptians have a lot to lose (as close allies of Mubarak) if the dictatorship falls. Many of the protesting Egyptians realize that a new government could just turn into yet another dictatorship. About a hundred have died so far in the violence, and in the background deals are being made by a desperate, but resourceful, ruling class.
January 26, 2011: Recently leaked documents, from the current Palestinian-Israeli peace negotiations, show that the Palestinians have actually been trying to work out a deal. This has caused the Palestinian negotiators to be condemned throughout the Arab world as traitors. Fatah, the corrupt Palestinian party that runs the West Bank, and has been negotiating with Israel (at the insistence of the United States and other Western donor nations) in secret. But decades of Arab, and Palestinian, propaganda has been calling for the destruction of Israel. Palestinian officials openly call the negotiations mainly a ploy to make Israel look bad, and a way to keep Western nations subsidizing Palestinians. This makes the leaked documents media dynamite. Fatah negotiators call the leaked documents an Israeli plot, and so on. Meanwhile, Fatah has forbidden any "Tunisia-like" demonstrations in the West Bank. Most Palestinians consider Fatah just another Arab dictatorship.
January 25, 2011: Two rockets were fired from Gaza into Israel, and landed in empty land, causing no casualties or damage (except to the nerves of nearby Israelis).
January 20, 2011: Hamas has assigned 400 police to a special force for halting rocket attacks on Israel. Islamic terror groups that refuse to obey Hamas are responsible for these attacks, and the new police unit is supposed to be more than a publicity exercise. Hamas would like to cut down the power of these other terror groups (like al Qaeda and the Moslem Brotherhood), but has hesitated because some of these groups have powerful allies outside of Gaza.