The head of Israel's opposition, Kadima Party leader Tzipi Livni, had it right when she said last Friday that Israel's southern border with Egypt was "no longer a border of peace.” She was referring at once to the complex attack across the Sinai border the day before by Palestinian terrorists, which left eight Israelis dead (six of them civilians, including two middle-aged sisters) and two dozen wounded, and to the Israel-Egypt peace treaty of 1979. The purport of Livni's statement was underlined by Egypt's announcement Saturday withdrawing its ambassador from Tel Aviv and demanding an Israeli apology for the death of three of its soldiers as a result of Israel's responses to the terrorist attack. (The Egyptians, under U.S. pressure, subsequently withdrew their threat to recall the ambassador, but are insisting on an Israeli apology and on compensation for the families of the Egyptian dead—though they have said nothing about compensation for the families of Israel's dead, due to their own negligence.) The Egyptians were also miffed at Israeli criticism of Egypt's negligence in allowing the terrorist raid, launched from Egypt's Sinai Peninsula, to take place.

The raid, mounted by 10–15 Palestinian fighters from the Gaza Strip's Resistance Committees, led to a flurry of Israeli counterstrikes against terrorists in Gaza and Sinai, and then to terrorist rocket attacks against Israel's southern cities, including Ashdod and Ashkelon.

Placing the weekend's events along the Sinai-Israel border in a wider regional context, it can be seen that the popular uprising half a year ago in the streets of Cairo and Alexandria which ousted the 30-year-old regime of President Hosni Mubarak is steadily, perhaps inexorably, leading to the unraveling of the peaceful, if very formal, relations that have reigned between the two countries since Anwar Sadat and Menachem Begin signed the treaty on the White House lawn. Such an unraveling bodes ill for the future of Israeli-Arab and Israeli-Muslim relations more generally.

The Egyptian populace, much of it supportive of anti-Israeli and anti-Semitic Islamist parties, has been educated to hate Israel since the establishment of the Jewish state in 1948, as much by the propeace regimes of Sadat and Mubarak as by its Nasserist and monarchical predecessors, and it was only natural that the clamor for the ouster of the dictator in the Arab spring would be accompanied by a rise in anti-Israeli agitation, including a call to tear up thae peace treaty.

Hence the weekend demonstrations outside the Israeli Embassy in Cairo, which included the burning of Israeli flags and demands for the severance of diplomatic relations with the Jewish state. This followed announcements by senior Egyptian officials that three Egyptian security personnel had been killed in the Israeli helicopter strikes in Sinai that followed Thursday's ambushes of Israeli buses and cars on Route 12, just north of the southern port city of Eilat. The Israelis were targeting the gunmen, who had fled back into Sinai and who allegedly belonged to the Resistance Committees, an ally of the fundamentalist Hamas organization that rules the Gaza Strip. The two groups have in the past jointly attacked Israeli targets, including in the famous crossborder raid in which the Palestinians took Israeli soldier Gilad Shalit hostage four years ago. It is unclear whether Hamas in any way aided the Resistance Committee raid, but Israeli observers noted that such a large, complex attack could not have been prepared without Hamas at least knowing what was in the works.

In one of Thursday's counterstrikes in Gaza, the Israeli Air Force managed to kill the leaders of the Resistance Committees, including the head of its military wing, Abu Awad a-Neirab; in other raids, Hamas was targeted. The Israeli counterstrikes also triggered stone throwing by Palestinian youngsters in East Jerusale which may presage the violence many anticipate when the Palestinian leaders are expected to announce Palestinian "independence" next month.

But the killing of the Egyptian soldiers, who apparently were standing next to several of the Resistance Committee terrorists, may prove more significant. The Egyptians reject the Israeli argument of "hot pursuit.”

The fact is that following the fall of Mubarak, Egyptian rule in the Sinai Peninsula has disintegrated. Egyptians seemingly no longer assiduously block clandestine Iranian shipments of arms into the Gaza Strip through the tunnel system, and the native beduin tribes of the peninsula, traditional smugglers of goods and people (mainly drugs and illegal emigrants from Sudan and Eritrea) into Israel, have prospered. A largely destitute Sudanese-Eritrean community now populates a part of southern Tel Aviv, where it is a source of crime and social unrest.

But more directly threatening to Israel has been the upsurge in Sinai in direct anti-Israeli activities by Islamist and Palestinian groups, some of them backed by Iran, such as the repeated sabotage during the past few months of the pipeline running the length of the peninsula through which Egypt exported gas to Israel (this gas constituted some 50 percent of the fuel that ran the turbines that supply Israel's electrcity grid. The gas disruption, which the Egyptian government has been unable or unwilling to halt, has meant that Israel has suffered economically and has had to access alternative supplies of gas and coal from elsewhere. One of the charges against Mubarak in the ongoing Cairo trial of the ex-dictator and his family and cronies is that they benefited financially from the gas deals). The interim Egyptian military regime has been extremely sensitive to Israeli criticism of its loss of control in Sinai.

Then came the Thursday attack in which the Palestinian gunmen made their way from Gaza through the Rafah-area tunnels into Sinai and then traveled south, ultimately crossing into Israel just north of Eilat, the Egyptian military in the area aware of what was happening and doing nothing to halt the terrorists. Israel suspects that the Egyptian soldiers may have helped the gunmen, either out of sympathy or for financial gain. Some Israeli survivors of the attack said that the terrorists were dressed in Egyptian army fatigues.

The irony is that a few days earlier, Israel had allowed the Egyptians—by mutual agreement breaching the Sinai demilitarization clause of the peace treaty—to send into Sinai three battalions of troops, with armored personnel carriers, to help restore Egyptian sovereignty and to curb the bedouin and Palestinian militancy. But the Egyptians, as had happened with the gas pipeline, either lacked the will or the competence, and the Resistance Committees' raid went on effectively and, apparently, on schedule.

The Egyptians are now demanding that Israel apologize and investigate the death of its soldiers. The situation is somewhat reminiscent of recent Pakistani castigation of the United States for killing Osama bin Laden and for hitting Taliban havens within Pakistan in drone attacks.

The difference, of course, is that the peace treaty with Egypt is, or at least was, a mainstay of Israel's strategic position, whereby it could rely on a safe and peaceful southern border as it confronted Palestinian, Lebanese Islamist and, potentially, Syrian and Iranian threats to the east and north. What with Sinai turning into a lawless center of Islamist militancy and Egypt itself moving steadily towards governance, or partial governance, by the Islamist Muslim Brotherhood, the parent organization of the Gazan Hamas, this secure southern border is fast becoming a thing of the past.

Israeli Prime Minister Binyamin Netanyhu has now promised to speed up the construction of a sophisticated fence along the border (akin to the existing fence along Israel's border with the West Bank, often mistaken called by anti-Israeli propagandists the "wall"), scheduled for the end of 2012. Originally, the idea was conceived to stem the flow of the illegal immigrants, most of them Muslims, into Israel. But it is now primarily seen as a means of keeping out terrorists, just like the West Bank fence. And, no doubt, Israeli strategic planners are already mulling over a more general reassessment, which may involve redeploying major IDF combat formations to the south.