If it were just Israel against Hezbollah, I’d agree that Israel is not the underdog. But it’s not. It’s Israel against a wide swath of hatred that flows through the entire region. It’s Israel against al-Qaida, Hezbollah, Syria, Iran, Hamas, and radicals throughout the region. Furthermore, the enemies of Israel have learned that they cannot defeat them on the battlefield, and so they are practicing wide-scale guerrilla warfare, which does work well. And their biggest, most powerful enemy, which has sworn to destroy Israel, is working furiously to acquire nuclear weapons.
In addition, Israel has to fight against the tide of world opinion, because so much of the world is anti-semitic or at best indifferent to the plight of Israelis. And Israel is also hamstrung by its own civility - those who think Israel is indiscriminately killing civilians in Lebanon are nuts. If Israel wanted to, it could have killed tens of thousands by now. But it doesn’t. Its general decency prevents it from taking measures like bombing Tehran in relatiation for Hezbollah bombing Haifa.
The problem is that the ‘baiting’ involves the murder of Israeli civilians. No democratic government can just stand by and let its civilians be murdered by outside forces. Had Israel done nothing, the government would have fallen and been replaced by an even harder line government. Military action by Israel has the support of something like 95% of Israelis (down a bit now, but that’s where it was before the start of the Lebanon ground invasion). That means even a majority of Israeli Arabs favored military action.
You’re assuming that what motivates the Arab and Muslim world against the Israelis is fear. But it’s not. No one seriously worries about Israelis attacking Egypt or Jordan unless it is attacked first. Israel is simply hated for being Israel. It’s hated because it has been more successful than the Arab world, because it’s an enclave of Judaism in a Muslim region, and because it has repeatedly humiliated Arabs on the battlefield. The Arab world is mired in a pathology that is fueled by Arab leaders and militants alike. It’s not about fear of Israel - it’s about Arab dignity, Muslim purity, and the Palestinian problem being symbolic of perceived Arab oppression by Zionism.
Or another way to look at it - Israel gets attacked whenever it appears to be weak. The latest round of violence comes after Israel made huge, unilateral moves to disengage from Gaza, and after a left-wing government was elected that promised peace and planned to give up even more concessions. You think that this was working, and so the militants had to stir things up again to prevent it. The other viewpoint is that Israel’s enemies saw these moves as signs of weakness, and this stimulated the violence.
It’s not clear to me that refusing to be ‘baited’ would have calmed things down. More likely, it would have been a signal that Israel has no stomach for a fight, and might have caused the attacks to intensify.
There are just no easy answers here. The root problem is racism and hatred of Israel, and the pathology of Muslim extremism, Arab ‘face’ and tribalism. The Bush administration’s solution was to attack the problem on that side by attempting to turn the Arab world into a collection of modern democracies, on the theory that once they started making their own economic gains and tasting their own freedoms, hatred of Israel and the west in general would abate and militants would lose power. That’s looking like a failed policy to me, and I supported it. But if that truly does fail, then I’ve lost a lot of hope for a solution that isn’t going to involve an eventual bloodbath in the Middle East, and unfortunately for the Arab world, they’re the ones who are going to lose.