So Mubarak is gone. I didn't think it would happen so soon, but it was obvious he was going - after all, he was preparing to quit even before the demonstrations began. Let's hope he saw to it that there would be no chaos after he's gone.
Mubarak was no friend of Israel. He was an important ally, who shared some interests with us, but in some respects he was bad for us. his departure opens up dangers, but also hopes.
So what happens now? Here is my prediction, based on what I see and read.
I believe the Egyptians will eventually (after much haggling and some violence) manage to draft a new constitution, and will have democratic elections. The Muslim Brotherhood will keep a low profile for now, will not run a presidential candidate, will win about 20% of the seats in the Parliament, and sit in the opposition. There will emerge a relatively secular and moderate government, which will obviously have to deal with massive problems.
The peace with Israel will not be annulled, but the relationship will be cold and hostile (not much change there, then), and the discussions will be held on a military level. The Egyptian people don't like Israel, but they will not be happy about going to war with it, so the new government will have an interest to maintain the peace. Same goes for the army, that is dependent on American money.
In Gaza, our situation will change for better and worse. Mubarak played a cynical game, closed the border with Gaza, and lay all responsibility for it on Israel. The new Egyptian government will not be able to do so. They will open up the border (which will take pressure off Israel), and form political and financial ties with Gaza. The Israeli wish of breaking away from Gaza will finally come true.
The Muslim Brotherhood, in the meantime, will be in the opposition, and allow the Egyptian people to get tired of their government. When it suits them, they will use Hamas to provoke Israel, thus creating a wave of anti-Israeli sentiment in the streets, and ride it to gain more popularity. The eventual goal is of course to take over Egypt, and the fundamentalists know that they hold the stronger hand, so they can play it patient.
But we can find answers to that as well. If Egypt develops a stronger connection with Gaza, we can use diplomatic means to get it to restrain Hamas. Israel will have to develop a less aggressive and more diplomatic strategy against Gaza, and that's basically good. We must remember that one of Israel's biggest fears was that if we let Hamas succeed more than the Arab armies did, it will prompt the Egyptian masses to overthrow Mubarak, put the Muslim Brotherhood in power, and open war. That is why Israel felt compelled to be over-aggressive against Hamas, to give it absolutely no victories. But if Egypt now has a government that is more acceptable to its people, we don't have to be so anxious about not allowing Hamas any victories.
Like I said, the Muslim Brotherhood holds the stronger hand. The Egyptian people are religious, uneducated (one third of the population is illiterate), economically undeveloped, and have no democratic tradition - not the traits that would enable the rise of a thriving democracy. It is also highly Antisemitic, afraid of Israel and hates the West, other things that the Muslim Brotherhood can exploit. But on the other hand, even the small amount of freedom is a taste that is hard to erase, and if the Egyptian people get to experience it, they can get addicted. When the Brotherhood finally make their grand bid, they might be shocked to find out that they no longer hold the better hand. And if they do manage to take over some years from now, we will be facing an enemy, but we are strong enough to contend, and wait until the Egyptian people rise again, to regain their lost freedom.
The game in the Middle East has changed. It is now an inner struggle in the Muslim world, between the forces of democracy and the forces of fundamentalism. It is already going on in Pakistan, Afghanistan, Iran, Iraq, Turkey, Lebanon, the Palestinian Authority, Tunisia and Egypt, and it will spread further. In the other countries there are still dictators who are holding these two forces down, but they are going to fall as well. Looks like Algeria might be next.
All of this demands of Israel to change its strategy. No longer to try to reach peace deals with Arab dictatorships, but to think in longer terms. Our goal should be strengthening the forces of democracy, and weakening the forces of fundamentalism. In the long run, this is our only chance to have a normal existence.