Israel does need to try to prevent Hamas from shooting rockets, but the military option, if it results in a lot of civilian non-Hamas staff deaths will increase support for Hamas, not decrease it. While striking Hamas (and trying to keep the response reasonable to avoid excessive civilian deaths) Israel should also take moves toward peace. Peace will only come if Israel withdraws the settlements from the West Bank (with the possible exception of the ones around Jerusalem that Israel will probably not give up. It also probably needs a wall, but not one that annexes new territory. Some of the fanatical Jewish settlers, like the radical Palestinians - want to see fighting and death. The radical settlers realize that it can deter attention from the unfair actions in West Bank, where they hope to push out the Palestinians. Other settlers moved to the West Bank largely because it was cheap and convenient. If Israel took steps toward peace, many Palestinians would change from support to terrorism to support for peace. Egypt wanted to destroy Israel and moved to peace years ago. Syria is also ready for peace if Israel will return the Golan heights. The US has paid dearly for Israeli West Bank settlements - not only in budgetary support to Israel but in the resulting increase in enemies to the US around the world - in the Middle East, Pakistan and elsewhere. We will always guarantee Israel's right to exist, but that does not mean that we have to support grossly unfair actions. Israel isn't willing to make 4 million Palestinians citizens of Israel (they would have the balance of political power). So they have to either withdraw from the West Bank, expel the Palestinians or exterminate them. The US will have a role in convincing them to do the right thing.
For those of you who only read the politically correct US press, here is what the British BBC reported on the Israeli Prime Ministers comments Dec 7 characterizing actions by certain settlers as similar to a pogram against Palestinians.
Outgoing Israeli PM Ehud Olmert has compared the violence used by Jewish settlers against Palestinians in Hebron to bygone anti-Semitism in Europe.