Olmert’s calling it an “act of war” and holding the Lebanese government responsible. JPost describes the provocation:

Hizbullah launched a heavy barrage of Katyusha rockets and mortar shells at IDF positions and communities along the northern frontier on Wednesday morning starting about 9:15 a.m. One rocket scored a direct hit on a house in Shtula. Magen David Adom said they had treated six people so far. Both soldiers and civilians have been wounded. The wounded were being evacuated to Nahariya hospital.

According to the military, an explosive charge detonated under an IDF tank, inflicting casualties.

Haaretz notes the extent of premeditation:

Immediately following the Hezbollah attack, the organization’s Al-Manar television station began broadcasting clips calling on Israel to release Lebanese prisoners held in Israel.

Debka says the IDF knew it was coming but couldn’t stop it:

DEBKAfile’s military sources: Preparations for the Hizballah kidnap operation were sighted well in advance at its border positions. The attack did not therefore come as a surprise. Nonetheless the first IDF probe conducted after the attack found that a Hizballah commando unit transferred from its Baalbek base had managed to infiltrate the northern border, lie in wait for two Israeli Hammer jeeps patrolling the border, and blow them up at around 0900 a.m., injuring 6 soldiers, three critically.

IDF ground troops have crossed the border into southern Lebanon to search for the two. Debka says they’re encountering roadside bombs and missile forces, and alleges that special forces have been airdropped by helicopter into Beirut to intercept the kidnappers before they can find a secure hiding place. Meanwhile, infantry units and armored reserves are being called up.

But here’s the really interesting part, via Ynet:

Hizbullah even had a concrete offer, which binds the two kidnapping affairs – in the north and in the south: A release of the three kidnapped soldiers, including Corporal Gilad Shalit, in exchange for the release of thousands of prisoners, including Lebanese prisoners who are still held by Israel.

Either Hezbollah’s blowing smoke or they’re coordinating with Hamas — yet another example of Shiite and Sunni terrorists working hand in hand towards a common cause. Both organizations rely heavily on Syria for logistical support as well, a fact which is very much on the minds of the Israeli government:

From the IDF’s perspective, the entire “northern front,” as it is called in Israel, is involved up to its neck in the kidnapped soldier affair. Once and again Jerusalem has blamed senior Hamas members in Damascus for planning the abduction and have pointed a finger at Syrian President Bashar Assad, including launching aerial flights by IAF warplanes over his palace.

Is this it for Assad? One more fly-by for the IAF, but this time for keeps?

As for Gilad Shalit, he’s still alive according to the Arab newspaper al-Hayat, which has details about the conditions under which he’s being held.

There are sure to be updates throughout the day so I’m going to toss this into Top Picks.

Update: Nick Blanford of the Times of London reports on the mood in Lebanon:

[T]he capture of two Israeli soldiers fits perfectly with Hezbollah’s ideological goals but on a practical level, the group is also taking an enormous risk. Hezbollah is under an awful lot of domestic pressure from Lebanese who support its political movement but are unhappy that it remains an armed organisation. Today’s violence has invited a huge response from Israel.

That said, I’ve spent the morning driving through Shia villages in southern Lebanon where there has been a feeling of happiness and celebration. Children are flying yellow Hezbollah flags and cheering supporters have set up impromptu roadside stops to hand out sweets, a traditional gesture of celebration.

lebanon.jpg

Update: The IDF says it’s hit 30 targets in Lebanon so far this morning. The Lebanese prime minister demands that Kofi Annan stop the Zionist aggression.

Update: And Annan promptly rolls over. Good dog!

Update: Israel confirms that not only were two soldiers kidnapped in the attack this morning, three were killed. Update: Strike that. JPost says seven were killed.

Update: Fox says the State Department is calling the kidnappings an “act of terrorism.”

Update: Airstrikes are coming, says Reuters.

Update: Ynet says that of the seven Israeli soldiers killed, three died in the raid itself and four in the tank explosion mentioned at the beginning of this post.

Update: Euphoric Reality is hearing from her sources that the gloves will officially come off tonight when Israel formally declares war.

Just for context, Bill Clinton was quoted yesterday in Colorado as saying of course he’d talk to Hamas.

Update: It’s not just Israel that’s pointing the finger at Assad. The U.S. blames Syria and Iran for Hezbollah’s actions.

Update: Three makes it a trend: blame is being laid at the feet of Syria by none other than Hosni Mubarak.

Egyptian President Hosni Mubarak implicitly accused Damascus of wrecking his attempts to mediate a deal for the release of Cpt. Cpl. Gilad Shalit, snatched by Hamas-linked militants on June 25.

Hamas was subjected to “counter-pressures by other parties, which I don’t want to name but which cut the road in front of the Egyptian mediation and led to the failure of the deal after it was about to be concluded,” Mubarak told Cairo’s Al-Ahram Al-Massai newspaper.

Update: If this came from anyone else it would merit its own post. Debka says Ali Larijani, Iran’s chief nuke negotiator, is in Damascus right now pursuant to the Iran-Syria defense pact. The idea is to ensure that any attack on Syria by Israel will be treated as an attack on Iran.

A quick of the wires confirms that Larijani is, in fact, in Damascus. Take it away, Debka:

The Syrian army has been put on a state of preparedness.

DEBKAfile’s military sources add that the Iranian air force, missile units and navy are also on high alert.

DEBKAfile’s counter-terror sources report Hizballah acted on orders from Tehran to open a second front against Israel, partly to ease IDF military pressure on the Hamas in the Gaza Strip. This was in response to an appeal Hamas leader Khaled Meshaal made to the Iranian ambassador to Damascus Mohammad Hassan Akhtari Sunday, July 9.

DEBKAfile’s Iranian sources report Tehran’s rationale as composed of three parts:

1. Iran shows the flag as a champion and defender of its ally, Hamas.

2. Sending Hizballah to open a warfront against Israel is the logical tactical complement to its latest order to go into action against American and British forces in southern Iraq.

3. Tehran hopes to hijack the agenda before the G-8 summit opening in St. Petersberg, Russia on July 15. Instead of discussing Iran’s nuclear case and the situation in Iraq along the lines set by President George W. Bush, the leaders of the industrial nations will be forced to address the Middle East flare-up.

Update: I’m late with the news, but an IAF bomb completely demolished the Palestinian foreign ministry earlier tonight. Israel is bracing for reprisals in the form of long-range Hezbollah rockets capable of reaching some of its cities in the north, like Haifa.

Update: Is a third front about to open — inside Israel?

Update: Josh Trevino, a.k.a. Tacitus, looks into his crystal ball:

Israel left Lebanon: the Lebanese now attack Israel proper. Israel left Gaza: the Gazans now attack Israel proper. Israel walled off the West Bank: the Palestinians there elect Hamas. A pattern emerges.

And so, today, we see that what is old is new, and vice versa. Israel has invaded Lebanon and Gaza, reconquering what was conquered and given up once and more before. We know what will be done: Israel will flounder about for a bit and eventually withdraw once its captive soldiers — and most probably their corpses — are returned.

Update: Reuters reports that three shells have struck Beirut’s international airport. The article says they might have come from gunboats or Israeli aircraft. A banner up at CNN says it’s the latter, and they weren’t shells — they were missiles.