I’m meeting a retired Israeli general at a Tel Aviv hotel. As I take my seat, he begins the conversation with: “Well, everything we thought for the last 30 years is no longer relevant.”

That pretty much sums up the disorienting sense of shock and awe that the popular uprising in Egypt has inflicted on the psyche of Israel’s establishment. The peace treaty with a stable Egypt was the unspoken foundation for every geopolitical and economic policy in Israel for the last 35 years, and now it’s gone. It’s as if Americans suddenly woke up and found both Mexico and Canada plunged into turmoil on the same day.

“Everything that once anchored our world is now unmoored,” remarked Mark Heller, a Tel Aviv University strategist. “And it is happening right at a moment when nuclearization of the region hangs in the air.”

This is a perilous time for Israel, and its anxiety is understandable. But I fear Israel could make its situation even more perilous if it succumbs to the argument one hears from a number of senior Israeli officials today that the events in Egypt prove that Israel can’t make a lasting peace with the Palestinians. It’s wrong and dangerous.

To be sure, Hosni Mubarak, Israel’s longtime ally, deserves all the wrath being directed at him. The best time to make any big, hard decision is when you are at your maximum strength. You’ll always think and act more clearly. For the last 20 years, President Mubarak has had all the leverage he could ever want to truly reform Egypt’s economy and build a moderate, legitimate political center to fill the void between his authoritarian state and the Muslim Brotherhood. But Mubarak deliberately maintained the political vacuum between himself and the Islamists so that he could always tell the world, “It’s either me or them.” Now he is trying to reform in a panic with no leverage. Too late.

But Prime Minister Bibi Netanyahu of Israel is in danger of becoming the Mubarak of the peace process. Israel has never had more leverage vis-à-vis the Palestinians and never had more responsible Palestinian partners. But Netanyahu has found every excuse for not putting a peace plan on the table. The Americans know it. And thanks to the nasty job that Qatar’s Al Jazeera TV just did in releasing out of context all the Palestinian concessions — to embarrass the Palestinian leadership — it’s now obvious to all how far the Palestinians have come.

No, I do not know if this Palestinian leadership has the fortitude to close a deal. But I do know this: Israel has an overwhelming interest in going the extra mile to test them.

Why? With the leaders of both Egypt and Jordan scrambling to shuffle their governments in an effort to stay ahead of the street, two things can be said for sure: Whatever happens in the only two Arab states that have peace treaties with Israel, the moderate secularists who had a monopoly of power will be weaker and the previously confined Muslim Brotherhood will be stronger. How much remains to be seen.

As such, it is virtually certain that the next Egyptian government will not have the patience or room that Mubarak did to maneuver with Israel. Same with the new Jordanian cabinet. Make no mistake: The Israeli-Palestinian conflict has nothing to do with sparking the demonstrations in Egypt and Jordan, but Israeli-Palestinian relations will be impacted by the events in both countries.

If Israel does not make a concerted effort to strike a deal with the Palestinians, the next Egyptian government will “have to distance itself from Israel because it will not have the stake in maintaining the close relationship that Mubarak had,” said Khalil Shikaki, a Palestinian pollster. With the big political changes in the region, “if Israel remains paranoid and messianic and greedy it will lose all its Arab friends.”

To put it bluntly, if Israelis tell themselves that Egypt’s unrest proves why Israel cannot make peace with the Palestinian Authority, then they will be talking themselves into becoming an apartheid state — they will be talking themselves into permanently absorbing the West Bank and thereby laying the seeds for an Arab majority ruled by a Jewish minority between the Mediterranean Sea and the Jordan River.

What the turmoil in Egypt also demonstrates is how much Israel is surrounded by a huge population of young Arabs and Muslims who have been living outside of history — insulated by oil and autocracy from the great global trends. But that’s over.

“Today your legitimacy has to be based on what you deliver,” the Palestinian prime minister, Salam Fayyad, explained to me in his Ramallah office. “Gone are the days when you can say, ‘Deal with me because the other guys are worse.’ ”

I had given up on Netanyahu’s cabinet and urged the U.S. to walk away. But that was B.E. — Before Egypt. Today, I believe President Obama should put his own peace plan on the table, bridging the Israeli and Palestinian positions, and demand that the two sides negotiate on it without any preconditions. It is vital for Israel’s future — at a time when there is already a global campaign to delegitimize the Jewish state — that it disentangle itself from the Arabs’ story as much as possible. There is a huge storm coming, Israel. Get out of the way.