I would have thought with former war hero Ehud Barak on board as Defense Minister, the Olmert Administration would have become a bit wiser when dealing with hostage crises. Unfortunately the recent "live murders for deceased hostages" idea must rank as one of the most foolish foreign policy ideas that I have ever heard. While the hallowed remains of fallen soldiers should always be sought out, the safety of the living must take top priority.
How should one deal with an international hostage drama? Never placate. Then should one command an immediate assault as soon as a hostage is taken? I suggest that the best first response is to not flinch. If it looks like you will rush to placate or to battle each time there is a hostage taken, then whenever the other side wants you to do something, it knows which button to press to get the desired results out of you. Rather there should be an understanding that there is likely to be a heavy price to pay in the near future for anyone who takes a hostage and does not repent before Israel acts to recover it's missing citizen(s). The first stage, when possible, should be a small task force assault to try to get the hostage out alive with as little collateral damage as possible. If the first stage fails, there must be an eventual military battle against the offending neighborhood, without primal concern for the safety of the hostage, because at this stage of the dilemma, national security must take priority over individual safety.
The terrorist kidnappers try to collectively hold the entire country hostage. This must never be allowed. If everyone knew that the entire neighborhood that the terrorists were hiding in would be at risk of being leveled, codependents to terroristic kidnappings would be few and far between.
The families of Israel should not be made to regret that their children died for such a foolish government. Rather it is the enemies of Israel who must be made to rue the day that they ever thought about kidnapping her citizens if she is to be protected from the risk of such evil ever reoccurring again. God protect us all.