Tremendous victories were achieved by Israel in the 1967 War. Israelis called it a miracle. 

It slowly unravelled. 

The first unravelling was the "War of Attrition," which in essence was the attempt by Israeli Defense Forces (IDF), particularly the artillery and air, to prevent Egypt from rebuilding its military forces - the war machine it had built up before 1967 with immense Soviet aid.  While primarily costly in matériel, the real cost of this war forced Israel into dependency on American military aid. Prior to the Six Day War, Israel's leaders had done what they could not to openly rely too heavily on the United States for arms, though it had received heavy tanks from the States via aid to West Germany.

The main foreign supplier of arms to the IDF was France. When the French decided to side with the Arabs in 1967 this began to change. The political atmosphere in the States was favorable to the Israelis, and American Jews gloried in seeking to get aid for the nation that had given them a renewed sense of pride. Thus, almost unnoticed, Israeli sovereignty began to slip from the fingers of her leaders. The most fortunate event that occurred during this period was when the Israelis "acquired" nuclear material to make missiles. It was the one really good thing that Shim'ón Peres did in the service of his country.

The Beginning of Arab Terror

The second strand of the unravelling of the miracle was the beginning of Arab terror against Israeli civilians. The terror campaign had the initial effect of making the Arabs look evil and vicious - they blew up a school in Ma'alót, planted pencil bombs that would blow up in the hands of little children, and similar acts. Innocents were usually targeted. But this was accompanied with a well funded propaganda campaign to reverse the roles of the combatants, constantly referring to the Israeli "Goliath" overshadowing the Arab (and later, "Palestinian") "David."

The turning point in this campaign of terror - revealing the success of the Arab propaganda effort - was the reaction to the murder of the Israeli Olympic athletes in the 1972 Munich games by the Arab terror organization, Black September. As wrong as the terror attack might have been, the distribution of Olympic medals was far more important in the eyes of the corporate world than a terror organization bringing dishonor to the international games.  

The shedding of human blood, particularly of Jewish blood, did not matter if it got in the way of the great publicity machine hustling the Olympics. The murder of the Israeli athletes was turned as much as possible into another form of entertainment for the hungry masses. In addition, the Arabs were able to get a certain amount of sympathetic coverage, with the line "poor Palestinians driven to terror" being capitalized upon constantly. The Arab propaganda planted in the late '60's and early '70's has echoed through three and a half decades of murderous terror attacks, always being used as the excuse to cover them and give them legitimacy.