In a defiant speech, Israeli Defense Minister Amir Peretz vowed that Hezbollah will "not return to what it was" and that Israel's offensive in Lebanon is the fate that awaits "anyone who attacks Israel."
In a joint news conference with Peretz, the army's chief of staff, Lt. Gen. Dan Halutz, said the strategic damage to Hezbollah from Israel's 16-day offensive is "enormous."
Despite the loss of nine soldiers Wednesday, troops heading up to Lebanon are determined to continue.
"I feel fine about it, I feel like I'm doing what I need to do, doing my duty," Tamir Goldberg, who immigrated to Israel from Dallas six years ago, told . One of four crew members, Goldberg says he feels relatively safe in his Merkava tank.
Also Thursday, al Qaeda's No. 2 leader warned in a new videotape that the terrorist group would not stand idly by while Israeli bombardments "burn our brothers" in Lebanon and the Gaza Strip, and Israel's justice minister said his country had received permission from world leaders to hit Hezbollah harder.
In other developments:
Halutz said Thursday's government decision to authorize the call up of tens of thousands of reserves was not meant to threaten anyone but rather to make the army ready for "all possibilities."
So far, 17 days of bombardment and recent, intense ground fighting have been unable to stop Hezbollah rocket attacks. More than 4,000 rockets have been fired into Israel in the past two weeks.
The Israeli military warned Lebanese in the south Thursday that their villages would be "totally destroyed" if missiles are fired from them.
Peretz said that the Jewish state "will not allow the Hezbollah flag to be flown on the borders of Israel." However, he also said that Israel had no intention of waging war against Syria, which is a prime support of Hezbollah.
The decision by Israel not to expand the offensive was not a surprise, reports CBS News correspondent Charlie D'Agata in Jerusalem.
For the past couple of days, Israeli commanders have been hinting that they weren't going to push Hezbollah out of southern Lebanon. Rather, they were going to change tactics and encircle some of the Hezbollah holdouts
"Where we've seen some of the toughest fighting is on that hilltop village of Bint Jbail. They say there are something like 200 hard-core Hezbollah fighters that simply will not let that position go, and that's where the Israelis have suffered their worst losses," says D'Agata.
However, while the ground offensive may not be increasing, D'Agata says the air campaign is.
"Most of the air strikes of that past couple of weeks have been centering on southern Beirut. These are areas known to be Hezbollah strongholds, but the ferocity of the air strikes suggests that the Israeli military just wants to keep up the pressure," says D'Agata.
The decision to activate more reserves came as Israel's justice minister said that world leaders, in failing to call for an immediate cease-fire during a Rome summit that ended Wednesday, have given Israel a green light to push harder to wipe out the Lebanese guerrillas.
That was a "gross misunderstanding," Germany's foreign minister said, insisting the declaration did not indicate that Israel should continue its offensive in Lebanon.
The high-level conference of key Mideast players in Rome ended in disagreement: Most European leaders urged an immediate cease-fire but the United States was willing to give Israel more time to punish Hezbollah and ensure an international force can move into south Lebanon to keep the peace.
"We received yesterday at the Rome conference permission from the world .... to continue the operation, this war, until Hezbollah won't be located in Lebanon and until it is disarmed," Israeli Justice Minister Haim Ramon told Israel's Army Radio.
"I would say just the opposite — yesterday in Rome it was clear that everyone present wanted to see an end to the fighting as swiftly as possible," Frank-Walter Steinmeier told reporters in Berlin after addressing a parliamentary committee.
Steinmeier said that nobody had expected to reach consensus on whether to send a stabilization force to Lebanon's northern border with Israel.
"Everyone understands that a victory for Hezbollah is a victory for world terror," said Ramon, believed to be close to Israeli Prime Minister Ehud Olmert.
In the message broadcast by Al-Jazeera television Thursday, Ayman al-Zawahri, second in command to Osama bin Laden, said that al Qaeda now saw "all the world as a battlefield open in front of us."
The Egyptian-born physician said the Hezbollah and Palestinian battles against Israel would not be ended with "cease-fires or agreements."
"It is a Jihad for God's sake and will last until (our) religion prevails," al-Zawahri said. "We will attack everywhere."
Al-Zawahri wore a gray robe and white turban. A picture of the burning World Trade Center was on the wall behind him along with pictures of two other militants.
"It's a slicker look for al Qaeda's number two, who delivered his latest video message from what appears to be a professional television studio, complete with background props," reports CBS News chief foreign correspondent Lara Logan.
"Just as Hezbollah tried to hitch its wagon to the Palestinian cause, the al Qaeda message from Ayman al-Zawahri is an attempt to galvanize the radical Muslim world, an attempt to unify the message," said CBS News foreign affairs analyst Pamela Falk. The message "is no surprise, and it is more of a message to hobbled al Qaeda forces than to world leaders, but it is not likely to convince anyone that there is unity among the terrorist groups."