Network reliability and security

My first trip to Washington DC in almost a year, and things are as weird as ever. One topic which kept coming up Internet security, and the possibility of someone with hostile intent disrupting the Internet. My theory and experience is these attacks, while devastating to individual networks and sites, have extremely localized affect. If you are just a few networks removed, you don't see much collateral affects. Now some folks are pointing to the current "cyber-war" going on in the Middle East as evidence great plans must be made. I poked around a bit, and yes, some sites and networks have severe problems. But it had essentially no affect on Internet performance outside the immediate area. What are network operators experiencing?