Does the PLO recognize Israel?

No single diplomatic step would promise more for peace in Lebanon - and beyond - than Israel, the United States, and the Palestine Liberation Organization sitting down together. All sides have a fresh opportunity to bring this about by building on a remarkable series of events. These include:

* The unprecedented Paris statement by three Jewish elder statesmen calling for negotiations and the vigorous pursuit of mutual recognition between Israel and the PLO - followed by a welcoming PLO response to the statement.

* The unusual stress on addressing the plight of the Palestinians in George Shultz's confirmation hearings for the post of US secretary of state. He added that the US could consider talking with the PLO if it acknowledges Israel and its right to exist.

* The declaration by a PLO representative in Paris that ''the PLO has now formally conceded to Israel in the most unequivocal manner the right to exist on a reciprocal basis.''

* The statement by Senator Percy, chairman of the Senate Foreign Relations Committee, that he had confirmation of the reported new PLO position from a neutral source, the head of a nation friendly to the US.

It is easy to dismiss all this as atmospherics, and that is what it will turn out to have been if no one seizes the moment. Suppose, on the other hand, that everyone seizes the moment. Then it would not be totally beyond the realm of possibility for the US and Israel to sit down with the PLO as they did with Egypt - an occurrence that once seemed hardly less remote. Here are some of the things that could be done:

Yasser Arafat and other top PLO leaders could affirm what their Paris representative said about recognizing Israel. Previous reports of PLO willingness to recognize have too often been swiftly denied. PLO leaders could continue to argue that they cannot be expected to recognize anyone when their organization is not recognized in the first place. But they can hardly expect the US recognition called for in Paris without making their position clear at the highest level.

Israel could reconsider its drive to eliminate the PLO as a representative of the Palestinian people. The PLO could not credibly acknowledge Israel's right to exist without, as Mr. Shultz suggested, abandoning terrorist elements and violent threats to Israel. In that case, the widespread Palestinian and international acceptance of the PLO's representative role could facilitate negotiations in contrast with the so far futile effort to enlist other Palestinians in the Camp David talks.

The United States could accept the challenge, as urged by Senator Percy, to follow up on the apparent PLO shift toward recognizing Israel. Initial US reaction was understandably wary. But no other power has the same potential for nudging the other parties toward the negotiating table. Washington should miss no hint of an opportunity for fulfilling that potential.

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