Israel's leaders are walking a political tightrope in an effort to avoid a head-on collision with Egypt over the Palestinian issue -- while at the same time allowing an increase in the pace of Jewish settlement in the occupied West Bank.
These acrobatics also apply to the Jerusalem question, with Israel seeking to reassure Egypt's President Anwar Sadat that last week's parliamentary maneuver by rightwing deputy Geula Cohen did not constitute a change in policy.
The Egyptian perception of these activities, however, has been much more severe than anticipated here, culminating in a refusal to continue negotiations with the United States and Israel on automony for the West Bank and Gaza Strip.
A series of diplomatic approaches in Cairo and Washington may succeed in an early resumption of the three-way talks. But Israel is unlikely to modify its stand on either of the two matters at hand: settlements and Jerusalem.
On the contrary, authoritative sources here contend that the more Jewis settlers introduced into the areas earmarked for autonomy, the more difficult it will be to convert them into a Palestinian state.
Prime Minister Menachem Begin has made opposition to Palestinian statehood the cardinal objective of his negotiating strategy, reiterating it in almost every public appearance.
Opposition leaders, such as Victor Shem-Tov of the MAPAM (United Workers' Party) wing of the Labor Alignment group, discount the settlement policy as politically irrelevant and the Jerusalem measure as redundant.
"Even if 50,000 Jews were to move into the West Bank," the influential MAPAM general secretary said, "it would have no demographic weight against the million Arab residents."
He termed the Jerusalem proposal a "meaningless maneuver" intended to sabotage the autonomy negotiations with Egypt and the US, which it did.
Mr. Shem-Tov pointed out that the Knesset voted in 1967 that Jerusalem is to remain a "unified city" and that no further parliamentary action was necessary -- "just as there are no laws making Paris the capital of France," he said.
The Peace Now movement, which is sympathetic with Mr. Shem-Tov's MAPAM on Jewish settlements, has reacted to current government projects in the West Bank and Gaza Strip by announcing plans to establish communities of its own in prewar Israel -- namely, in Galilee and the Negev Desert area.
According to a highly placed Israeli source, the current acceleration of settlement activity marks the end of a period of temporary slowdonw in this process.
He said Israel tacitly restrained its prospective settlers throughout the initial phase of negotiations with Egypt on the bilateral peace treaty. This unannounced and ofent undetectable policy resulted in intermittent clashes with militant supporters of the Gush Emunim (Faith Bloc) movement demanding unrestricted options on West Bank land.
The government's reluctance to upset Egypt more than necessary culminated in a showdown with Gush Emunim over the controversial Elon Moreh settlement in the West Bank's Samaria district. $K$A Supreme Court decision forced the settlers to transfer to an alternative site, but this juridical outcome was also a boon to the government's negotiating stance.
Now, officials here admit, a race against time is under way, with transparent encouragement of settlement efforts designed to boost the number of Jews residing in the West Bank before final decisions are reached on autonomy. To this end, 5,000 Jewish families are awaiting the green light to pitch camp, according to Zionist aides.
Government-sponsored settlements in the West Bank are generally based on principles set forth a year ago by the head of the World Zionist Organization's settlement department, Matatyahu Drobles. These call, in effect, for holding Judea and Samaria permanently by means of accelerated Jewish settlement.
Exacerbating the government's tightrope effort is the upsurge of civil disobedience in the occupied areas.
This situation has led to a severe crackdown by troops and police, dramatized by the expulsion last month of three prominent figures from the Hebron sector -- the city's mayor, its religious Muslim judge, and the mayor of nearby Halhoul.
The three were expelled under controversial circumstances (they reportedly were told that a helicopter flight that brought them to southern Lebanon was to facilitate a rendezvous with Defense Minister Ezer Weizman), following immediately after the slaying of six Israelis and the wounding of 17 others. Israel's Supreme Court on May 20 ordered the government to justify the expulsion of the three Arabs and criticized it for not giving the three a chance to appeal before deportation.