Mideast's new start

FRIENDS of President-elect George Bush say that he has put the Middle East at the top of his foreign policy agenda and will make an early and earnest effort to reach toward a comprehensive peace between Arabs and Israelis. Both Arabs and Israelis are getting their respective houses in order for such a new initiative from Washington, almost as though they had been informed of the Bush intentions and are balancing for what may come.

The Palestinian Arabs have been meeting in Algiers. They have declared what amounts to a Palestine government in exile. They have declared themselves ready to negotiate under the terms of United Nations Resolution 242, which calls for the surrender of most of the occupied territories in return for Arab acceptance of the state of Israel.

The Israelis have achieved a government of the right with enough votes in the Knesset to be able to make peace - if they really wish to make peace.

This is the first time both Arabs and Israelis are positioned to make peace if they could agree on the terms. The Arabs want all of the occupied territories returned to Arab self-rule, with only some slight border rectifications. The Israelis are talking about the kind of local autonomy for the Arabs which was called for under the Camp David formula, but never granted. A Likud idea of areas suitable for Arab autonomy would be far less than the whole of the occupied territories.

It seems almost inconceivable that an Israeli government headed by Yitzhak Shamir could ever bring itself to give up direct control over what he calls Judea and Samaria or abandon the right to plant and keep Jewish settlements there.

Security might be less of a stumbling block than territory. The Arabs are not interested in having a new Palestinian state with an army. They want to be freed of life under the Israeli Army. Having one of their own would be unrealistic from any point of view, and certainly not important to them.

Israel has all along insisted upon having ``secure'' borders. That has often been interpreted by Israelis as meaning military control of all of the territories that are now inside their military periphery.

Yet it is not necessary for Israel to have control over the streets of Arab towns in order to have military security. One can conceive of a compromise formula under which the Israeli Army would have military positions and garrisons around the borders of the occupied territories and full freedom of communications between such military posts while letting the Arabs rule themselves inside an Israeli military frontier.

The problem of Jewish settlements inside predominantly Arab areas would be much more difficult. The Israelis have been insisting ever since the 1967 war on a right to reestablish a Jewish community in the city of Hebron, from which all Jews were expelled during the riots of the late '20s. There is today a small settlement of Jews in the very center of Hebron which is sustained by Israeli bayonets. Were the Israeli Army withdrawn from the city of Hebron, every Jew would have to leave.

In theory a trade-off is conceivable between security and settlements. The Arabs could probably be brought to tolerate Jewish military outposts around the borders of the Palestinian area if the Israelis would withdraw their settlements from inside and near to the major areas of Arab population. Local Arab autonomy without Jewish settlements could be a trade-off for Israeli garrisons around the fringes.

But to stitch a compromise together, Mr. Bush would have to be prepared to use American leverage on Israeli Prime Minister Shamir. And behind that is the key question whether the American Jewish community would allow an American president to use real pressure on any Israeli government. The ability to make peace in the Middle East lies in Washington.