Now that Israel and the PLO are on the verge of a historic peace agreement after 29 years of sullen silence punctuated by mutual hostility, shouldn't Washington follow suit?

At this point, a definitive answer to that question would be premature. After all, extremists on either side could still wipe out the recent progress and bring on renewed bloodshed.But if the Palestinian Liberation Organization sticks by its vow to renounce violence and abandon its threat to annihilate Israel, the United States can hardly take a tougher stance toward the PLO than Israel does.

Officially, the U.S. policy toward the PLO is to have no dealings with it. Unofficially, however, Washington has maintained informal contact with Yasser Arafat and other PLO leaders for at least the past four years.

A formal shift in U.S. policy would make sense for the same reasons Israel has changed its stance. The PLO is no longer the threat it once was. After Arafat backed Iraq in the Persian Gulf War, the PLO lost financial and political support among much of the Arab world. Meanwhile, other hard-line groups have become so fanatical in their opposition to Israel as to make the PLO at its worst look tame by comparison.

By starting formal contacts with the PLO, Washington could not only give Middle East peace talks a shot in the arm but also improve America's credibility in the eyes of Arab people.

One other point: A workable accord between Israel and the PLO would justify a cut in U.S. foreign aid to Israel, long the biggest recipient of American assistance. The money saved could then be used to make friends for the United States in the Arab world.

Again, any such shift in U.S. policy hinges on the success of the new-found harmony between Israel and the PLO. Assuming the ultimate triumph of this accord, Washington cannot keep boycotting the PLO without playing into the hands of fanatical hard-liners in the Middle East.

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