(January 23) Here are four essential observations on the current situation:

1. Citing UN General Assembly Resolution 194 as a basis for Palestinian refugees to demand the "right of return" to Israel is essentially a fraud. The resolution, which is nonbinding anyway, was passed in a very specific context: instructing a UN Conciliation Commission on how to negotiate a resolution of the conflict.

This long-forgotten commission is one of scores of such failed attempts over many decades. There is no absolutely reason to hold that this resolution produced some unbreakable legal principle which must be implemented.

Yet that's not all- and the following ought to be read very carefully: Everyone has ignored the fact that this same Resolution 194 proposes UN rule over all of Jerusalem (explicitly including Abu Dis, Bethlehem, Ein Karem, and Motza) and all holy sites!

If, therefore, Resolution 194 is so sacred and important why isn't the Palestinian Authority demanding that all of Jerusalem plus Bethlehem and Al-Aksa mosque be put under UN rule?

Let's be absolutely clear on this point: The Palestinians are rejecting UN Resolution 194 by demanding east Jerusalem and Moslem holy sites just as much as Israel is doing so by rejecting a return of refugees.

One can only hope that Israeli government policy and media will make this point clear at every opportunity.

2. A remarkable letter to Yasser Arafat by every Palestinian political party has also been widely ignored by the media.

This January 13 proclamation by 14 groups - including Fatah, Hamas, Islamic Jihad and the People's (Communist) party - represents one of the most unanimous stances in modern Palestinian history. (For the full text, see http://www.jmcc.org/new/01/factionlet.htm.) The letter urges the continuation of the intifada, praised for bringing about national unity, "until it achieves its goals in expelling the occupation and extracting our national rights in freedom, independence and return.

"This victorious process is subjected these days to a US-Israeli conspiracy that aims to abort our process through the proposals made by President Clinton [which deny Palestinians'] rights in the land, Jerusalem and sovereignty and seek to consolidate the settlements and abolish the right of refugees in return."

The letter praises the PLO Executive Committee, led by Yasser Arafat, for rejecting these proposals and even shuns "the so-called security coordination [with Israel] regardless of condition."

It insists that the Palestinians are winning, that "our people are not tired," and that they realize violence "is the only path to force the Israeli enemy, regardless of who rules it, and the US administration, regardless of who leads it, to withdraw and recognize the rights of our people...."

Such declarations deserve notice because Western governments and media are still claiming that an Israel-Palestinian agreement can be achieved.

No doubt, if Ariel Sharon wins the election they will claim that as the only reason a peace treaty wasn't signed.

THIS VIEW is quite false. The peace process has failed because the Palestinian side refuses to accept any reasonable compromise even after the most painful, thoroughgoing and unilateral Israeli concessions. This rejectionist effort has not been imposed on Arafat but led by him and backed by every single one of his aides and advisers.

Such an outcome is not the fault of Prime Minister Ehud Barak, and it won't be the fault of Sharon if he wins the February election.

3. Last November I met a senior US administration official who insisted that Israel must do everything possible to keep the PA from political or economic collapse. He insisted that Israel should continue financial aid to the PA and open the door to Palestinian workers. When it was pointed out that such pressures are Israel's main means of forcing the PA to end the conflict and protecting itself from attacks, the official arrogantly insisted that he knew all about the workers and that they posed no danger.

Last week it emerged that the perpetrator of the Netanya bus bombing was a Palestinian who got through a security check because he had a work permit.

In some ways this story symbolizes the way Israel has been constantly advised to take risks and make concessions by those who do not understand the situation here. One can only hope - while simultaneously doubting - that they will learn from their mistakes.

4. But the Palestinians will have to carry out their struggle without much Arab aid. The Arab League's pledge of $1 billion has now been shown to be a joke, with hardly any money delivered. Ironically, the PA is increasingly dependent on European aid to carry on its war against Israel.

Yet disputes over corruption and other issues, including human rights, could hold up this money as well.

And is the new US Congress and administration going to battle to continue current aid levels to the PA when it rejects US negotiations proposals, shows no real interest in reaching an agreement and breaks its promises of implementing a ceasefire?

Asked how they can possibly emerge better off from this deadlock, Palestinians privately assert that they have extraordinary patience. In other words, the Palestinians hope to wear Israel down and force it to make more concessions (without Israel getting anything in return) by continuing the violence and rejectionism for years to come.

It is worth noting, however, how sharply this contrasts with the image projected in the West that the Palestinians are suffering so greatly from the current situation - an image which carries the false implication that they are eager for a negotiated resolution.

If their circumstances are so miserable, why are they the ones demanding that those circumstances be perpetuated for an unlimited time?

If they are suffering so greatly from violence, why are they the ones determined to perpetuate the conflict using that same tactic?