NEWS ANALYSIS : As Fear Stalks the Streets of Israel, Hope Is Its Victim : Mideast: Amid a rash of attacks, a drop in morale is weakening Rabin’s ability to make peace with the Arabs.

Amid the flash of knives and the harsh bark of automatic rifles, Israelis’ hopes for peace with their Arab neighbors are fading fast.

With ever-sharper clashes between Israeli troops and Palestinians in the occupied Gaza Strip and West Bank, and a rash of terrorist attacks in Israeli settlements and cities, the fear is growing that any peace would prove false.

Israelis who six months ago expected an early peace treaty with Syria, their nation’s most dangerous foe, now worry that the price--withdrawal from the Golan Heights--will be too high, that even a pullback from the 20-year-old cease-fire lines there will jeopardize the country’s security.

Those who envisioned an accommodation with the Palestinians--self-government as a start, perhaps with a Palestinian state to follow--ask whether a moderate Palestinian leadership would be able to protect them against the murderous attacks of vengeful hard-liners opposed to any compromise.

And perhaps the trend toward militant Islamic fundamentalism through most of the Middle East will undermine whatever agreements might be reached.

The catalyst for this change in mood, as evident in coffeehouse conversations and street-corner chatter as in newspaper editorials and analyses by Middle East specialists, has been the surge in terrorist attacks on Israeli civilians at work, at school and on the street--with no reassuring progress in the Arab-Israeli negotiations in Washington to offset it.

Eight Israelis, most of them civilians, have been killed this month, and 14 have died this year, a casualty rate that is 2 1/2 times the average through the five years of the intifada , the Palestinian rebellion against Israeli rule.

The casualties on the Palestinian side are equally telling. An average of one Palestinian has been killed each day this month, one of the highest casualty rates since the intifada began. About a third of those killed are children under 16, according to Palestinian and military reports.

“We are all mindful, painfully so, that violence begets violence,” Dr. Haidar Abdel Shafi, the chief Palestinian delegate to the Arab-Israeli peace talks, said this week. “We feel ourselves being pulled deeper and deeper into that cycle. That Israel responds with disproportionate force, excessive force, leads Palestinians to resort to more force. . . .

“Our people’s confidence in the peace process diminishes as they see the violence around them increase. It gets harder and harder to continue that process. And this, too, unfortunately, leads to greater violence.”

Among Israelis, the psychological impact of the greater violence has been dramatic. More than 85% of Israelis surveyed in an opinion poll this month said they fear terrorist attacks against themselves or members of their family. That is one of the highest levels of anxiety in recent years.

Although pronounced defeated by the country’s generals six months ago, the intifada has become a daily worry for Israelis. Terrorist attacks have brought the front line up from the Gaza Strip and in from the West Bank to the streets of Jerusalem and Tel Aviv.

“Israeli citizens are now witness to one of the most serious waves of terror in the history of the state,” says Ze’ev Schiff, a military analyst for the influential newspaper Haaretz. “Even though it is primarily unorganized terror, the knife-wielding (attackers) have scored a success.”

But it was precisely Prime Minister Yitzhak Rabin’s promise to maintain security as he brought peace that won the parliamentary elections for his Labor Party last June.

“The people of Israel have a perfect right to be furious with their present government,” Shubert Spero, professor of Jewish thought at Bar Ilan University, said this week. “From the prime minister on down . . . we have seen gross insensitivity to our personal security needs to a degree unprecedented in the entire conflict-ridden history of this country.

“At this point, it is difficult to say whether it emanates from sheer stupidity or masks devious dishonesty. . . . But it is certainly and in great measure the inevitable outgrowth of the irresoluteness of several Israeli governments.”

Rabin’s ability to negotiate peace depends first on maintaining a national consensus in the face of such criticism. Israelis must accept, Rabin reminds them over and over, that security ultimately requires a negotiated peace with the Arabs--predicated on their acceptance of Israel--because the present military standoff cannot be maintained indefinitely.

Yet, after half a dozen wars over 45 years, Israel’s security is measured day by day and very much in personal terms, and the palpable drop in morale weakens Rabin’s ability to conclude agreements with the Arabs and then to sell them to the Israelis.

“Intellectually, I know that I am at far greater risk on the road from Jerusalem to Tel Aviv, but emotionally I don’t feel safe on the streets of either city after these recent stabbings,” said Rachel Bloom, a history teacher active in the Peace Now movement. “There is something in these attacks--maybe it is the image of the knife in the back--that makes me feel not just vulnerable, but violated myself. I feel myself a victim of each attack.”

These fears are amplified by spreading hysteria, increased by those who oppose negotiations with the Arabs and who are not at all calmed by the government.

Gun sales have risen following a call by the country’s police commissioner for Israelis to arm themselves. Men and women who used to carry their weapons discreetly, or leave them at home, now carry them openly as a deterrent.

Right-wing members of the Knesset, Israel’s Parliament, this week called on people to use deadly force in halting terrorist attacks.

“When a murderer is brandishing a knife, the people who catch him before he surrenders should make sure that the man doesn’t come out of it alive,” the Likud Party’s Uzi Landau said.

“This is a war situation where we are being shot at, where previously it was a matter of stabbing and before that of stoning,” said Yisrael Medad of the settler movement Yesha. “The policy of the settlers is to defend themselves--and when faced with life-threatening situations to kill in order to defend. This means knives, grenades, guns.”

An Israeli settler on the West Bank, an American immigrant, shot and killed a Palestinian this week when the man was bound hand and foot because, as the settler reportedly told police, “the Arabs have to be taught a lesson.” Yesha supported his action.

Some settlers, declaring that “if we can’t live here in peace, neither can the Arabs,” began blocking roads with burning tires and stoning Palestinian cars this week. Military authorities warned that violent confrontations with Palestinian residents would likely result but did little to stop them.

In central Jerusalem, two young Arab women, both Israeli citizens, were set upon by a crowd as they shopped for new kitchen knives as a gift for their mother; even the police who rescued them did not believe that they were not planning to use the knives to “kill Jews” until their mother came to vouch for them.

Street attacks on Arabs have become frequent in southern Jerusalem, where Palestinians have repeatedly attacked Israelis. Some of the victims have been dark-skinned Jews.

Samuel Peleg, a political scientist at Tel Aviv University and Peace Now leader, predicts an increase in violence: “We are in an action-reaction cycle. Violence will increase before it eventually subsides. The question is, what will be the damage to the peace process?”

Ehud Sprinzak, a political scientist at Hebrew University and a specialist on the Israeli right wing, said extremists on both sides effectively encourage each other’s violence while moderates struggle to regain control.

“The Palestinian acts of terror are often provocations aimed at bringing about Jewish counteractions, which will then snowball into more violence and stop the peace process,” Sprinzak said.

Schiff went further, warning that the government is losing control over armed Israeli groups and that a “Jewish underground” could re-emerge to mount vigilante attacks on Arabs in the name of “self-defense.”

Rabin’s own ministers are grumbling about his handling of the crisis. Yossi Sarid, the environment minister from the leftist Meretz bloc, suggested pro-peace demonstrations to counter the rightists but was slapped down. Education Minister Shulamit Aloni, who is also from Meretz, said the government “is not clear enough and not bold enough” in saying what must be done.

Rabin himself continues to stress the need for a negotiated settlement with all the Arabs, including the Palestinians, and repeats his determination to pursue the negotiations and to fight the unrest and terrorism at the same time.

Israelis, he says, will have to take greater responsibility for their own security and that of their communities.

“I have no hocus-pocus solution, no magic cure, no simple answer,” he said this week, “and that is just the way it is. . . . This is a difficult period, but we will get through it. . . . When and how precisely, I can’t say, but we will, we will, I know we will.”

Bloodshed in the Holy Land

These statistics reflect the intense level of violence and bloodshed in Israel and its occupied territories up to March 24. The intifada is the Palestinian uprising against Israeli control begun in late 1987; Dec. 18 was the date when Israel, asserting that it needed to curb violence linked with Islamic fundamentalists, deported more than 400 Palestinians.

Palestinians killed by Israelis from start of intifada: 1,070 (Of these, 58 have been killed since Dec. 18; 20 in March)

Israelis (soldiers and civilians) killed by Palestinians from start of intifada: 126 (14 have been killed since Dec. 18; eight in March)

Palestinians killed by other Palestinians, apparently as suspected collaborators, from start of intifada: 712 (33 have been killed since Dec. 18; eight in March)

Six foreigners have been killed; none since Dec. 18.

Source: Times Jerusalem Bureau, Associated Press