Fatah mutiny is shifting PLO policies toward the gun

Desperate attempts by Palestine Liberation Organization Chairman Yasser Arafat over the past few days have failed to end the six-week-old mutiny by dissidents within his mainstream ''Fatah'' faction.

Instead, the rebels seem to grow more militant and more determined with every gesture of compromise or reconciliation that Mr. Arafat puts forward.

It now appears almost certain that the rebellion will dramatically alter the face of the guerrilla movement, with wide-ranging consequences for Middle East peace efforts.

For the first time since the dissidents broke ranks on May 7, Mr. Arafat has suggested major policy changes that would place more emphasis on the armed struggle than on moderate diplomacy in the campaign to win land for a Palestinian homeland.

On Monday, Abu Iyad, Fatah's second in command, announced an eight-point program of reforms to appease the dissidents. Most significant was a pledge to issue a declaration underlining the PLO's rejection of President Reagan's Middle East peace plan.

Previous PLO summits have condemned or criticized the US proposals, but never rejected them outright. This was in large part due to maneuvering by Mr. Arafat among the eight disparate factions of the movement.

But his preference for the olive branch over the gun - the two symbols he waved in the air during his 1974 United Nations appearance - has finally caught up with him. Mr. Arafat now appears to acknowledge he will have to pay a price for his increasing moderation for the sake of holding Fatah and the PLO together.

But long term, the price may end up being even higher for moderate Arab regimes, such as Saudi Arabia and Jordan, and Washington, since no peace plan can get very far without PLO support. And now the PLO chief is in no position to allow suggestions he might be interested in a negotiated settlement with Israel under US auspices.

And so far even the reform proposals have failed to entice the rebels to return to the fold. At an all-night summit in Damascus of Fatah's revolutionary council that broke up finally Tuesday morning, the mutineers failed to show up. In fact, more than one-third of the 73-member council boycotted the session, indicating the growing support for the extremists.

Fatah officials had earlier pledged to expel the rebels if they did not attend the meeting. But Mr. Arafat obviously did not feel in a strong enough position to make such a daring reprisal, for nothing was done. Nine of the rebels, including leader Abu Musa, are members of the revolutionary council.

The result of the summit, which was inconclusive, indicated that the political and military situation within the PLO is now wide open.

Equally ominous were the new clashes that broke out between supporters and opponents of Mr. Arafat, even before the summit ended, at Fatah bases in Lebanon's eastern Bekaa Valley. Beirut radio stations reported that the rebels had managed to take control of a major highway link near the Syrian border after artillery and rocket duels on Tuesday.

There were also reports that Libyan troops, who have been stationed in the Bekaa since the invasion last summer, were helping the dissidents. PLO officials have long claimed that Libya and Syria were aiding and covering for the dissidents because the pro-Moscow regimes also want to weaken Mr. Arafat's position and hopes for the Reagan plan.

Abu Musa and Abu Saleh both claim they do not want to split Fatah, only change its policies and tactics. Because Fatah is by far the largest faction of the PLO, with an estimated 80 percent, its decisions have traditionally held for the entire movement.

Mr. Arafat has tried to keep his head above water by moving many of the Fatah branches from Damascus, where they are under the Syrian thumb, to the northern Lebanese port city of Tripoli. But that has not helped significantly, since the problem goes much deeper.

Palestinian officials have begun to confirm in private that the seeds for the rebellion have been around for a long time. ''Abu Ammar (Mr. Arafat's war name) was simply getting too close to the Americans,'' one commented. It was a suspicion deepened when the PLO chief agreed to the evacuation of his forces from Beirut after the Israeli invasion under a US-designed plan.

In the eyes of many PLO members, their doubts about US intentions were confirmed when, just two weeks after the evacuation, Palestinian civilians were massacred in Beirut camps. Many hold Mr. Arafat and the US indirectly responsible.

There are deep fears, particularly among the so-called second generation of fighters who make up the majority of the PLO now, that a broader US peace plan would also have broader and more dangerous consequences for the PLO. The rebellion is, in effect, an attempt to keep Mr. Arafat in check.