"The legitimate rights of the Palestinian people" -- The phrase has a nice ring to it. But the reality is that more Palestinian Arabs live east of the Jordan River than west. This is why both presidents Carter and Reagan have stated that the legitimate rights of the Palestinian people must find a link across the river to Jordan. An Arab political presence in the West Bank and Gaza cannot be separated from Jordan. This is the first reality with which any plan for a solution must deal.

The second is that Israel's presence in the West Bank and Gaza has endured since 1967 and will not totally disappear as long as Israel exists. While the Arab world was living by the Khartoum slogan of no recognition, no negotiations, no contact, the Israelis began to populate the West Bank and Gaza. With a large number of settlements now in place and more in the offing, no elected government of Israel will be able to agree to a complete Israeli withdrawal.

The reality of Israel's settlements has not been lost on its neighbors. It is the specter of Israel's settlement policy, not the attractions of the Reagan plan, that recently moved King Hussein and Yasser Arafat to seek a common ground for negotiations with Israel.

The third reality is Israeli dynamism. Israel's willingness to take risks in furtherance of its national interests is in marked contrast with the unwillingness of moderate Arabs to incur the displeasure of their hard-line Arab neighbors by challenging Israel at the peace table. Whatever Prime Minister Menachem Begin's detractors may think about his breathing the haunted air of revisionist Zionist ideology, they cannot deny that he is a leader with a cause and a plan to accomplish it.

Israel's claim to sovereignty over the West Bank and Gaza is sure to be rejected by the Arabs living in those areas, who number 1.2 million and make up more than 95 percent of the inhabitants. This, too, is a reality.

A final reality, for those committed to a democratic and humane Israel, is the threat that the permanent military administration of the West Bank and Gaza will undermine the principles on which Israel was founded.

Do these realities create a framework for peace? I think they do, provided there is recognition of the changes that have taken place since the signing of the Camp David Accords 41/2 years ago. The parties have yet to agree on the means for setting up the self-governing authority in the West Bank and Gaza whose establishment was to mark the beginning of a five-year transitional period. In the meantime, the situation on the ground has changed in Israel's favor with the establishment of additional settlements and the demise of the PLO as a military force after its evacuation from Beirut.

Now is the time for the United States to outline a framework for the final status of the West Bank and Gaza. The Arab inhabitants of the West Bank and Gaza would be asked to approve in a referendum the broad outline of such a framework. The referendum would take place before, not after, detailed negotiations on its implementation. An affirmative vote would give King Hussein and other Arabs participating in ongoing negotiations the authority to represent the Arab inhabitants--something that has been lacking until now.

The framework would look like this:

4 About 400,000 Arabs living on the West Bank are already citizens of Jordan. The remaining Arabs there and in Gaza should be offered the same opportunity. This would remove the issue from one of sovereignty, which is so difficult for Israel, to citizenship. With citizenship would go the obligation to pay taxes and perform military service as well as the right to vote and receive social benefits. The issue of sovereignty would be left in abeyance. After all, the land is inanimate; it is neither free nor enslaved, only people are.

5 Those government functions normally performed at the local or regional level would be the responsibility of the Arab inhabitants. These would encompass the administrative functions already agreed upon by Israel's and Egypt's representatives in the negotiations held under the Camp David Accords and would be consistent with the accords' autonomy concept.

Israelis would have the right to live anywhere on the West Bank and Gaza, but no new Israeli settlements would be created through the exercise of governmental powers. The dismantling of token Israeli settlements in close proximity to the heavily populated Arab areas extending north of Jerusalem from Ramallah to Jenin would do much to remove the potential for future friction.

Israeli troops could remain only to protect Israel from foreign invasion, not to regulate the lives of the Arab inhabitants. The redeployment of Israeli forces would be consistent with this objective.

3 The Jordan River would be Israel's eastern security line, but not its national boundary. Arab inhabitants in the West Bank and Gaza would be free to travel to Jordan and back as well as throughout Israel, where many of them would continue to find work.

3 Jerusalem would remain an undivided city, but it should not offend Israeli concepts of sovereignty to acknowledge Jordan's status as a co-protector of the Holy Places, which encompass the Temple Mount and the Dome of the Rock, holy to Jews and Moslems.

Whether this framework or something like it can become the basis for negotiations will depend on two things. Moderate Arab leaders must face the reality of what has occurred and is likely to occur in the West Bank and Gaza, absent prompt agreement on the final status of the areas. Begin must withstand the hue and cry of hard-line Israelis intent on annexation.