While trying to tone down Arab anger about the soaring Palestine death toll, President Bush has delivered a tough message to Israel that the United States will not twiddle its thumbs while Israel's prolonged effort to form a government creates a dangerous Mideast political vacuum, possibly inviting war.

That message coincides with demands in congressional committees for a stop to killings and beatings of Arabs, the opening of Palestinian universities and an end of harsh detention measures that produced eye-popping testimony on Capitol Hill earlier this month.

Israel's internal political wars have put the peace process ''in hiatus,'' an administration official said privately, adding that the president cannot allow it to stay there. Thus, the next few weeks are either going to galvanize Israel into creating a government capable of working for West Bank-Gaza peace or divide the United States and Israel as never before.

Bush's signals to Israel are believed to be having a somber impact on the beleaguered Israeli population. Most Israelis are aware of the increasing need for U.S. political and financial sustenance in a world turned unfriendly to the Jewish state's policies toward Palestine.

Bush made a public stir when he telephoned Egyptian President Hosni Mubarak May 23 after seven Palestinians were shot and killed in Gaza by a ''deranged'' former Israeli soldier. But there was no Bush call to caretaker Prime Minister Yitzhak Shamir, the hard-line Likud leader who, like Labor boss Shimon Peres, seems unable to form a new government.

When Arab states went to the United Nations for help on what they believe to be a major threat to Palestine from Soviet Jewish immigration, Bush and Secretary of State James Baker worked for a text that the United States could vote for instead of planning the usual American veto. The administration has also signaled support for a U.N. inspection team to visit the explosive West Bank and Gaza strip areas. It carefully avoided a public fight with the Palestine Liberation Organization's Yasser Arafat over allowing him to visit U.N. headquarters in New York.

More chilling to Israel is a White House decision to put a hold on $400 million voted by Congress for housing loan guarantees for Soviet Jewish immigrants. The hold will last until a new Israeli government gives assurances that the Soviet immigrants will not live in the West Bank or Arab East Jerusalem.

Kinder, gentler George Bush is not playing hardball because he likes it. Mubarak warned him over the telephone that if the peace process remains stalled, much more violence is predictable by the Palestinians, who have been transformed into an underclass.

Mubarak's point: Palestinians have endured without armed revolt for nearly a quarter century behind barbed wire in refugee camps or outside in the shadow of enlarging Jewish settlements, usually in extreme economic hardship. ''Jewish settlers in the Gaza strip ... consume seven times the amount of water per capita as Palestinians do,'' Dr. Sarah Roy of the Massachusetts Institute of Technology's Center for International Studies testified two weeks ago to a House Foreign Affairs subcommittee.

The House panel, in a rare discussion of life inside Arab Palestine, heard a second witness, Michael Posner of the Lawyers' Committee for Human Rights, testify that ''for the last 12 months the entire population of the Gaza Strip, 700,000 people, has been under a dawn-to-dusk curfew.'' He attacked a system under which ''secret evidence, never disclosed to the detainee, is the basis for six-month and even now one-year detention'' in Israeli prisons without proper legal recourse.

Capitol Hill, a pro-Israeli fortress, is also moving with administration support to persuade Israel to open up the six Palestinian universities it approved after its 1967 seizure of the West Bank and Gaza. They have been closed for two years.

Last year, conservative Republican Rep. Howard Nielson (Utah) tried to get the House Foreign Affairs Committee to consider his non-binding resolution asking Israel to re-open closed secondary schools, but the committee, packed with friends of Israel, refused. He brought the resolution up as an amendment on the floor. It passed, and the schools were soon opened.

But this year, a similar non-binding resolution by Nielson, this time on universities, will be taken up in the committee. Nielson sees this change as showing slightly less tolerance by Congress for Israel's foot-dragging on peace, possibly because of the $3 billion-plus annual aid U.S. taxpayers give Israel despite budget cutbacks ordered in many other areas.

Senate Republican Leader Bob Dole and several colleagues are pushing a university-opening resolution in the Senate. That fits Bush's strategy: applying small-bore pressure on Israel from all directions to prevent the Middle East from blowing up.