DELAYED ONLY briefly by the death of three of their company, American diplomats are back at work on an initiative that carries serious promise for a political settlement, though not for a full peace, in the Balkan wars. The chief obstacle, the parties' profound mistrust and ethnic blindness, remains in place. But some of the tactical circumstances have changed enough to permit a certain cautious hope.

The cruelest but most decisive factor enabling a settlement is that four years of war have left most of Bosnia's Serbs, Croats and Muslims living -- hundreds of thousands as refugees -- among their own. Further, Croatia's battlefield successes have mooted for now the principal issue -- Krajina -- lying between Serbia and Croatia, though the potentially explosive issue of Serb-held eastern Slavonia, claimed by Croatia, is yet to be defused. Bosnia's Muslims are in a politico-military position to reverse some fraction of their terrible losses. Bosnia's Serbs, continuing their frightful atrocities, are increasingly isolated, and are feuding among themselves.

President Clinton has his own political reasons to finally step into the diplomatic lead and to try to make Bosnia more of a credit or at least less of a debit in 1996. But regardless of the electoral calendar, it would be foolish not to attempt to exploit the opening created by the new circumstances.

American diplomacy seeks to build on the long-stalled five-nation Contact Group plan, which in effect recognizes the war's rending of Bosnia, grants a reduced but still large chunk of it to Serbs and another large chunk to Croats, and leaves a small Muslim-led "Bosnia" in the middle. If Serbs impeded the plan, NATO would lift the arms embargo and mount airstrikes, or so the thinking goes. If Muslims impeded the plan, their residual international support would fade. Serbia proper's cooperation would be rewarded with a lifting of economic sanctions. Mutual recognition would be expected of the Balkan parties, and foreign aid would be liberally applied.

This is not a plan to be proud of or to call something that it is not. It registers acceptance of defeat of the stated presidential purpose -- at least the purpose stated part of the time ever since the presidential campaign. It is what the American government has concluded is the best and the most that can be achieved. And as such it is its own commentary (more no doubt will follow from those who produce commentary of their own) on all the many missed opportunities and ducked challenges in the past.

This plan -- there is no blinking the fact -- accepts the fruits of both unspeakable "ethnic cleansing" and the forcible alteration of international frontiers. All that can be said for it is that it deals realistically with military results that the Balkan losers lack the power and outsiders the will to change and that this moves the Balkans, if not all the way to peace, then at least away from war. There is no satisfaction to be taken in this outcome, but there is nothing on the horizon that improves on it either -- and that seems to us true of the various plans offered by restless legislators on the Hill.