Revolution or holding operation? Terrorism Inc. or 19th century nationalist movement? Such are the questions that surround a major force in contemporary world politics, the Palestine Liberation Organization.

Prized by Palestinians long deprived of any credible symbol of national identity, hated and feared by Israel -- and some Arab regimes that find it politically expedient to publicize their support -- the PLO is an unequal combination of all these ingredients, of Mideast Mafia and state in gestation.

If any meaningful common denominator exists, it is Yasser Arafat and the commanding grip on the overall Palestinian resistance that he has consolidated over the years. That power is exercised through his unquestioned control of Fatah, the oldest and by far the largest and most influential of the half dozen Palestinian political-military organizations grouped under the umbrella of the PLO.

Fatah has no clear-cut ideology, unlike Palestinian leftist organizations such as the Popular Front for the Liberation of Palestine, and defines itself merely as "a national liberation movement struggling against imperialism and Zionism." This vagueness allows a variety of factions, often opposing, to coexist within the group.

"Any Palestinian who isn't branded [otherwise] is Fatah," remarked an admiring Palestinian who for his own reasons has chosen to remain outside.

"Any Palestinian who wants to have a homeland is welcome. Ideologically, Fatah is a wide superhighway with few stop signs."

Arafat has exploited the discredit of the old aristocratic Palestinian diaspora that came with it.

More than 3 million Arabs of Palestinian origin now live in the Israeli-occupied West Bank and Gaza, Jordan, Lebanon, Syria, the Persian Gulf countries and in scattered groups elsewhere throughout the world. Little more than 600,000 live within Israel's pre-1967 borders.

Roughly half of the population living outside Israel are still considered refugees and about 20 percent continue to live in camps.

Arafat also capitalized on the discredit of the Arab states in the wake of their humiliating defeat in the 1967 Six-Day War and by February 1969 Fatah had gained control of the PLO and ended the domination of the Arab governments that originally set it up in 1964.

As PLO chief, he has perfected the politics of movement and survival.

The formal pan-Arab endorsement in 1974 of the PLO as sole legitimate representative of the Palestinian people has not made Arafat forget that many an Arab politician still dreams of bringing the movement to heel.

A favorite, bitter saying of the Palestinians is that they have lost more men fighting fellow Arabs than they have against the Israeli enemy.

Although Arafat and his friends in Fatah have been in undisputed control for more than a decade, they still provide something new in Palestinian -- and indeed Arab -- politics.

Mostly lower middle-class men, they stand apart from other Arab world leaders. They are not hereditary rulers, members of a geographic, clan or religious minority or comrades from the same class of a military academy.

That is closer than most Arab states have come to a rational, modern political system.

The men of the Fatah leadership have grown suspicious of ideology and increasingly conservative as they seek to justify the often radical irredentism of the exiles with the moderate motivations of Palestinians in the Israeli-occupied Gaza Strip and West Bank.

In the process Arafat and his team have come to value loyalty more than efficiency. It is a decision said to have historic roots in the revulsion against internecine fighting among Palestinians in the 1920s and 1930s.

But it is nonetheless surprisingly indulgent in the light of the constant invocation of the ruthless discipline, dedication and success of the Zionist foe as a model.

The PLO's reluctance to use fully what is generally considered the Arab world's best motivated, most highly educated and successful elites remains a major failing.

It is a failing that Arafat has turned to his own uses, just as -- despite his paunch, balding head, stubbly face and lisping, Egyptian accent -- he has become an improbably hero, the uncrowned king of the Palestinians.

He has developed a genius for persauding Palestinians that military defeats are tactical victories. He has honed a policy of tactical alternatives and celebrated movement for movement's sake, skilfully shifting with the changing winds of Arab politics and taking advantage of differences among the various regimes to preserve the relatively autonomous position of the PLO.

Thanks to the industrialized world's dependence on imported oil -- and conservative Arab oil-exporting countries' nervous need to remain on good terms with the PLO -- Arafat has emerged as an increasingly acceptable diplomatic interlocutor.

Palestinian officials now boast they have more diplomatic missions abroad than Israel, which can rely with certainty only on the United States and South Africa.

After the Third World, oil-hungry Western European countries have found it expedient to receive Arafat or edge toward backing his cause. Japan is following suit despite its longstanding policy of seeking to separate business and politics.

Yet, even a cursory visit to the PLO offices near West Beirut's Arab University hardly conveys an impression of such strength.

Only the incurable romantic who equates revolution with unwashed tea glasses, yellowed posters and unemptied ashtrays can avoid an impression of routine, mediocrity, even carelessness.

Apologists argue that the decor of these putative ministries of a future state is as much part of the Palestinian persona as Arafat's stubbly face or the necklace of refugee camps ringing Beirut.

"They are our Dachau, our Auschwitz," a Palestinian woman remarked of the camps. By that she means they symbolized the suffering and legitimacy of a national ideal in much the way the Nazi extermination camps served to dignify and advance the Zionist cause after World War II.

Today they are only some of the Palestinian symbols. For Palestinians are also bankers, engineers, teachers, doctors, members of an ever-growing middle class elite which can bear comparison with the rich variety of the Jewish diaspora itself.

No longer is it exceptional to see the cap-and-gown graduation photograph of a son or daughter proudly displayed in a refugee camp hovel.

Indeed, the new middle class dominates the PLO-affiliated groups. Of the 10 PLO affiliates, only the workers and peasants do not fit the middle class elitist mold of teachers, writers and journalists, doctors, engineers, artists and lawyers.

But old, inherited ways die hard, expecially for an uprooted society desperately clinging to ancestral habits in its exile as a means of maintaining the last shreds of a threatened identity.

Palestianians spend years wandering from camp to camp before finding their friends home and to this day their mukhtars or village head men often exercised their old functions. Old men recount how their lives stopped the day they left Palestine more than 30 years ago.

Adolescents wax lyrical about the orange groves in Jaffa they never saw and which long since have been paved over.

Given such emotional ties to an idealized homeland, Arafat was on solid ground in rejecting reliance on Arab regimes as yet another means of controlling Palestinians grown unruly in their disappointment with unkept promises.

He also correctly judged that the diaspora Palestinians were fed up with their political past and especially with the traditional leadership which quite literally deserted their country in early 1948.

Whatever the virtues of the Husseinis, Nashashibis and the handful of other great landed families entrusted with feudal power and influence since Ottoman Empire days, their stewardship since the 1920s bore the stigma of failure.

Unable to defeat the British mandatory power or Zionism, they were also powerless to prevent internecine violence among Palestinians.

Fleeing both the physical and ideological constraint of President Gamal Abdel Nasser's pan-Arabist Egypt in the last 1950s, Arafat and his principal lieutenants worked out a simple doctrine in politically tolerant Kuwait, which has the seventh largest Palestinian polution after Jordan, the West Bank, Gaza, Isreal, Lebanon and Syria.

Largely of lower middle class stock, they saw the davantages of moving to Jordan and Lebanon where the refugee camps afforded them both protective coloration and strength.

Theirs was a simple slogan -- armed struggle and total liberation of Palestine -- and appealed to Palestinians fed up with Arab verbalism and dependency on Arab governments.

With the collapse of Arab armies in the Six-Day War of 1967, Fatah came into its own. In 1968, against as Israeli reprisal expedition at the Jordanian village of Karameh, Fatah stood and fought, endured fearful casualties and established its Arab world credentials once and for all. The following year, Arafat wrested control of the PLO from Ahmed Shukairi and the Arab regimes.

But armed struggle never amounted to more than a slogan even in its hey-day when Fatah hoped to involve the Arab regimes in war against Israel.

In 1970 an ill-considered Palestinian effort to overthrow King Hussein -- following progressively deteriorating relations with Jordan over the undisciplined Plaestinian political and military presence -- led to the forcible expulsion of the guerrillas from the country and ended their access to the longest Arab border with Israel.

Armed struggle suffered further setbacks after 1975 when the Palestinians allowed themselves to get sucked into the Lebanese war and even more so after 1978 when Israel seized on a guerrilla raid to occupy a border strip in south Lebanon that it later handed over to its Christian Lebanese surrogates.

Over the years, Arafat has scaled down his political demands. No longer does he demand even a democractic, secular state.

Rather he is on record as saying he is willing to plant the PLO flag in the West Bank town of Jericho if that is all that can be obtained, a further step back from one of his lieutenant's claims that the PLO would settle for "22 percent" of the former Palestine mandate territory.

Such realism is not just tactical. Palestinians privately admit they have failed to mount effective military operations inside the Israeli-occupied territories.

No important Israeli leader has ever been assassinated. No guerrilla raid has ever attacked, say, the Israeli nuclear weapons center at Dimona.

But the symbolism of the gun and the rhetoric of armed struggle remain popular, no matter how far removed from reality.

Nowhere is this more evident than in the refugee camps and among the 25,000 armed men and countless bureaucrats who draw regular PLO salaries. Arafat keeps a close eye on the financial operations of the PLO, which operates on contributions from oil-rich Arab countries, as well as some funds levied from Palestinian camps and bourgeois populations. The Palestinians also receive U.N. food and educational aid.

The PLO bureaucrates are no differenct from any others. Any change in the status quo is threatening, especially the possibility that they would be jobless if statehood were achieved.