From this vantage point at the command center for Israeli occupation of the West Bank of the Jordan River, you have to wonder what the sudden hustle and bustle in Washington over Camp David is all about. If it's about nothing more than artificial respiration for the failing "autonomy" talks, that's one thing. Absent an alternative, they're worth keeping alive.

But if the Reagan administration is planning to plunge Carter-style into the business of trying to break the current stalemate over the West Bank's fate, it better (a) hurry, and (b) brace itself for a head-on collision with the Israeli government of Prime Minister Menachem Begin on a fundamental principle.

The principle is central to the whole concept of the first part of the Camp David accords. (The second part has to do with the nearly completed Egyptian-Israeli peace treaty.) The first part says that during the course of a five-year interim period of "full autonomy" for the West Bank and Gaza, "negotiations will take place to determine (their) final status."

The point was to leave the question open. Yet with every passing day, in every sort of open or cover way, the Israeli government is seeing to it that, before any Camp David formula for "autonomy" can be worked out, the issue will be closed.

How? By the simultaneous application of an increasingly heavy iron fist and a new velvet glove. The iron fist is familiar: jailings, town arrest, expulsion, harassment, intimidation, the demolishing of homes, whatever it takes to crush the influence of the Palestine Liberation Organization by silencing or immobilizing its West bank operatives and/or sympathizers.

The velvet glove is on an arm attached last November to the Israeli Defense Forces (IDF) in charge of the occupation. It is called the Civilian Administration, and its avowed purpose is to separate out from the "security" functions of the IDF (the fist) the problems of "civilian needs."

Or so says the civilian administrator, Menahem Milson. He laid out the philosophical argument for the velvet glove in an article, "How to Make Peace With the Palestinians," in the May 1981 issue of Commentary magazine. At the time, he was professor of Arabic literature and chairman of the Institute of Asian and African studies at The Hebrew University.

At headquarters here, Milson takes note before you do that his deputy and his principal aide are army colonels. But that, he insists, is not the point. His mission, as his magazine piece foreshadowed it, is "civilian" -- "to create conditions in which moderate Palestinians can speak out."

And this, he wrote last May, means "freeing the population of the territories from the grip of the PLO." That's the premise from which Milsonism proceeds: the PLO is irredeemably hostile to any peace process. "Our aim is to reduce to as close to zero as possible the effectiveness of the PLO," he said during a two-hour interview.

But that, he is quick to add, is the job of the IDF. While not disowning the rough stuff, his definition of the division of responsibility is, shall we say, disarming: "To me you can talk about rebuilding houses; for the demolition of the houses, you have to talk to somebody else."

What Milson is building is an alternative to the established municipal and village governing bodies in those West Bank towns and rural areas where the officeholders are either avowedly PLO supporters or suspect.

He is expanding a network of new "village leagues," complete with their own patronage powers (building permits, etc.) conferred upon them by Israeli authorities. As an inducement to "those who are not secure when they want to show their support for the peace process," Milson is selectively issuing firearms -- to "moderates."

Meanwhile, the IDF does its "security" number on "those who attack the peace process," which is to say anybody thought to be allied with the PLO. Prominent figures, including mayors, newspaper editors, lawyers, doctors, are regularly subjected to arrest, detention and calculated harassment. On what evidence? Milson doesn't want to "go into operational secrets."

He sees the targets as "destructive elements," given to "incitement to violence." Both sides are dug in for a protracted struggle. "I am very aware," Milson concedes, "of the very severe limitation on what I can do."

Perhaps so, but the point of immediate interest to Washington is what he is trying to do. To independent West Bank-watchers, when you put it together with a systematic program of land acquisition, it has the unmistakable look of an effort to co-opt Camp David with Israel's own "autonomy" plan -- of a "de facto" annexation which is fast approaching, if it has not already reached, a point of no return.

Milson says "those are not my orders." Perhaps so. But if that is the effect, it fits entirely with the Begin government's policy, openly proclaimed. "We want peace," said Foreign Minister Yitzhak Shamir just the other day, "but only under conditions that will enable us to continue to exist, and that means Judea and Samaria within the boundaries of erts yisrael."

Translated, that means the West Bank territory is not negotiable.