IT TURNS OUT that Yasser Arafat, head of the PLO, was reading his press clippings rather than keeping in touch with the rank and file. He is under challenge from within the main PLO component, the "centrist" faction known as his turf, Fatah. Whether he survives or, if he does, whether his command will be anything close to what it was, apparently is a question.

As is usual when there is blood in the water, many personal and organizational failings are being attributed to Mr. Arafat. But it is not difficult to see wherein the trouble lies. The PLO was supposed to bring Palestinians a homeland, but the Palestinians have not been further away from a homeland since the PLO was formed almost 20 years ago. The ouster of PLO forces from Beirut last summer merely brought home to many PLO fighters a disastrous condition that was already widely evident. The surprise is that the disaster could have been covered up as long as it was.

The PLO rebels are said to feel that the "moderate" Arafat brand of leadership has been discredited. A fundamental misreading is involved here. Mr. Arafat was a moderate only in the sense that he dabbled with a political solution, while others believed strictly in armed struggle. But Mr. Arafat only dabbled. He never made the unequivocal commitment to peaceful coexistence with Israel that alone would have made possible the requisite negotiation. He feared, apologists repeatedly said, that accepting Israel before (or even after) Israel accepted a Palestinian state might "split the movement." His equivocation brought the PLO the worst of both worlds. It has never tested the political route and it has been reduced to little more than a nuisance military force.

If Mr. Arafat is forced to harden his line to retain power, or if he is replaced by someone more militant, then it can be confidently predicted that the PLO will continue to cause a lot of misery, mostly to Palestinians, and that it will move the Palestinians even further away from a homeland.

At this point, the so-called friends of the Palestinians usually start complaining about how unfair it is to ask the Palestinians to sit down with the Israelis, how difficult, etc. How ridiculous. The Palestinians should start asking who their real friends are. They could have had a state from the United Nations in 1947, with Israeli consent, but their then-leadership and their Arab brothers rejected it for them. It is past time for some representative group of Palestinians to take their people's fate out of the hands of Israelis and fellow Arabs, who toy with it, and to challenge Israel to negotiate peace.