JERUSALEM, July 29 (JTA) Israeli politicians are divided over whether a cease-fire proposal that the Palestinians reportedly were about to present last week was genuine. The July 23 assassination of Hamas´ military leader, a bombing that also killed 14 civilians, temporarily shelved the plan. The impetus behind the proposal remains the same, however, raising the likelihood that with some prodding from the international community the Palestinians indeed may soon put a plan on the table. According to reports, despite the killing of Hamas military leader Salah Shehada, talks are still under way among various Palestinian factions to work out such a plan. Some Israeli officials believe it would show that Israeli steadfastness against the intifada has pushed the Palestinians to the breaking point. That would present Israeli leaders with a difficult dilemma: Should they keep up military pressure to finally crush the intifada? Or should they respond to a cease-fire plan, even one about which they have reservations, with concessions of their own? Israeli officials continue to regard with skepticism reports of Palestinian readiness for a cease-fire. What is needed, they say, is not a truce that leaves Hamas, Tanzim and other terrorist groups and militias intact to fight another day, but reform of Palestinian institutions to concentrate all military power in one body and dismantle any competing power centers. Yet especially after the July 23 raid in Gaza City, which killed Shehada and at least 14 civilians, Israeli leaders might find their freedom of action circumscribed. Coming just as reports were emerging of an imminent Palestinian cease-fire plan, the Gaza attack opened Israeli Prime Minister Ariel Sharon to charges that he was torpedoing progress toward peace and might make it more difficult for his government to dismiss a new Palestinian plan that bears the imprimatur of European negotiators. In Israel, the different views of the Palestinian plan that was emerging derive, at least partly, from different analyses of the Palestinians’ motives. According to one account, there has been a major change in Palestinian thinking. Young members of the Tanzim, the militia of Palestinian Authority President Yasser Arafat’s Fatah movement, recognize that the intifada is getting them nowhere and want a cease-fire to build a new relationship with Israel and the United States. The economic hardship caused by Israel’s reoccupation of Palestinian cities a month ago has made this need even more urgent. A cease-fire might encourage release of Palestinian tax money Israel is holding after the Gaza debacle, Sharon began releasing some of the money and additional aid from the United States and other quarters to help rebuild life in the Palestinian territories. Left-wing politicians, like the Labor Party’s Haim Ramon, the new chairman of the Knesset’s Foreign Affairs and Defense Committee, say that if this is the thinking behind the cease-fire drive, it constitutes the beginning of a strategic change and is of vital importance. Tanzim leader Marwan Barghouti, who is in an Israeli jail awaiting trial, is said to think this way. Others offer more tactical explanations for the cease-fire effort. According to a rival theory, Tanzim activists feel threatened by the moves to reform Palestinian military and political institutions. The activists fear they might be sidelined as Arafat’s cronies control the reform process and use it to shore up the old guard’s strength. The stature of the Tanzim fighters has grown immensely in Palestinian society during nearly two years of warfare with Israel. Yet they realize that their power has no political outlet, and what they are trying to do through the cease-fire bid, according to this theory, is to place their movement at the center of the Palestinian political map, dictating a timetable and an agenda and stealing the initiative from Arafat and Hamas. According to this theory, the Tanzim activists want a cease-fire to create a climate for elections. Their plan is to push first for internal Fatah elections, in which they can take control of the movement’s institutions and establish a power base for municipal and national elections that would follow. The cease-fire bid, then, is part of an internal Palestinian power struggle, a tactical move that might not change attitudes toward Israel, even if the young Tanzim activists win a greater measure of power. As for Hamas, the theory goes, they want a cease-fire to pre-empt attempts to disband their military wing as part of the reform of the Palestinian armed services. Israel insists on one unified Palestinian force, which would mean the disbanding of all rival militias, including Hamas. During the past few weeks, European representatives on the ground saw which way the wind was blowing, and tried to give the cease-fire idea direction and substance. The main player was Alistair Crooke, a British intelligence officer who has been active in the Palestinian areas during the 22-month-long intifada. Crooke also met with the Israeli defense establishment and politicians and informed Israeli intelligence of the cease-fire plan 36 hours before Shehada’s assassination. The idea was for the Tanzim to publish a unilateral cease-fire declaration in various Western newspapers, in the Arabic press and in a Hebrew daily. Mark Perry, an American lobbyist for the Palestinians, helped draft the English text. As the initiative gained momentum, Mohammad Dahlan, the former head of Palestinian security in the Gaza Strip and one of Arafat’s potential successors, was brought in. Arafat’s top aides were left out. Hamas leaders were approached and, according to reports, at least some indicated that they would be ready to go along. However, according to Israeli intelligence, Arafat found out what was going on and made it clear that he had no interest in a cease-fire at this juncture. The activists on the ground got the message, and Israeli defense and intelligence officials insist that the terrorist rank-and-file would not have respected the cease-fire that the political leaders had negotiated in their names. Writing in the Israeli daily Ma’ariv, political commentator Ben Caspit reflected the Israeli quandary: “Those who believe the Palestinians are simply trying to gain time on the way to more terror don’t buy all this stuff,” he wrote. “But those who think every chance should be given for the creation of a new leadership that springs up from below regret yet another missed opportunity, and anticipate rivers of blood that will wash its way into the sea.” At Monday’s meeting of the Knesset’s Foreign Affairs and Defense Committee, Ramon produced a version of the Palestinian cease-fire document and asked Defense Minister Benjamin Ben-Eliezer whether he had known about it before Shehada was killed. Ben-Eliezer said he had, but played down its significance. He described it as an initiative by the leaders of the organizations and not the grassroots terrorists, who he said would have ignored it. And, Ben-Eliezer added, so would Shehada himself, who at the time of his assassination was planning acts of mega-terror, including a one-ton truck bomb, and simultaneous bombings in six different Israeli cities. Ben-Eliezer made the official Israeli position clear: A genuine cease-fire would be welcomed, but not at the expense of reform of the Palestinian security services. He is convinced that the most effective guarantee of long-term peace and quiet is a single armed Palestinian force, in total control of Palestinian territory, and cooperating with the Israel Defense Force on security matters. Ben-Eliezer intends to discuss his plan for implementing this model in “Gaza first” with the new P.A. security chief, Gen. Abdel Razak Yiheyeh, as soon as possible. But the bottom line hasn’t changed. Israel continues to insist on two conditions before peace talks with the Palestinians can be resumed: Arafat must go, and there must be thorough reform of the Palestinian security forces. A cease-fire in itself, no matter how well-intentioned, will not be enough.