The headlines in Israeli newspapers speak to the overwhelmingly positive reaction to President George W. Bush's speech Monday calling for "new leadership" for the Palestinians.

Ha'aretz bannered, "Bush calls for end to the Arafat era," while another header read simply, "Sharon's victory." But, while journalism may be the first draft of history, Israelis are learning that subsequent drafts may tell a different story.

Israel has scored a diplomatic triumph. But, if demographics are destiny, the Palestinians could yet gain victory.

Of course, not everyone is happy. "Annan stands firm at Arafat's side," was the headline in Wednesday's Jerusalem Post. But the opinion of UN Secretary General Kofi Annan matters much less than the judgment of the countries in the region. For their part, Egypt and Jordan issued statements mildly supportive of Bush, while most other Arab states withheld comment, or at least withheld outright criticism. Maybe Arab countries are tired of worrying about the Palestinian issue; it is, after all, a sideshow to their own more immediate domestic concerns.

But what about Arab public opinion, supposedly inflamed by Al-Jazeera TV and other Arab-language news outlets showing West Bank-Gaza violence, seemingly 24/7? History proves that Arab governments, none of which are democracies, can be far tougher than the Israelis in suppressing popular dissent. When the relatively moderate Jordan, for example, felt threatened by Yasser Arafat & Co. in 1970, the Jordanian army crushed the Palestinians in what is remembered as "Black September."

Since every Arab regime faces some degree of threat from terror and insurgency, it could be that Arab officials' stated sympathy for the Palestinians is exceeded by their unstated empathy for themselves. That is, they reckon that if terrorists get out of hand, they could lose their own power positions. That could explain why Muslim regimes, from Morocco to Yemen, are cooperating with American anti-terror efforts. Even Syria claims to be helping.

So Israelis might consider an optimistic scenario for the near term, in which the Arafat era does, in fact, come to an end. The man is 72 years old. Simultaneously, the Palestinians become more prosperous and pacific.

In his speech, Bush promised a major campaign of "economic reform and development," while Israel will most likely find a way to reduce terror within its territory. The Israelis, after all, have always been leaders in counter-terror. They haven't suffered a plane hijacking, for example, since the 1970s. With enough fences, scanners and tough tactics -- imagine a super-Rudy Giuliani -- Israelis might well find effective measures. Such policing will no doubt cause global public-relations problems, but the Palestinians may have suicide-bombed away their sympathy quotient.

OK, but what happens then? No matter how successful the Israelis might be at tamping down the Palestinian problem in the short run, the long run poses another challenge. That is, what to do with about 2.3 million Palestinians in the West Bank and Gaza, plus another million or so Arabs who hold Israeli citizenship -- and their children and grandchildren? For years now, Israeli demographers have worried that the number of non-Jews within the Jewish state was creeping up on the number of Jews -- currently 5 million- and so Arabs would some day overcome, by dint of demography. Bush himself alluded to this concern on Monday, saying that permanent occupation by Israel "threatens Israel's identity and democracy."

Leading Israelis make dire projections. A headline in the June 14 Financial Times was stark: "Israel faces 'demographic time bomb.' " Maj. Gen. Uzi Dayan, chairman of the National Security Council, testified to the Knesset that the total population of Israel, the West Bank and Gaza would total 15 million by 2020, of whom only 45 percent would be Jews.

Could Israel manage its own security if every other Israeli were an Arab? Eventually, as Bush said, Israel will want to support "a viable, credible Palestinian state." Not because it likes the Palestinians, but because it will have to find a place to put them.