A decision pending in U.S. District Court relative to the city's street vending controversy could have an impact that goes well beyond the immediate issue. Indeed, the matter could wind up before the Supreme Court.

Even though the issue at hand may seem minor in the total framework of commerce in the District, some very important questions will be settled one way or another by the court's decision. And the court's answers to critical questions about competition, free enterprise, discrimination, protectionism, monopolies, the right to work and exclusionary regulations will be more than instructive where local interests are concerned. Indeed, the answers will be watched closely in more than a few communities.

Challenging the District's new street vendor regulations in court may prove ultimately to have been the best course of action for the city's vendors.

On the other hand, the issue never should have reached that stage. Reasonable people in the D.C. government, the city's business establishment and the vendors' association could have resolved the long-standing dispute in a rational and equitable manner. Instead, D.C. officials allowed themselves to be spooked by relentless pressure from the Greater Washington Board of Trade into hatching a crazy-quilt compromise on vendor regulations.

What began as a sensible approach to a possible resolution of the quarrel between the business establishment and street vendors quickly degenerated into an embarrassing bureaucratic bungle by D.C. officials. The irony of it all is that, while vendors have sued to block new regulations governing their activities, some members of the business establishment still don't think the regulations go far enough.

Nonetheless, the new regulations represent a victory for the board of trade. The powerful business organization implied as much in a recent edition of its monthly newspaper. BOT members were reminded that the new regulations will take effect "after many years of effort, countless hearings and the investment of thousands of Board of Trade member volunteer hours."

The city's response to that effort is a ludicrous hodgepodge of vending regulations that prompted the lawsuit pending in U.S. District Court. Vendors maintain the rules are designed to stifle competition for businesses in fixed locations. City officials say the rules were necessary to protect consumers and to improve the appearance of neighborhoods.

The city hopes to accomplish that by insisting that street vendors sell only "ready-to-eat" foods and produce, art objects, printed media, beauty products, novelties, stuffed toys, hand-knit items, pottery, leather goods, woodcrafted objects, sunglasses and umbrellas. The sale of leather goods is permissible on the street, mind you, but only stores may sell T shirts.

The same pretzel logic says street vendors will be permitted to sell their wares only from precisely engineered and uniformly decorated carts.

Taxicab drivers are allowed to rumble through the streets of Washington in rolling death traps not subject to frequent inspections, and the consumer be damned. Consumers who patronize vendors, however, require protection. Setting limits on the kinds of merchandise vendors can sell, restricting their locations and forcing them to use carts made of pressure-treated lumber will bring order to downtown streets and protect consumers. Let the buyer beware of government regulations.

This is a city that winks at the legions of prostitutes who regularly accost passersby. This is a city that gives little more than lip service to keeping the sidewalks clear of drug traffic in certain neighborhoods. But then, doing business on the streets as prostitutes, pimps and drug dealers doesn't raise many concerns about unfair competition. It's business as usual on the city's mean streets, but new regulations are required to "reorder the balance between street vendors and stores."

No one has yet produced irrefutable evidence that 5,200 street vendors pose a serious threat to businesses in fixed locations. The biggest threat to stores in downtown Washington is, and will continue to be, increased competition from a steady influx of retailers who are drawn by statistics that show that the District is part of nation's fifth-largest retail market.

Putting 1,000 street vendors out of business in an irrational purge of the District's work force won't save complacent retailers from stiffer competition by their smarter and more aggressive counterparts. It is certain to raise the unemployment rate, though.

Increasing the license fees for vendors, beefing up the sales-tax-collection machinery, requiring licensed vendors to wear photo-identification badges at all times and establishing a fee for the use of public sidewalk space would have been too simple. City officials not only made a bad situation worse but, in the process, lost sight of its role in guaranteeing equal protection under the law.