Theirs is the emblematic Washington fraternity, defined not by school or war, but by bureaucratic entanglement.

Lawyers, executives, government officials, consultants and policy analysts have for more than 15 years gathered regularly in meeting rooms around the capital. They have swapped jobs and clients like baseball cards. They have married each other and had children. They have attended funerals.

Tomorrow morning, in the ceremonial courtroom of the U.S. District Courthouse on Constitution Avenue, they will meet again. And they will continue the debate that has bound them for so long:

What should be done about the U.S. telephone industry?

After so many years, the answer has become no clearer.

"We are in a great, ill-defined, foggy, murky area in which the industry and goverment are kind of moving toward a way out of the mess they've created, with no one knowing precisely how it's going to end up and everyone trying to maximize their benefits," said Rep. Al Swift (D-Wash.), who has debated the telephone issues since he came to Congress in 1978.

Clouded they may be, but the hearings set to begin tomorrow before Judge Harold H. Greene mark a critically important turning point in Washington's long debate over telephone policy.

For the first time since the breakup of AT&T was implemented, Greene is being asked to decide the basic structure of the country's telecommunications industry.

(Because he oversees the consent decree that defines the rules of AT&T's breakup, Greene has played a major role in telecommunications policymaking since 1982.)

Specifically at issue during this week's hearings will be some restrictions imposed on the nation's seven regional telephone companies at the time of the breakup. The regional companies, such as Bell Atlantic, provide local phone service through subsidiaries, such as the C&P companies that serve the Washington area.

At the time of the breakup, the regionals were essentially limited to providing what the phone industry once called POTS, or "plain old telephone service."

The regionals are barred from providing long-distance service, manufacturing telephone equipment, selling so-called "information services" such as electronic bulletin boards, or from expanding into new businesses without prior court approval.

Now the regional companies -- and, unexpectedly, the Justice Department -- are asking Greene to lift nearly all of these restrictions.

At stake, people involved in the debate agree, is the fundamental definition of a local telephone utility. For a century, the local Bell System companies around the country emphasized cheap, universal telephone service. Now the regional companies argue that such a narrow mandate is not enough. Customers, they say, demand -- and deserve -- the benefits of competition and new technology.

The regionals and their backers argue that if Greene will free them from the current restrictions, residential telephone users will be introduced quickly to a dazzling array of new, high-technology services: a phone network feature that substitutes for answering machines; new electronic mail services, and perhaps even a video terminal system comparable to the French Teletel network, which provides customers with electronic directories that substitute for the Yellow Pages.

"It doesn't make sense to keep those kinds of services away from the American public when they are going to be appearing all over the world," said Ron Stowe, a Pacific Telesis vice president who heads the regional phone company's Washington office. "The network right now is capable of providing them."

"We see the French system, which was certainly a laughingstock of telecommunications 10 years ago, being held up as a model. And it's basically because they have unshackled the network," complained Raymond W. Smith, vice chairman of Bell Atlantic. "We are in a period of redefinition with or without the court."

Not everyone is enamored of the regional companies' alluring promsies, however. "I think it's quite speculative at this point as to how much demand there will be for these services and whether it can be done without simultaneously driving up the price of basic voice service," said Gene Kimmelman, legislative director of the Consumer Federation of America, which opposes any proposal to lift the restrictions on the regional companies.

"I think the American public is still very suspicious of what happened {with the AT&T breakup} in the first place and would prefer to let things stabilize, rather than go through a second revolution in our telephone system in five years," Kimmelman added. "It's just too much."

Kimmelman and his intellectual allies are denounced by the regional companies as modern Luddites, reactionaries in the face of inevitable technological advance. But such criticism by the regionals is unlikely to impress Greene, who has long questioned whether the local telephone companies can vigorously compete in new businesses without violating the antitrust laws.

Even some of the regional companies concede that if they get everything they are asking for from Greene, they will have created for themselves the exact same business structure -- with all of the same potential antitrust problems -- that led the Justice Department to sue and eventually dismantle AT&T during the 1970s and 1980s.

But with bravado reminiscent of that displayed by AT&T 10 years ago, the regionals declare that they are willing to take their chances with the law.

"If you are worried about my antitrust liability in the future, let me worry about it," said William L. Weiss, chairman and chief executive of Ameritech, the Midwest regional.

"If I'm found guilty, I'll pay the piper," he said. "But we ought to take that risk. And the customer will be better off if I take that risk."

In the present political climate, of course, the antitrust risk is diminished. The same Justice Department that insisted five years ago that AT&T's structural antitrust problems could only be solved by breaking the company apart now makes the opposite argument, saying the regionals deserve to be unshackled because there is no real potential for anticompetitive abuse.

Justice's turnabout, made at the department's highest policymaking levels, has left many of its own staff lawyers bitter and cynical.

They point out that the Antitrust Division's own economists opposed the policy switch, as did staffers at the White House's Council of Economic Advisers.

The issue is whether the regional companies' monopoly in local telephone service would give them an unfair advantage while competing with telephone equipment makers and providers of new information services.

It was precisely AT&T's control of that local telephone "bottleneck" that caused MCI Communications Corp., U.S. Sprint, and Justice to file massive antitrust suits against the telephone giant during the 1970s.

While supporting the regionals, Justice argues that two things have changed since then: competition has increased in nearly all sectors of the telecommunications industry, and the Federal Communications Commission has developed new, more effective procedures to prevent abuses.

But a number of Justice lawyers contend privately that the policy turnabout is not justified by the available data. "It's very hard to point to anything that's changed," one lawyer said.

This staffer said that what really has changed since the breakup is the level of political sophistication at the regional companies. "I've been amazed over the last few years to watch them learn how Washington works and get access," this lawyer added.

The irony of Justice's switch to support the regionals is not lost on AT&T, which adamantly opposes lifting the restrictions on its offspring. AT&T argues that Justice and the regional companies have contradicted promises made at the time of the breakup.

So concerned is AT&T that it has joined an unlikely alliance with its nemeses in the long-distance market, MCI and U.S. Sprint, in an attempt to defeat the regionals' request.

"What they're trying to do is get an exemption to the antitrust laws," argued John Hoffman, a Sprint senior vice president in charge of regulatory affairs. "The Bell companies are totally ignoring all of the legal principles that were so painfully established during the divestiture. . . . They're trying to climb over it with these purported public interest arguments" about new technologies and information services.

Balancing the "purported public interest" with rational enforcement of the antitrust laws has been Greene's burden since he took charge of the AT&T case nearly a decade ago. It seems clear that he is now concerned that rigid antitrust enforcement may deprive the American public of innovative services that would otherwise be available soon.

In an order issued in preparation for this week's hearings, Greene singled out eight questions that he hoped would be addressed by advocates for the plethora of special interests now before his court.

The questions cover the full range of issues before him, but Greene singled out information services for special attention. He asked the regional companies to tell him whether duplication of the French Teletel system was feasible in the United States. And he suggested that all the parties make arguments about what the court should do "if it appears that entry of the regional companies into a particular market could impede competition but that such entry would yield substantial other benefits to the public."

The most frequently cited example of this dilemma is the regionals' proposed introduction of voice storage "mailboxes" in the local telephone network -- a relatively low-cost system that the regionals claim would work as an electronic answering machine activated through touch-tone telephones. Though they say it is ready to go, the regionals cannot introduce this service under the present restrictions. If permitted, the regionals would compete with answering machine manufacturers -- mainly Japanese -- and small answering services.

Critics say the regional companies cannot be trusted to give equal access to U.S. competitors who want to provide the same electronic service through the local phone network. But the regionals argue that the prohibitions only cripple the existing network while exacerbating the industry's trade deficit with Japan.

"We're protecting anachronisms of the past," said Weiss, Ameritech's chief executive, referring to the answering services that would no doubt be forced out of business if the new electronic technology was widely introduced. "That's a very harsh kind of judgment . . . {but} is that the way this industry ought to unfold, by protecting all these little agencies?"

Many of those involved in the debate say that policy issues such as those surrounding the introduction of electronic answering services are precisely the kind that should be decided by Congress. But legislators in the House and Senate have been paralyzed for more than a decade by the industry's competing special interests -- not a single piece of significant policy legislation has been passed, despite repeated efforts.

So the issues again fall to Greene, who has been criticized for lording power over the telephone industry.

In deciding whether to lift the restrictions on the regional companies, Greene in effect must choose whether to perpetuate his own central role in telephone policymaking. If he lifts the restrictions, his influence will diminish; if he retains them, he will remain at the industry's center.

Lawyers and analysts on all sides of the debate have spent much time speculating about where Greene will come out. (His final decision is not expected before the fall.) Such psychological analysis of the judge has been a preoccupation among telephone insiders for years.

A growing number of those involved think that competitive pressures and rapid technological change will eventually undermine the judge's influence.

Certainly, that is the hope at many of the regional companies.

But those who have debated the issues in Washington for years say that there is something familiar about the hearings on Constitution Avenue this week.

"Judge Greene may want to cast this issue as the future evolution of the telephone network," said Chip Shooshan, a telephone policy consultant who was formerly a staffer at the House telecommunications subcommittee. "But I think what we have here is a classic example of traditional, economic self-interest being fought out in the arena of a U.S. District courtroom."