IT'S EASTER. The hostages were seized right after Halloween. That's long enough. There is no need now to second-guess the policy by which President Carter has tried to extricate them over the last five months but there is a need to look reality in the face. If things are in fact the way they appear, the administration's policy of alternating sanctions and concessions has failed. The hostages are not free, not even transferred to the ostensible government of Iran. Prospects for their liberty, or transfer, by a continuance of the present policy are dim. The United States, far from earning respect for its restraint and forbearace, is increasingly seen as a country that shrinks from asserting what even its enemies recognize as a legitimate interest in protecting its diplomats from a mob.

The latest sequence of negotiations between Washington and Tehran puts the issue beyond argument. The United States has made concessions of the sort one might expect from a nation that had lost a war. Each concession has been met with a demand for another. The divisions and disputes within Iran that are responsible for the impasse seem almost self-perpetuating. It is a moot point whether Iranians who draw political profit and emotional gratification from the holding of the hostages and from the negotiating over them have any intention of letting them go.

Meanwhile, the condition of the hostages worsens. Suicide attempts, punitive solitary confinenements and continuous harassment and psychological pressuring of some prisoners are reported. Not all of the captives are accounted for. Even under the best circumstances -- "best" is an odd word in this context -- it is said that at least a couple of months will have to pass before there can be a testing of the Iranians' promise to have their as-yet-unelected parliament consider the freeing of the hostages. In those months these prisoners would continue to be subjected to terrible maltreatment.

So enough. A review of policy is unavoidable. Until now the premise has been that a calculated show of flexibility and moderation on the American side would induce a matching response on the other side. But this has not happened. A remarkable and far-reaching set of American concessions, ranging from abstention from force through the suspension of new pressures to the acceptance of an official gag, has not freed the prisoners. The only reasonable conclusion is that this string of diplomacy has been played out. Its limitations have, we believe, been demonstrated and proven to most Americans. In the common international view, too, the United States has been sorely tried: it has acted in a responsible and mature way and for its pains it has received only humiliation and a demand for further humiliation -- still with no assurance that the hostages will be released.

A new approach is required, one arising from the recognition that American moderation, rather than subtly helping the less fanatic players in Tehran, has been commandered by the radicals. American restraint has undercut the argument of those making it in Tehran that it is more in Iran's interest to release the hostages than to hold them. Restraint has served the radicals' claim that it is not only safe but profitable to take advantage of the United States. This argument must be rebutted -- for the sake of the prisoners and for the sake of American interests extending far beyond Iran.

Fresh sanctions are evidently being weighed by the administration. Good. They should be applied. The United States should spare no effort to find new ways, involving foreigners as well as Americans, to raise the cost of Iranian criminality. The additional pressures the administration considers should not be ambiguous, indirect or in slow motion. They should be direct and consequential. Moreover, there should be not half or hesitation in applying these pressures until the captives are released. Iranian defiance has bankrupted the ealier notion or nourishing the efforts of those Iranians trying to work from within to free the prisoners. Those efforts deserve appreciation; their authors' weakness forces the United States to take another course.

For a man of Jimmy Carter's gentle philosophy, nothing could be more personally wrenching than to embark on a policy of escalting open-ended pressure. What Iran's conduct compels him to decide, however, is how else he can effectively assert the American interest in saving the prisoners and this country's self-respect.