THERE IS an edge of smallness to the administration's decision to withhold further economic aid from Nicaragua. The last $15 million of a $75 million package had been suspended -- properly -- by way of forcing Nicaragua to halt the flow of (Cuban-supplied) arms to insurgents in nearby El Salvador. So effectively have the Nicaraguans complied that, in a setting where American intelligence has measured the past flow of arms practically to the bullet, the State Department now concedes there is "no hard evidence of arms movements through Nicaragua during the past few weeks." Yet that last $15 million is being cut off.

The State Department manifests a curious ambivalence. It defends the cutoff, feebly. To its original demand that Nicaragua stop sending arms on to El Salvador, it now sheepishly adds the complaint that Nicaragua halt unspecified "political and logistical" support as well. At the same time, the State Department suggests that the cutoff isn't really that serious or final after all. The department is waiving its right to insist that Nicaragua pay back past loans, and it suggests that the Food for Peace program could be resumed in Nicaragua within two or three weeks.

Do not look for logic. Look for pacification -- of Sen. Jesse Helms (R-N.C.). It is unfortunate for a particular reason. The final returns in El Salvador are far from being in, but some of the early Reagan-period returns are, and they show that the administration is moving toward a certain provisional success in 1) isolating the insurgents from any extensive fresh arms, 2) breaking the local myth of guerrilla invincibility and 3) putting the anti-government forces on the defensive. You may say that some of this was happening anyway -- the guerrillas' "final offensive" failed on Jimmy Carter's watch -- and that a reelected Carter might have followed the same policy. You may also say that the government of El Salvador is still painfully far from bringing either tranquility or justice to the people of El Salvador. But things are working for Ronald Reagan in El Salvador now about as well as a reasonable person could expect.

Why spoil it with a show of meanness and erraticism on Nicaragua? Why provoke the hard-liners there and discomfit the middle-class moderate types who, for selfish reasons that happen to be in the American interest, want close ties with this country? Why rekindle the anxieties that were current and worldwide just a month ago that the Reagan administration had gone wild and was overplaying its hand in El Salvador? It is a question of touch, of proportion. If a bone must be thrown to Jesse Helms -- and why? -- find another one. El Salvador is one bit of turf it would be a pleasure to see the secretary of state fight for.