THE THRESHOLD QUESTION in the latest Meese episode -- the Iraqi pipeline affair -- is this: Why had E. Bob Wallach, the attorney general's college classmate, longtime friend and sometime attorney, turned to him in this improbable case in the first place? Or to sharpen it a little, why did Mr. Meese think Mr. Wallach had turned to him? Surely it wasn't for reasons of germaneness or some area of expertise. The pipeline project involved Mideast oil, Iraqi-Israeli relations, internal Israeli politics, a Swiss entrepreneur and various aspects of U.S. foreign policy. Those aren't Mr. Meese's subjects. His friend was asking him to involve himself in these areas of the utmost seriousness -- for the friend's benefit. That is the backdrop against which the actions of the nation's highest law enforcement officer must be judged.

Much attention has been paid to whether one of the documents released, a memo from Mr. Wallach to Mr. Meese, mentioned a possible illegal payment, and whether Mr. Meese properly reacted to it. Mr. Wallach does refer to an "arrangement" that "Israel will receive somewhere between $65-$70 million a year for ten years out of the conclusion of the project." And he also says that "a portion of these funds will go directly to Labor," the Israeli political party. But even conceding that Mr. Meese read this memo carefully and focused on its implications -- he says he did not -- much more evidence is needed before a crime could be charged. Presumably, the payment was to have been made by Mr. Wallach's principal, the Swiss businessman Bruce Rappaport. It is unlikely that he could have violated the Foreign Corrupt Practices Act, since it applies to domestic corporations and their agents. If the money had been misappropriated at the Israeli end -- and there is no evidence that any money was paid -- it would have been a matter for Israeli courts.

Nor, as far as we know, was there a violation of any internal ethics code. Mr. Meese made no decisions about the pipeline himself. He referred his friend to Robert McFarlane, who was then national security adviser, wrote a polite note to Shimon Peres urging him not to approach Secretary of State George Shultz, who had recused himself, and kept the relevant papers on file. No evidence has been offered that the attorney general stood to gain personally from the pipeline or even that the plan to build it was a bad idea.

Nevertheless, it is dismaying once again to note the attorney general's spectacular lack of sensitivity to the appearance of his own conduct. Whether or not evidence of a crime or ethics violation is produced here, it is clear that Mr. Meese continues to be oblivious to the implications, for himself and for the administration, of his involvement in government policy-making that benefits his friends. Mr. Wallach stood to make a lot of money on the deal, and he attempted to trade on his friendship with the attorney general to involve the American government in it. Yet after all the accusations Mr. Meese has faced, all the questions that have been raised about his ethics, his finances and his favors for friends, he did not have the good sense or the willpower to sidestep this influence peddler. He should have told Mr. Wallach to get lost. Mr. Meese still seems unable to see the distinction between public and private business.