THE DUGAN affair needs to be read as punctuation of President Bush's television broadcast to the Iraqi people. Together these developments suggest that the administration is determined to hold to a principled policy of resistance to aggression and that it is struggling against Saddam Hussein's intransigeance and militancy to keep the crisis from exploding into war.

The broadcast on Sunday marked the first time President Saddam Hussein had let Mr. Bush go over his head and address his people directly. The president took the occasion to warn Iraqis that their leader had left them "on the brink of war . . . isolated and alone." He asserted, nonetheless, that it is ''still possible to bring this crisis to a peaceful end" -- if Saddam Hussein will withdraw from Kuwait, restore its rightful government and release hostages. This minimal listing of American objectives -- undoing Saddam Hussein and dismantling his arsenal are not on this list -- fits Mr. Bush's continuing effort to respect the limits that ensure him maximal domestic and international support.

The simplest way to summarize the Dugan affair is to say that the president, through his secretary of defense, yesterday promptly and publicly fired Air Force Chief of Staff Gen. Michael Dugan, who had told several newspapers, including this one, that he was planning to go after Saddam Hussein and bomb downtown Baghdad. The action was no less courageous for being essential to demonstrate that Mr. Bush is in strict control of his government and that he is intent on pursuing what he called yesterday "an all-out full-court international press {on Iraq} on the diplomatic side." Gen. Dugan's gross threats had left an impression of an administration champing at the bit to go to war. In sacking him, the president reaffirms his policy of preparing a viable military option and using it for deterrence while economic and diplomatic pressures are given time to bite.

Much is said of the value of offering Saddam Hussein a face-saving way out of the crisis he has created. His return to the principles affirmed by the United Nations would spare his country great further suffering and loss and, by U.N. resolution, would bring on new negotiations with his neighbors over the grievances (border, oil, etc.) that he cited in invading Kuwait. Mr. Bush is offering President Hussein a chance to save not only his face but his country and perhaps his leadership as well. If war comes, the responsibility for it will be entirely on Saddam Hussein.