HERE GOES the Treasury Department into the automobile business. The department is now convinced that Chrysler will go bankrupt by the end of the year if it doesn't get a massive transfusion of credit. Secretary G. William Miller cites the adverse impact on employment and the economy of the Midwest. Although he didn't mention it, there would also be an adverse impact on the Carter reelection campaign. The solution that he now recommends to Congress is loan guarantees, in very large amounts.

Last summer, when Chrysler originally asked for guarantees of $1.2 billion in loans, Mr. Miller pooh-poohed the figure as impossibly and unrealistically high. Chrysler then came back with a proposal for $750 million in guarantees, but warned that it involved selling some of the company's profitable operations. Meanwhile, the Treasury had accountants at work on Chrysler's books, and the message they sent back to Washington was evidently ominous. Now Mr. Miller has been converted to the view that $1.5 billion in guarantees is a reasonable and proper figure -- indeed, the very minimum.

Unfortunately, this rescue is being undertaken in an atmosphere of emergency that overrides the enormous questions of policy implicit here. Should the federal government prop up weak companies? How does the government best ensure a strong automobile industry? How does it respond to the imports? How many automobile companies does the United States need? Mr. Miller thinks that rescuing Chrysler will contribute to strong competition, but where is the evidence?

This venture would take the Treasury deeply into the operations of the company. The administration bill would make the secretary of the Treasury a sort of super-chairman of the board. As a condition of the guarantees, it would give him power even to require Chrysler to "make such management changes" -- that is, fire and hire -- as he might find necessary.

How should he use this power? Much of Chrysler's trouble results from its adamant insistence on competing with two much stronger companies, General Motors and Ford, across a full line of cars and trucks of all sizes. Simply to keep Chrysler running a little longer as the same kind of company, in the same losing race, resolves nothing. A survival strategy will inevitably involve dropping some products, concentrating the company's considerable technical capacities on others and looking for further resources in new partners and owners. The administration has no clear policy for the future of the American automobile industry. Chrysler is now forcing it to invent one.