Bus and subway workers went on strike early this morning, presenting New York with a promise of massive traffic jams, huge economic losses and thousands of missed paychecks.

The announcement came shortly after 2 a.m., more than two hours after the midnight strike deadline set by the Transport Workers Union. The union and the Metropolitan Transportation Authority had continued negotiating past the deadline, hoping to avert the kind of chaos that followed the union's walkout in 1966.

The strike by the city's 33,600 transit workers could cost the New York economy an estimated $150 million daily, strand 6 million daily riders and cause thousands of medium- and low-wage earners to miss work and lose pay. It might also wreck the striking union.

An increase soon in the 50-cent transit fare is inevitable -- strike or no strike -- because the transit system faces a $250 million deficit before a new labor settlement.

City officials estimate that triple the normal flow of 600,000 cars will enter midtown Manhattan. Despite elaborate contingency plans barring cars with fewer than three occupants from major bridges and tunnels, and reversing lanes for rush hours, the traffic jams will be monstrous.

As the final rounds of bargaining began, Transport Workers Union leader John Lawe raised the prospect that a strike would destroy his union.

Because strikes by public employes are illegal in New York, individual strikers could be fined two days' pay for each day of a walkout and the union would lose roughly $100,000 weekly in dues.

Lawe said that it would be difficult for his union to survive the dues loss but that he still would call a strike if the MTA does not improve its offer of a 10.5 percent pay raise over three years. The union has been demanding a 30 percent increase over two years.

Mayor Edward Koch and Gov. Hugh Carey, who earlier had stayed away from the negotiations, were standing by and offering to help avert a strike amid speculation that a settlement of a 17 or 18 percent wage increase over two years might be reached.

The last transit strike in 1966 lasted 12 days, brought discomfort and financial loss to millions and damaged the shining political star of then-Mayor John V. Lindsay, who took office hours before the shutdown of the transit system, which carries 35 percent of all the nation's bus and subway riders.

The 1966 strike accelerated the flight of business from New York and was a harbinger of the increasing labor and financial problems that have plagued the city.

Thousands walked across the bridges into Manhattan then, a movement of pedestrians reminiscent, until one was close enough to note the briefcases and overcoats, of a crowd of refugees.

Others bicycled or hitchhiked, but many couldn't make it to work and therefore missed paychecks. It was estimated that employes lost $25 million a day in pay.

This year, more New Yorkers have taken warnings of a strike seriously and Manhattan hotels are booked solid by corporations whose key employes will be doubling up in rooms.

Special buses have been hired by some businesses. Boats have been chartered to bring people to work from Long Island. The Staten Island Ferry schedule will be augmented. Taxis will be authorized to pick up passengers with different destinations.

Bike lanes will be set aside on some major arteries. Special parking lots and car pool centers have been designated.

But adequate alternatives are not possible, and a transit strike in New York will be sure to mean chaos, frustration and financial loss, just as it did 14 years ago.