FEW FEDERAL agencies have ever made so serious an error as did the Federal Trade Commission when it started an investigation into television advertising aimed at children. The "kidvid" hearings, as they became known in the trade, triggered an outburst on Capitol Hill and elsewhere that almost cost the FTC its life. Now the commission's staff has recommended the whole matter be dropped and the commissioners, if they have learned anything during the last three years, will eagerly take their advice.

The children's television proceedings, of course, were only the catalyst in the drive that has seriously crippled the FTC and still threatens its ability to perform its important tasks. The proceedings became the example of a government agency's intervention in affairs better left to private individuals and the marketplace. Operating in the protective shadow of that example, one industry after another carried to Congress sad tales of how FTC rule or proposed rules represented unfair interference in its normal business practice.

Most of these complaints wre unimpressive, but the kidvid episode had so damaged the FTC's reputation that they got more credence than they deserved. That, coupled with the anti-regulation mood that was getting stronger, almost put the FTC out of business. As it is, the FTC has been stripped of part of its jurisdiction, reduced in size and subjected to a (highly questionable) legislative veto.

We are among those who, from the beginning, found the children's television proceedings misguided. The federal government has better things to do than to play national nanny, monitoring what children see and hear on TV. There may be, as the commission's staff now says, "legitimate cause for public concern" about the deceptive and perhaps harmful messages aimed at young children by television advertisers. But we continue to think, as we did then, that the people to deal with that problem are the parents of those children, acting individually and collectively against the products that are so advertised.

After taking itself out of this dispute, the FTC may be able to start rebuilding its role as the nation's most effective guard against false and deceptive advertising and to stop the effort now under way to strip it of its antitrust enforcement powers. The commission has learned a costly lesson. Congress should now let it up from the mat and give it a chance to carry out the important responsibilities assigned to it.