To read the morning papers and monitor the network news shows Sunday was to be invited to believe that President Reagan's special Middle East Envoy Philip Habib is disqualified by a crippling conflict of interest. The innuendo was that he was so lacking in integrity and divided in his loyalty as to be willing to sell out U.S. interests to Arabs for a mess of consultancy fees from the Bechtel Group. In short, you were invited to believe the unbelievable.

So why worry? Habib's distinguished career as a professional foreign service officer speaks for itself. Still more so does his willingness to emerge from retirement (in 1978, after serious heart trouble) and to plunge for the third time into what has to be the most brutal and demanding peace-making mission in memory. Habib needs no defense.

The worry is whether the millions of newspaper readers and television viewers who watched what I saw unfolding Sunday may not need some better defense against what struck me as nearly hysterical hunger for impropriety. The point is emphatically not whether Habib's Bechtel connection was a fact worth revealing (in The Washington Post) and repeating and examining at regular intervals on all three networks. But surely the next question has to be: what of it?

And to leave the examination of that question almost wholly in the hands of Sen. Larry Pressler (R-S.D.) was to transform a fact of arguable significance into, let's face it, a smear.

Watch how it spread. In The Post's account, Pressler charged that Habib "will lose all his credibility in the Mideast and I think it is going to impair the effectiveness of Secretary Shultz. . . . There are too many people from Bechtel in this administration. These international conglomerates have too much power."

On those last two counts, Pressler may be right. With Shultz, Defense Secretary Weinberger, and deputy secretary of energy Davis (all former Bechtel men), the disclosure of Habib's consultancy does make it a bit much. Maybe there should be a law--and one to bust up conglomerates, as well. But Pressler wasn't recommending laws. He was saying Habib would no longer be trusted.

The Post story, with Pressler still the only independent witness, was picked up by the wire services and dispatched to morning papers nationwide. By mid- Sunday, ABC's "This Week" talk show was giving Pressler another solo whack at Habib. Came time for the evening news, and CBS had Pressler "charging conflict of interest" and moving from judgment to pronouncing sentence: "I feel strongly that Habib should resign." A half-hour later, it was NBC, breaking the news that the American "peace envoy" in the Middle East has a second employer, Bechtel, the California construction firm that does business with Arab firms." And Pressler was back again on camera.

But he was followed, finally, by Sen. John Glenn (D-Ohio) with a second opinion: Glen was "surprised" but "not much concerned." He thought Habib was doing "a tremendous job." It bears noting that care was taken all along the way to solicit a White House view-- strongly supportive, as you might expect.

By Monday, other incidentals had surfaced: that Habib was actually hired by Bechtel last year as an Asian expert; that he had done little or nothing for the firm while in the course of his tireless Mideast rounds. That Shultz had not disclosed Habib's Bechtel connection, the explanation went, was simply consistent with his point of principle concerning his own--that it was no impediment to loyal public service.

That's the nub of it: at some point there has to be some element of trust, the more so when there is the oversight provided by performance on the job. Habib is only the most recent in a long line of former high office holders (Cyrus Vance, Clark Clifford, John J. McCloy, former Mideast mediator Sol Linowitz) who have taken on special government assignments effectively without relinquishing private financial ties.

But what of Bechtel's Arab involvements? What of appearances? That's the heart of Pressler's argument. And you would expect some response from Israel; but if the Israelis have suddenly found new grounds for distrusting Habib, they are not saying so.

A better answer can be found, however, by reducing the argument to its absurdity: forget the indirect Bechtel connection to "the Arabs"; Philip Habib is what you might call an Arab-American, born to a Lebanese father, but in a predominantly Jewish neighborhood of Brooklyn. Try to figure out the prejudices or predilections engendered by that background in formative years.

Or better still, don't. The issue here is not Habib. It has more to do, I think, with a pervasive instinct to distrust--a lingering legacy from the trauma of the Watergate and Vietnam years when too-easy acceptance of dissembling or impropriety played us false. To forfeit the services of Phil Habib in this spirit would be to demonstrate that this can cut two ways. Just as you can go wrong by believing everything, so can you go just as wrong be not believing anything.