'This nation couldn't afford the loss of New York's library'

March 1981: Vartan Gregorian sits in a dark restaurant in the nether reaches of New York's Pennsylvania Station, arguing doggedly for a brighter future.

The swarthy Armenian emigre has just been appointed head of the New York Public Library. He acknowledges that, along with the country's other great municipal libraries, this one is ''in danger of flickering and guttering into a cold relic, like a spent candle.'' But he promises that this particular candle will soon provide a strong and lasting flame.

To anyone who has watched this institution - intellectual home for generations of the country's foremost authors and thinkers - become the refuge of crumbling books and homeless vagrants, Dr. Gregorian's hopes smack of wishful thinking.

Well, one man's wishful thinking is another's blueprint for progress.

Two years later: Gregorian roams around the must-and-marble president's office, looking a bit like Yasser Arafat with a magna cum laudem upbringing. He has just accepted yet another honorary degree, which notes that, when he took office, everyone expected that he would disappear into the library's 80 miles of stacks and emerge in a couple of years with a few tentative proposals for improving the library.

In a lengthy interview, he points out that, as the degree citation notes, he has far more than proposals to show for his two years in office.

''There's a sense of inevitability in the civil service that nothing can be done,'' observes Diane S. Ravitch, an educator, author, and library trustee. ''Gregorian came in like a ball of fire - at a time when public services in New York had been in a decline for years - saying that this institution is too vital to abandon, that it could and would be saved.'' He seems to have made good on his word.

Through a combination of carefully orchestrated events that draw attention to the library's importance, and assiduously developed personal contacts, Gregorian has made everyone aware, not of the library's troubles, but of its enduring value to the city and its people. Observers say he has created a broad constituency for the institution.

''We are not playing on the guilt of the individual,'' he says of the library's fund-raising efforts, ''but on the intelligence of the individual.'' And most observers agree he has turned the stuffy old president's office, which looks like an appropriate inner chamber for the pyramid of Ramses II, into a freshet of new ideas.

The first and most important idea, he says, is that ''this society, this culture, this city, this nation, could not afford the loss of the New York Public Library. That I took as a given. The question is not whether this institution can survive; the question is the quality of that survival.''

The quality of survival seems to be looking better these days.

In the past two year, the library's circulation has increased by 14.4 percent - after a decade-long steady drop - from 7.8 million to 8.9 million in one year. The National Endowment for the Humanities awarded the library a $2 million matching grant last year, the largest it had ever given to a single institution. Just this month, they announced another $2.2 million for this year, again the largest grant in its history.

As a result, central library hours, once slashed from 87 to 46 hours a week, have been moved back up to 57 hours, meaning that it is once again open on Thursdays. Three branch libraries - Donnell, St. George, and Fordham - will be open on Sunday for the first time in 10 years. The library system is engaged in a $25 million restoration project; so far, $4.6 million has come from the city, with $6 million raised by the library.

Almost all the credit for this good news, according to almost everyone you talk to, belongs to Vartan Gregorian.

The city's puckish and volatile mayor, Edward I. Koch, describes Gregorian as ''unique, . . . brilliant, both as an administrator and someone who knows how to work with everyone and get their support.'' Significantly, he adds, ''He and I have become good friends,'' a statement one hears of Gregorian from many of the city's movers and shakers.

The first thing you notice about this man, who so easily makes friends in high places, is the improbably abrupt upsweep of bushy hair above his rotund, genial face. Almost immediately thereafter, you are impressed by an apparent generosity of spirit - an impression that is borne out by library employees, from top to bottom. As he leaves the library late one evening, Gregorian banters easily with a guard at the entrance. You are reminded of the fact that he knows cleaning people, guards, and file clerks in the sprawling institution by their first names.

Brooke Astor, a leading New York City philanthropist, resigned her many board positions last spring to devote herself exclusively to the library's well-being. ''The thing that drove me to it,'' she says in a telephone interview early one morning, ''was Gregorian. He is just such a vital character, and he put so much life into that place. He has really galvanized the organization. His feeling, his enthusiasm . . . like Don Quixote, he will tilt at any windmill. Only he generally wins.''

''He came to New York and took it by storm,'' says former parks commissioner Gordon Davis. ''Gregorian is a very special commodity, a mixture of wit, charm, intellectual rigor, knowledge, and worldliness. The depth of your affection just grows and grows.''

Gregorian does not, however, have a reputation as an easygoing charmer in some situations.

In March, for instance, he told the city council's finance committee that it was demeaning for the library to have to come back year after year and defend the right of libraries to exist. In the future, he said, he would no longer discuss the subject, and would only come to present the library's financial case for a fair share of the city's coffers.

Fellow administrators sat in stunned silence, awaiting the politicians' angry response. It never came.

The New York press has lionized Gregorian for just this kind of gamesmanship. He has received the treatment any conquerer gets from this victory-conscious city. But there has been an added quality of admiration, which grows out of a recognition that what he has accomplished affects the cultural well-being of every citizen in the city and touches the intellectual life of the country and the world.

''I have never had to apologize for this institution,'' Gregorian says. Instead, he has emphasized the fact that the library stands for ''culture in general, society in general, education in general, the foundations of a democratic society in general, free access against monopoly of information.''

Those are admittedly sweeping ideas. And New York has a reputation as a city that looks for hard tangibles to back ideas up. Somehow, however, Gregorian seems to have convinced the people that make things happen here that the ideas themselves are tangible.

Ideas are the most useful commodities the city has at its disposal.