What was going on when I was born?

The merger between Continental Air Lines and Western Airlines was dealt a potentially fatal blow yesterday when the Civil Aeronautics Board approved a bid by Texas International Airlines to buy control of Continental. The five-member panel's vote was unanimous. The agency first voted authorization of the Continental-Western merger. But that became academic when the C.A.B. then gave Texas International permission to raise its holding to 48.5 percent of Continental's shares and the right to vote its shares against a merger of Continental and Western. Texas International began gathering commitments for Continental at $13 each in early February.

Peter Tufo, chairman of the city's watchdog Board of Correction, declared yesterday that New York City jails were so overcrowded that the situation had reached ''crisis proportions.'' A spokesman for the city's Department of Correction said that within the next few days the city will announce its short-term solutions to the problem. Mr. Tufo said in an interview that within the last eight weeks the number of inmates in city jails had jumped by 1,303 to 9,243 and that experts expected the trend to continue. City jails were designed to house around 8,300 inmates, he said.

Almost nothing touches people as much as the death of a child. The waste of a life at a young age is deeply disturbing, but it is made even the more poignant as many parents almost unavoidably identify with the loss. When two young boys attending the same school died 10 days apart in Dix Hills, L.I. recently, there was even more than the usual community pain. It was possible, at least in the minds of the parents and some doctors, that some deadly contagion was in the air. The parents not only identified with the loss of other parents but imagined it happening to themselves. Although health officials stressed that no public health threat was at hand, the reassurances did not salve the fear of most parents. In fact, a panic that drew national attention ensued. Throughout this period, health officials had to stay sensitive to that panic but still keep a tight lid on their own emotions so that they could go about their painstaking medical work. Scores of pathological and other tests were needed to determine if the two deaths were linked. Additional virological and bacteriological tests were needed to rule out an unrecognized outbreak of a communicable disease.

Governor Carey called today for a $5 billion five-year program of improvements in the Metropolitan Transportation Authority system ''on an emergency basis,'' and asked that the agency be excluded from a broad range of regulatory procedures in acquiring land and equipment. But Mr. Carey said he did not plan to provide any new state operating aid for the transit system in this year's budget, although, he said, that was ''not to foreclose'' negotiations on such aid. The chairman of the Transportation Authority, Richard Ravitch, said that without new money, a 10-cent to 15-cent increase in bus and subway fares and a 20 to 25 percent increase in commuter fares would be needed by the end of the year to cover an expected $170 million deficit for the authority. Need for Funds Stressed The lack of new operating aid drew immediate criticism from Mayor Koch, who said here that the state must address the transit system's need for operating funds at the same time as it addresses its equipment and maintenance needs.

The conflict over energy policy between the federal Government and the province of Alberta intensified today when the central Government placed a special tax on crude oil and blamed Alberta for having forced the levy. Ottawa said the added tax revenue was needed to pay for an increase in crude oil imports to offset a 10 percent cut in production yesterday by Alberta. Marc Lalonde, Minister of Energy, Mines and Resources, blamed Alberta's government for the tax, saying the federal Government had had to respond to the province's ''regretta@ble'' decision to cut output. The tax will be levied nationwide and passed on to retail product prices. The effect on consumers works out to about 1.7 cents a gallon (United States funds). A gallon of regular unleaded gasoline in Ottawa now costs about 92 cents.

Medical researchers have recently found an abnormally high number of cases of fatal brain cancer, a relatively rare disease, among workers in several American oil refineries and petrochemical plants. Their findings, though arousing some objections from industry, pose one of the most complicated and perplexing medical enigmas faced by medical researchers and industrial health experts. Scattered clusters of different types of cancers at some chemical plants in the last decade had cast a measure of suspicion on the chemical industry, but there had been little, if any, epidemiological evidence to support the suspicion. Within the last two years, however, studies by Federal epidemiologists and doctors have revealed up to twice the expected number of brain cancer or brain tumor deaths in a variety of chemical and oil processing plants in the United States, most of them situated along the Gulf Coast of Texas and Louisiana. These cases include the following: - The Union Carbide petrochemical plant in Texas City, Tex., had 18 fatal primary brain cancers in about 2,000 workers, approximately double the number expected in a normal population of that size.

The International Monetary Fund today approved a $550 million loan to China, marking that country's largest borrowing from any financial institution. The Washington-based I.M.F., which makes funds available to countries in balance-of-payments difficulties, said it had approved a so-called standby borrowing arrangement under which China would draw down 450 million special drawing rights (an internationally created reserve asset), equal to $550 million, over the next 12 months. The fund said that China would also borrow an undisclosed amount from the institution's trust fund, a pool of money raised from the sale of gold. It is used to help countries particularly strapped financially. The advent of China as a significant borrower at a time when other poor countries are having increasing economic trouble because of higher oil prices could have major financial implications.

The Reagan Administration is contemplating reducing sharply the number of Government employees in New York City and nine other Federal regional centers, a White House official said today. Robert B. Carleson, special assistant to President Reagan for policy development, said that the Administration's plans to shift Federal control of numerous health and social service programs to the states would ''naturally'' diminish the number of Government employees across the United States. The 10 regional centers affected are: New York, Boston, Philadelphia, Chicago, Atlanta, Denver, Dallas-Fort Worth, Kansas City, Mo., San Francisco and Seattle. ''The regions are going to have to be examined,'' said Mr. Carleson, who directed California's Department of Social Welfare in 1971-73, when Mr. Reagan was Governor. ''We'll have to take a look at all the Federal people involved in administrative tasks which would no longer be required by shifting to block grant programs.'' Under the block grant proposal, state and local employees absorb the duties formerly carried out by Federal employees overseeing programs that deal with health, social welfare and education.

GROUP By WILLIAM BORDERS LONDON, March 2 - Twelve Members of Parliament resigned from the Labor Party today and said they would form a new party known as the Social Democrats. The move was a major milestone in British politics, creating a new party in the ideological center, between Labor and the Conservatives.

Though money for higher education is as tight as ever in most sectors, a rising market has been developing in recent years in one of the quieter corners of university life: business financing of chairs or institutes devoted to the study of private enterprise. Since the country's first private-enterprise chair was established at Georgia State University in Atlanta in 1963, more than 40 colleges and universities have followed the trend, asking corporations for money to help get the message of American business across. Dr. Craig E. Aronoff of Georgia State, the president of the Association of Private Enterprise Education, says that although there was a falling off of endowments last year the emergence of the Reagan Administration and its economic emphases has renewed interest. Many of the chairs are at small institutions in the South and Southwest, but larger institutions have recently succeeded in attracting corporation money - up to $1 million for an endowment. Among the established chairs are ones at the University of Texas, the University of Wisconsin, the University of Southern California, Purdue University and Vanderbilt University. The University of Oklahoma joined the group last year, and Notre Dame is among others working on it.

''We are out of jail space. We have no more room.''

The most popular attraction for foreign visitors in all of Canada, some Federal officials here agree, may not be Niagara Falls or any of the country's other spectacular stops, but the Robo gas station over at the corner of Princess and Waterloo. Canadian gasoline prices are now as much as 56 cents a gallon cheaper than those in the United States and thousands of recessionridden residents of Buffalo are crowding across a three-lane bridge into this border community hungry for the bargain. The difference in prices, caused by recent surges in American gasoline prices and price control policies of the Canadian Government, has brought major traffic jams at all hours to the Peace Bridge, major upheavals in life on both sides of the bridge and a modicum of madness: new stations seemingly opening on every available lot here, arguments and fisticuffs in all-night gas lines and motorists taking the cheaper gasoline home in bleach bottles, canteens and Tupperware containers. Boom-Town Atmosphere The Peace Bridge, which connects with downtown Buffalo, gets more traffic than any single port of entry into Canada, officials say, and the majority of the current daily average of 21,000 vehicles packing it day and night are making trips to gas stations here. The station closest to the bridge, the Robo Gas Bar, attracts as many as 2,000 automobiles a day.