What was going on when I was born?

Democratic leaders in the House today used some of their harshest language to date in denouncing President Reagan's economic proposals and lobbying tactics. They also asserted that they were gaining ground in the battle that will decide the nation's spending priorities for the coming fiscal year. ''We've got the President of the United States a little bit on the run,'' Thomas P. O'Neill Jr., the Speaker of the House, told reporters. ''The American people, despite the President's charm and charisma and wonderful ability at a microphone, are suddenly beginning to realize the effects of his budget cuts.''

When they first met in late 1979, he was the prince in ''Swan Lake.'' She remembers his regal carriage and his dark, curly hair. He remembers her face and admits, with a mischievous grin, that it haunted him for months. When she first spoke, he blushed, not understanding what she had said. As an exchange student from Peking, he had made up his mind to devote all his attention while in the United States to studying dance under the tutelage of Ben Stevenson, the artistic director of the Houston Ballet. Mr. Stevenson had seen him dance in Peking and had invited him to be the company's first exchange student from China.

Secretary of Labor Raymond J. Donovan proposed today to lift a longstanding ban on industrial work at home, saying that such work should not be illegal. The issue came into prominence recently when the Labor Department sought to enforce the prohibition among women who were knitting skiwear in their homes in rural Vermont. However, the Secretary's proposal today covers not only the knitted outerwear but also the six other industries in which work at home was banned by statute 40 years ago. Union officials immediately assailed Mr. Donovan's proposal, saying it was illegal and that, if adopted, it would lead to broad violations of worker protections such as the minimum wage, child labor laws, health and safety rules, and overtime regulation.

The current worldwide abundance of crude oil, coupled with improved conservation of petroleum in the industrialized nations, is strengthening the American economy, according to economists and business leaders. This is in sharp contrast to the problems that oil brought to Western economies after the Iranian revolution two and a half years ago. Bulging worldwide oil inventories are 400 million barrels greater than normal, spot prices have slipped by more than $2 a barrel and expectations are rising that oil prices will decline or remain stable for the rest of the year. Government statistics show that the abundance of oil is already slowing inflation, aiding economic growth and cutting the United States trade deficit to the slimmest total in more than five years. These economic gains are also strengthening the dollar, which is approaching its record high levels of the early 1970's on the world's foreign exchange markets. (Page 29.)

Tens of thousands of people are obtaining United States passports under false identities each year with an ease that is undermining the integrity of the nation's passport system, according to State Department security agents. Investigators for the department's Office of Security in New York, Washington, Chicago, San Francisco and Los Angeles asserted in interviews this week that the problem had gone virtually out of control in the last five years. The problem has mushroomed, they said, largely because drug trafficking has become such a lucrative business, the State Department itself has made too little commitment to suppressing the use of illegal passports and other Federal agencies pay only minor attention to it. The question whether the Office of Security should have broader enforcement functions is now being debated in the Reagan State Department. The investigators, who said that drug smugglers were among the main users of fraudulently obtained passports, estimated that at least 30,000 and possibly more than 60,000 of the three million passport applications received each year were submitted by persons using names other than their own.

Japanese auto industry officials were uncommonly critical today of their Government's agreement to restrict car shipments to the United States. The agreement, said Eiji Toyoda, president of the Toyota Motor Company, was made ''with undue haste and insufficient appreciation of the real situation.'' Japanese businessmen seldom speak critically in public, and the auto makers' statements today reflected their intense objections to any restrictions on winning a healthy share of the big American market. Mr. Toyoda said American consumers and the Japanese economy would suffer as a result of the package. ''It is extremely regrettable that what is essentially an economic issue has been politicized in this way,'' he said.

A Federal judge ruled yesterday that the Irish Northern Aid Committee, an active fund-raising group with its main offices in the Bronx, must register as an agent of the Irish Republican Army. As a result of the decision, the committee would be required to disclose much more information about its activities, including an accounting of how much money it receives, where the money comes from and how it is spent. The decision, issued by Judge Charles S. Haight Jr. in Federal Court in Manhat- tan, grew out of a complaint by the Justice Department, which had accused the aid committee of violating provisions of the Foreign Agents Registration Act. Frank Durkan, a lawyer for the committee, denied the allegations and said he would appeal the judge's decision. Mr. Durkan, a member of the law firm of O'Dwyer & Bernstein, said late yesterday afternoon that he had not yet found time to read the entire decision.

The White House, Congressional leaders and the domestic auto industry today welcomed the Japanese Government's three-year plan to limit car shipments to the United States and said it should deflect moves in Congress to legislate import quotas. But Government officials and representatives of the 4,000 dealers who sell Japanese cars in this country warned that the action could add to inflation through higher automobile prices resulting from a reduced Japanese supply. Robert M. McElwaine, president of the American International Automobile Dealers Association, said that a Japanese car on which a consumer might have received a discount yesterday would no longer be discounted today and that, ''by next week, you might be paying over list for certain attractive models.'' Reagan Depicted as 'Pleased' Larry Speakes, the acting White House press secretary, said that President Reagan was ''pleased'' with the accord and that it should give the auto industry ''time to retool and become competitive,'' a point echoed by Philip Caldwell, chairman of the Ford Motor Company.

Senator Harrison A. Williams Jr. of New Jersey was found guilty last night of bribery and conspiracy charges stemming from the Justice Department's Abscam investigation of political corruption. After 28 hours of deliberation over two and a half days, a jury of eight men and four women announced the verdict against the 61-yearold Democrat and a co-defendant, Alexander Feinberg, in Federal District Court in Brooklyn. Each was convicted of all counts in the nine-count indictments. Senator Williams faces up to 15 years in prison as well as the possibility of Senate sanctions that could range up to expulsion. Mr. Williams is the first United States Senator since 1905, and the third in history, to be convicted of criminal charges while in office, according to the Office of the Senate Historian. Concealed Interest in Mine In addition to bribery and conspiracy, Senator Williams was convicted of receiving an unlawful gratuity, conflict of interest and interstate travel in aid of a racketeering enterprise.

Thousands of people were stranded briefly in airports today as air traffic controllers staged their second walkout in a week. Workers at a submarine base also struck.

The Central Intelligence Agency concluded some years ago that Israel had developed nuclear weapons, aided in part by uranium diverted in the mid-1960's from a plant in Pennsylvania, according to a former Deputy Director of the agency. In an interview this week, Carl Duckett, Deputy Director for Science and Technology from 1967 to 1976, said there had been a ''clear consensus'' in the agency that the ''most likely case'' was that the Israelis had fabricated nuclear weapons with 200 pounds of enriched uranium diverted from a nuclear processing plant of the Nuclear Materials and Equipment Corporation in Apollo, Pa. ''I believe that all of my senior analysts who worked on the problem agreed with me fully,'' Mr. Duckett said in an ABC News documentary on nuclear weapons and the Middle East.

A grenade exploded tonight at a left-wing rally here, killing 2 people and seriously wounding 80. Witnesses said that 400 other people were recovering from lesser wounds received during fighting at the rally.