What was going on when I was born?

Joe L. Allbritton, a Texas financier with experience in running distressed newspapers, has agreed to take over The Daily News, he and the owners of The News said yesterday. He has 30 days to negotiate with the paper's 11 unions, which have already acknowledged that some of the paper's 5,000 jobs will have to be cut to assure its future. The announcement by the owners, the Tribune Company of Chicago, and Mr. Allbritton, a former owner of The Washington Star, came after a three-month search by the Tribune Company for someone willing to gamble on being able to reverse the News's losses of $11 million last year and a possible $50 million this year. Trump Balked at Liability The agreement came after a last-minute break in negotiations with Donald J. Trump, a New York real estate developer who had been seeking to buy The News but who balked at taking on extra liability should the paper die. The agreement leaves the paper's chief physical asset, its 37-story Art Deco office building on East 42d Street, with the Tribune Company.

The Senate Armed Services Committee today proposed shaving $3.2 billion from President Reagan's $216 billion military budget. Senator John Tower, Republican of Texas, chairman of the panel, made it plain that the committee had adhered to most of the Administration's weapons programs but had decided to cut most of the money from two of them, the interim deployment of the first 40 MX intercontinental missiles and production of the Army's new attack helicopters. Critics on Capitol Hill and elsewhere have said that $10 billion, or even more, could be lopped off the military budget, especially in Navy and Air Force programs. They contend, for example, that the B-1B bomber, whose overall cost could be $20 billion to $30 billion, is unnecessary and would be vulnerable to Soviet attack by the early 1990's.

THE correlation between music and ritual has been close throughout history and among all peoples. In the Christian churches, it has led to a spectacular, if unforseen, result: namely, the creation of a vast body of written music, whose complexity and variety have fueled constant growth and renewal. Even though Western music long ago stepped outside the church and began a life of its own, for the millennium and some centuries that it has been a recognizable entity, most of its activity has been in the service of the church that gave it birth. And it still seems to have close ties. It is interesting to see, for example, that as the Christian year reaches its zenith in the Easter season, musical activity also reaches a high-water mark and for a short time resembles the musical life that was the source of the tradition. During the 10-day period beginning today and extending through Easter Sunday, sacred music will once again be in the ascendant. Not only will New York's churches be filled with it, but the concert halls - monuments of music's liberation from the liturgy - will also be recaptured. Musical life will flourish and, in the process, remember its source.

Senator Russell B. Long of Louisiana, the ranking Democrat on the Republican-controlled Finance Committee, lined up with the Administration today in defense of the 1981 law that loosened the rules governing the use of leasing agreements to sell tax benefits. Senator Long's fervent statement of support as the committee began discussing how to raise revenue, and an attack on the law by Lloyd Bentsen, Democrat of Texas, were seen as signs that a hard battle over leasing is ahead. Senator Bentsen is Senator Long's friend and usually his ally.

''Fellow came by the other day and said, 'If I could just get back up to broke, I'd quit.'

The Reagan Administration, which some critics have called soft on corporate mergers, formally described for the first time today new guidelines it is developing to analyze proposed combinations under the antitrust laws. In general, the new approach puts much greater emphasis than before on defining relevant markets and introduces specific numerical standards by which these can be determined. In addition, the Government will employ a more precise tool, known as the Herfindahl index, to assess the market concentration that would result from a given merger. Today's preview of the Justice Department's long-awaited revision of its merger guidelines was provided by Attorney General William French Smith in an address before antitrust specialists of the American Bar Association at the Shoreham Hotel.

If there is one point of agreement on the nagging question of why interest rates remain so high, it is that nobody knows for sure what the answer is. The refusal of interest rates to behave properly - to fall as expected for so long - is serious. The high rates are threatening the recovery from this second recession in two years. And the continued uncertainty over the reason makes choosing a solution more difficult and guaranteeing that it will work riskier.

This small Greek island, long the undisputed leader in the natural sponge trade, has been stunned by a sudden, aggressive challenge from Cuban-Americans exploiting virtually untapped sponge grounds off Key West, Fla. Sponges from Cuba have for years been a factor in the world market, according to experts here, but in the last six months whatever threat they represented has been critically aggravated by the entry of the Cuban emigres in Florida. In fact, local traders are even talking about the extinction of their business. Nowadays, during a time when the island's 60 sponge trawlers are usually hard at work, the fleet is sitting idle at the dock, faced with the dismal prospect of missing a whole season's harvest. ''We are being ruined,'' says George Sakelarides, 68 years old, who for the past 25 years has been the general secretary of the Kalymnos Sponge Suppliers Cooperative. ''We still have the best quality natural sponges in the world, but we cannot match the Cuban and American prices.''

The Sports People column yesterday incorrectly identified the winning team in an exhibition game during which Fernando Valenzuela pitched for the Los Angeles Dodgers for the first time this year. The Dodgers beat the Boston Red Sox, 8-7, in 10 innings.

President Reagan's assertion that the Soviet Union had achieved military superiority over the United States was disputed today by both proponents of a nuclear arms freeze and by one of the chief supporters of his arms policies. At a news conference on Wednesday, President Reagan said in response to a question, ''The truth of the matter is that, on balance, the Soviet Union does Wall Street economists disputed President Reagan's argument that the United States Government was powerless to do anything about high interest rates. Page D12. have a definite margin of superiority, enough so that there is what I have called, as you all know, several times, a window of vulnerability.''

In pressing his case for a major buildup in strategic arms, President Reagan went further than any previous President in crediting the Soviet Union with ''a definite margin of superiority.'' This has prompted disagreement over the nuclear balance and raised concern about the impact of the assessment on the Western allies. Mr. Reagan's comments were endorsed by Senator John Tower of Texas, who is chairman of the Senate Armed Services Committee. ''I think the President is to be commended for being so candid about the situation,'' Senator Tower said. But others, inside and outside the Administration, were uneasy both with the President's sweeping judgment and the fact that a President had taken the risk of expressing such an unsettling view.

President Jose Napoleon Duarte said in an interview Wednesday night that he would try to remain in the Salvadoran Government despite the attempts of more conservative rivals to oust him. El Salvador's newly elected Constituent Assembly has the power to appoint a provisional government that would replace the present junta and rule until presidential elections are held. The assembly could also vote to retain the present junta. ''I think that the people believe that I should stay in the Government,'' Mr. Duarte said in his first interview since his Christian Democratic Party finished first in the voting last Sunday for the Constituent Assembly. Duarte Lacks a Majority The Christian Democrats failed to win a majority of the assembly's 60 seats, and four minority parties have declared that they want to form a government that would exclude Mr. Duarte's party.