June 7, 1981

The houses and fishing shacks are daubed mint green, dandelion yellow, lobster pink and a palette of other hues. The church steeples are blindingly white, like the freshly laundered sheets flapping on the lines. The beaches come in two colors, white and red; the red, they say, makes better sand castles. Prince Edward Island, Canada's smallest province, is a vacationland by Technicolor, a panorama of wholesomeness that might make Disneyland seem risque. There is, in fact, a fairy-tale aura about this crescent-shaped island - 140 miles from tip to tip and in some places no more than four miles wide - curled off Nova Scotia and New Brunswick. Was this once a big island that some enchantress shrunk? Or is it a scale model that got out of hand?

The United Mine Workers and the bituminous coal industry signed a new contract here tonight that will put miners back on the job at 12:01 A.M. Monday after a 73-day strike. The 10:30 P.M. ceremony in the lobby of the union's headquarters came after a day of balloting in which the 160,000 union members voted overwhelmingly to ratify the 40-month pact. Sam M. Church Jr., the U.M.W. president, said late tonight that with the votes of only a few small locals remaining to be counted, the contract had gained nearly 70 percent approval, with 57,210 for ratification to 25,798 against, the largest ratification margin in the union's history. The contract was the second offered by negotiators of the union and the Bituminous Coal Operators Association, the bargaining arm of the major Eastern and Middle Western mining companies.

Ronald Reagan, the darling of the business community, has given business its first great surprise. The man who has delighted a generation of businessmen with his free-enterprise ideology has offered his tax compromise to conservative, deficit-conscious Democrats, and it comes largely and unexpectedly at the expense of business. Mr. Reagan has tailored a compromise that, to all appearances, favors supply-side fundamentalism - the sweeping, three-year, acrossthe-board tax cuts known as 10-10-10 - over supply-side theology - the more narrowly focused, greatly liberalized tax depreciation plan that business knows as 10-5-3. The new plan essentially stands by Mr. Reagan's sweeping, threeyear tax cuts and then pays for that stance with concessions on business taxes. Though undoubtedly the President espouses both approaches, his compromise favors the philosophy that the supplyside miracle - and political mileage - lies more in the dramatic, successive tax cuts for individuals than in more methodical tax relief for productive industry.

WASHINGTON AFTER the Rose Garden announcement of President Reagan's hastily revised tax-cut legislation, a reporter asked the President if he had the votes in Congress to pass the measure. ''I said we wouldn't take any questions, and I'm glad I said it,'' Mr. Reagan quipped in his amiable way as he headed back toward the Oval Office. In an aside to an aide, he was heard to murmur that no one ''really knows the answer to that question.'' The President's retreat from further inquiries was understandable. It came at the end of two weeks of the most intricate and confusing political maneuvering seen so far in the new Administration. The questions that hung in the air at week's end were tough ones, indeed.

It has been called ''the abstract Woodstock,'' ''the rich man's Provincetown,'' even ''the cradle of American art,'' and there is a certain truth to each of these epithets, for the last few decades have seen the avatars of the avant-garde as well as some of the foremost practitioners of landscape painting settle on that narrow strip of land known as the South Fork or East End of Long Island. There, amid the dunes and wastes of scrub oak, such artists as Willem de Kooning, the late Jackson Pollock, Lee Krasner, James Brooks, Adolph Gottlieb, Franz Kline, Roy Lichtenstein, Alfonso Ossorio, Larry Rivers and James Rosenquist made their homes and built their studios, and it was there that they helped redefine American - and 20th-century - art. Such a community of talent, of course, is wonderfully uncommon, and over the past half century, Guild Hall, East Hampton's center for the visual and performing arts, has done its best to show the work of these resident artists and others. Beginning this Wednesday, some of their finest paintings and sculptures will be on view at the Knoedler Gallery, in a special exhibition arranged as a ''salute'' to Guild Hall from New York's four major museums - the Guggenheim, the Metropolitan, the Modern and the Whitney - all of which have loaned pieces from their own collections.