May 31, 1990

LEAD: Long esteemed on Wall Street as a scrappy little airline that thrived in a business dominated by Goliaths, Midway Airlines Inc. now finds itself in a brutal competitive struggle that has dealt the carrier heavy losses. The outcome, industry experts agree, will be decisive: Either Midway will become a larger and more profitable airline or a badly wounded also-ran.

LEAD: President Mikhail S. Gorbachev of the Soviet Union arrived in Washington tonight for his third visit to the United States and his second summit conference with President Bush, as American officials searched for formulas to persuade him to accept Western plans for a unified Germany and a restructured Europe.

LEAD: Because of Shabuoth, alternate-side parking rules will be suspended today.

LEAD: For the third year in a row and the fourth time in five years, N.J. Transit is raising bus and train fares, this time an average of 9 percent.

LEAD: In his first day as President of the Russian republic, Boris N. Yeltsin put the Kremlin on notice today with an aggressive program to free Russia from ''the dictates of the center.''