I ARRIVED IN SANTIAGO, Chile with my father on Dec. 15, 1985, at 1:30 a.m. The first sight that greeted us as we emerged from the airport was a sign looming above that read, "Chile progresses in peace and order."

Thirteen years ago, Chile, under the leadership of President Salvador Allende, was one of the few Latin American countries with a democratic government. A generation of popular leadership had made significant progress in social and economic reform, putting in place the rudiments of a welfare state. As one prominent journalist told me, "We had a tradition of democracy that made men proud. The Moneda [Presidential Palace] was a public way, and the president walked down the street like you or me, and took off his hat to say 'Hello'!"

In 1973, a military junta, led by General Augusto Pinochet and backed by the United States, overthrew the Allende regime. The coup toppled not only the nation's popular leader but also the nation's tradition of democracy. Chile progresses in peace and order.

Tens of thousands of Chileans were exiled that year; many of those that left have just begun to return. Martial law was instated and has only recently been relaxed. But do not be deceived. Chilean repression has grown more sophisticated, but not weaker nor less widespread.

WE CAME TO CHILE with a test in mind: Jeane Kirkpatrick's famous authoritarian/totalitarian distinction. This Administration lends military and economic aid to the junta in Chile on the theory that authoritarian governments are "better" than totalitarian ones--that, right-wing rulers are less pervasively repressive than those of the left, more culturally tolerant, less ideological, more amenable to corporate interests, and more susceptible to change. Therefore, the argument continues, to prop up right-wing repressive governments not only protects American interests--in Chile, that means ITT--but also prevents the country from going Red, presumably foreclosing any future hope of democracy.

Certainly, Santiago appears to be a prosperous, industrial metropolis. That much of Kirkpatrick's distinction holds true. The capital, where a large plurality of Chileans live, is a lovely city of tree-lined streets, public gardens, monuments in grassy squares, a speedy, modern 10-cent metro that rivals the one in Paris, and stylish shops with bright displays and billboard ads. A far cry from the drab exterior of your average Eastern-bloc country.

AT NEWSSTANDS four opposition magazines and L'Humanite, the French Communist paper, were available along with El Mercurio, the official newspaper. This past year, demonstrations of nonviolent opposition to the junta began on campuses and spread through the city. Our friends described to us the moving spectacle of the people marching down the Alameda, open palms raised to show "Our hands are clean," as black helicopters--no doubt American-made--circled just feet overhead. But the government did not halt the protests.

People told us one had to watch one's words in public, yet they were very free with us in voicing their opposition to the junta. Furthermore, the government has not developed an oppressive, Orwellian ideology, but preaches only anti-communism. "Chile progresses in peace and order" was the first and last slogan we were to see in the country. Chilean propaganda is not propagated in manifestos and youth groups but through anaesthetic state-controlled television and movie imports like Rambo.

So what's to complain about? Why shouldn't we give aid to the government of this sunny country?

BECAUSE THE FACE of a free nation in Chile is a facade on every level. When we first drove in from the airport, we were shown houses damaged by a serious earthquake that hit Chile the year before last. There were holes in some of them, but most of the houses, our friends explained, fell inward, leaving the four outside walls standing with nothing left inside. Chile is also a four-walled facade, inside which terror strikes under the cover of night.

Jorge is a law-abiding citizen of Santiago, an academic. He drives a Fiat, goes to the movies, shops at the overflowing markets, and lives in a nice part of town very near General Pinochet. At 2 or 3 a.m. most nights, he receives phone calls. The anonymous, "unofficial" callers say, "Your children are dead meat. We will cut off their arms and legs." And so on. About twice a year, Jorge attends the funeral of a friend who has disappeared in the middle of the night. Also unofficial.

There are opposition magazines, yes. And for the last four years they have not had to send copy to a censor's office. Elisabeth, star political reporter for the best of these magazines, the New Left Apsi, writes in-depth critiques of the junta, often exposing Pinochet's weakness within the ruling elite. They are printed and read by perhaps 5000 people. The tiny circulation of these magazines insure that the cost to the junta of their being read by a handful of intellectuals is far outweighed by the benefit of bringing them before the U.N. as proof of Chile's free press. The junta knows also that many Chileans cannot read and that those who read these unsanctioned publications often pay a price not listed on the front cover.

Several months ago, two thugs came to Elisabeth's door and beat her senseless. She was in the hospital for a week. That's Chilean censorship.

SO ALL IS NOT WELL in sunny Santiago--the terror is there; it is just waged after curfew. Subtler, more sophisticated, but just as deadly. The other thing that is not immediately apparent to the outsider is that this lovely city is less than half of Santiago, and the other half you will never see.

Most citizens of the Santiago I visited had never been to the other part of the city, the barrios. The government tells them, and it is probably true, that it is dangerous for them to cross the line from the upper to the lower part of town. It is dangerous because the people of the barrios are desperate.