The conflict in the Falkland Islands must not be minimized in terms of international law and tragic loss. But in the cold lexicon of strategy and security more of the headlines ought to be going to the far bloodier war between Iran and Iraq. There a worst-case outcome could threaten a whole region whose stability is vital to world peace and progress, let alone the lives of its own people.
For all the onus on Iraq as the invader of Iranian territory, the burden of forestalling such an outcome falls to Iran. With their military victories, the Iranians have shown that they were not in such vulnerable disarray as advertised by opponents of the revolution. They now have the opportunity to show themselves capable of the arts of peace. Thus they could begin restoring a reputation in keeping with their national potential--a reputation shattered by the excesses of leaders bringing terror to their own people as well as to those Americans made hostage in their midst.
Iran's opportunity lies in responding to world opinion against answering Iraqi invasion with Iranian invasion. It lies in adhering to its own spokesmen's denial of designs on any other country; in leaving to the Iraqis the question of strongman Saddam Hussein's removal as demanded by Ayatollah Khomeini.
Syria, Iran's key Arab ally, recently did its part by warning it would end its support if Iran pressed its advantage by invading Iraq. The Arab allies of Iraq in the Gulf Cooperation Council have taken a new and less hostile tone toward Iran in calling on it to halt while it is ahead--and, according to diplomatic speculation, offering the carrot of substantial financial ''reparations.''
The religious dimension of the conflict is one of those lingering imponderables. Iran is supposed to want to spread its Shia form of Islam beyond its borders. Yet only some 10 percent of Muslims are Shia, and some of the majority want Shia to be considered another religion and not Muslim at all.
In any event, the way to spread a religion is not by the sword. Iran and its religion - not to mention its revolution for export--are going to be judged now on the kind of example they set in the world.