IN THE LATE 1960s, when Washington was still showing a degree of concern for the poor, the U.S. Office of Economic Opportunity (OEO) hired me to help investigate housing conditions on the Rosebud Sioux reservation in South Dakota. With a team of self-confessed experts I visited all 22 villages, from Two Strike to Milk's Camp, and discovered, among other this, that families there had much to endure. Many occupied dirt floor huts bereft of adequate heat and running water; some were forced to sleep, even to cook, in rusted-out car bodies. The families were virtually defenseless against the frequent blizzards that swept the South Dakota prairie.

Our architectural consultant, a cheerful young provincial from Chillicothe, Ohio, went from door to door asking astonished Sioux mothers whether they--preferred gas stoves to electric stoves; whether they liked bunk-beds; whether the children could use a "mud room" for their boots and galoshes. The poor fellow seldom received an answer.

At the time I attributed the mothers' reticence to the fact that their houses had no electricity, their rooms had no beds and their children had no boots. But there may have been another explanation. As a tribal leader admonished us, "You should not ask so many questions. The people think that there is a right answer and a wrong answer, and if they give the wrong answer, they will not get a new house." Over the centuries we have admired Indian silence as the complement of Indian eloquence. But the silence may also have been a way of staying out of trouble, of finessing a conqueror's catechisms.

Two of the people I met during that chastening sojourn at Rosebud were Nancy and Sam White Horse, who lived in an unpainted shack atop a wintery knoll near the town of Mission. Born around the turn-of-the-century, they had spent most of their lives on the reservation, taking strong roles in tribal affairs and sharing with other members of the tribe in the manifold miseries as well as the sporadic improvements that came their way: the new schools, the modernized health facilities and the paved roads that were occasionally vouchsafed to the Sioux of Rosebud.

Now the arrival of "Washington officials" gave grounds for hope that housing might be the next item slated for progress. "Our children need warm houses that can be lit with the electric," said Nancy White Horse, who already had many grandchildren of her own. Then, as we stood amid the tall yellow grass by her road, she made me a promise. "You're not the first to fly out here and look around," she informed me with a patient smile. "Nothing ever comes of it, but I'll tell you what: if you can get some houses built for my people, I'll make you a quilt."

In time, the OEO built 400 houses on the Rosebud reservation--and Nancy White Horse was as good as her word. The quilt she sent was a brilliant patchwork of red, orange and white, with a large green star at the center. Diane and I still have it, buy we do not sleep beneath it: the artwork seems to delicate, the colors too fresh, to stand nightly wear and tear. Besides, our house has central heating.

It was hardly surprising that the bargain Nancy White Horse struck with me would benefit the whole tribe--"I you can get some houses built for my people--rather than herself alone. In Indian country people tend to move forward in concert. Their individual struggles become a war of all on behalf of all. Nor was it unusual that out of the tatters of her daily life she should fashion for me a gift of great beauty. That, too, went with the teritory. In a culture with few commodoties and virtually no market, generosity can florish.

The second worst thing that can happen to a people is to be conquered. The worst is to live through the ordeal that follows: to submit. The suicides, the alcoholism, the mists of despair that today envelop many reservations all seem legacies of a colonial past that won't go away. "Winter in the blood" is the way James Welch, the Montana Blackfeet novelist, describes the consequences--a freezing up of the Indian psyche in the face of daily deprivations of the spirit. "I was," he writes, "as distant from myself as the hawk from the moon."

The policies that chilled rosebud are not difficult to trace, though in the beginning, as the U.S. Supreme Court later noted, Congress showed "the most anxious desire to conciliate the Indian nations." The famous Northwest Ordinance, which the first Congress ratified in 1789, stipulated that "The utmost good faith shall always be observed towards Indians; their land and property shall never be taken from them without their consent." But with the ascendance of Andrew Jackson the federal government abandoned all pretense of concern for Indian rights. In place of conciliation Jackson and his successors pursued a policy of removal and relocation, forcibly transfering eastern tribes to territories in the west. There followed a dismal procession of measures designed to wipe out tribal sovereignty and assimilate Indians into the white-American mainstream. In mid-century Congress established federal boarding schools for Indian children, where they were forbidden to speak their parents' language on pain of corporal punishment; in 1871 it abolished the practice of making treaties with Indian tribes; and in 1887 it passed the notorious General Allotment Act, which divided communally held tribal lands into separate, individually held parcels. The purpose was to break up the tribes' land base and turn Indians into farmers.

By the time the allotment system was repealed in 1934, tribal land holdings had dropped from 140 million acres to 50 million acres. John Collier, the New Deal Commissioners of Indian Affairs, did more than merely stop the hemorrhaging. Through the Indian Reorganization Act he coaxed from America a commitment "to rehabilitate the Indian's economic life and to give him a chance to develop initiative destroyed by a century of oppression and determinism."

If succeeding generations have blurred Collier's generous vision, we have nevertheless held fast to his dream of tribal integrity. Richard Nixon endorsed it in 1970, and Congress reaffirmed it five years later with passage of the Indian Self-Determination and Education Assistance Act. Even Ronald Reagan has pledged "to encourage and strengthen tribal government" and "to deal with Indian tribes on a government-to-government basis."

In dealing with Indians, however, this Administration remains true to its own peculiar vision of justice. It is using "self-determination" as a euphemism for self-sacrifice, shutting off tribal assistance while lecturing tribes on the virtues of standing tall. Last years Indian assistance funds were cut by more than-one-third, including a 44 percent reduction in job programs. Naturally, unemployment on the reservations jumped from 30 percent to over 50 percent. Reaganomics, it appears, means subsidy for the affluent and self-determination for the poor. We have invented an entirely new breed of fortunate victims: the starving free.

Still, the tribes persist--283 of them at last count--and it can be said that in some respects they thrive. At the turn-of-the-century the U.S. Indian population was under 300,000; today it is 1.4 million and climbing. Do the tribes know some thing we don't? Do they have something to teach Mr. Reagan--not, to be sure, about getting ahead in the world, but perhaps aboutnot getting ahead? Is it possible that life is more fruitfully lived in the Indians' circular way (the turning of the earth) than in our accustomed linear fashion (onward and upward)?

A few weeks ago I returned to Rosebud for the first time in a dozen years. It took me awhile to find Nancy White Horse because she had moved to a new neighborhood, a place named in honor of her husband who had died a few years ago: The Sam White Horse Housing Project.

Nancy's face bore more wrinkles than I'd remembered, and she walked very carefully now, but otherwise she seemed unchanged, and certainly undiscouraged.

"What happened to your other house?" I asked "The one we built for you."

"Oh," she said, "there was a fellow who needed a place to live. So I gave him the house."

I thought of John Wesley, that troubled missionary who learned something in the 18th Century that we have forgotten in the 20th. Homeward bound to England, Wesley gazed out at a tossing sea and wrote in his diary, "I came to America to convert the Indians. But oh, dear God, who will convert me?"

Richard J. Margolis, a writer, is a Fellow this year at the Institute of Politics, Kennedy School of Government.