ONE of our great problems as a nation is that we often don't know what our great problems are. I doubt, for example, that most Americans, if asked to list the top 10 national problems, would include that of money in politics. Yet money too often determines who will be elected to deal with the problems on that list, and, consequently, what may be done about them. No one who reads Elizabeth Drew's new book, however, will seriously dispute that money has come to be a dominant influence in American politics, and no reader devoted to democracy can help but be troubled by her strong and lucidly presented evidence that torrents of money, distorting and poisoning politics, have "delivered us into the special-interest state." She has a stark warning: "What is at stake is the idea of representative government, the soul of this country."

Politics and Money is the best single contemporary work of reporting and commentary in its field, partly because Drew's opinions emerge as if by iron logic out of her reporting. It is the reporting that is the primary basis for my accolade, although this is also the basis for some caveats: best, after all, isn't necessarily perfect.

In the summer of 1976, I remember being struck by the contrast between the national party conventions, which attracted battalions of reporters from every major news organization, and the small record room of the Federal Election Commission, where few reporters were to be seen. There it was possible to document, with relative ease, the proliferation of "political action committees," or PACs, that politicized mutation of the investment sector which was making what were misleadingly called campaign "contributions" to congressional candidates. What made the contrast even more striking was that the overwhelming coverage of the conventions, and later of the elections, continued effectively to treat money as a side issue.

Four years later, the battalions returned to the conventions, and the Federal Election Commission record room was much busier. So why should anyone have worried about how Ronald Reagan or Jimmy Carter was paying his bills, each having foregone private funding in order to get $29.4 million under the law providing for public financing of presidential campaigns? What almost no one (including myself) grasped is that something astonishing was happening, which Drew's reporting now exposes and documents: The public-financing law had been destroyed, to the point that "far more private money than public funds went into Reagan's presidential campaign." So much for the myth that Reagan and Carter were on an equal financial footing.

Ironically, the reason for this state of affairs, as she explains, was in good part the 1979 "party-building" law, a naive initiative of Democrats trying to get an edge for themselves. Little noted, and certainly little understood until The New Yorker published Drew's articles which she has updated into this book, the law allowed state and local party organizations to spend without limit to register voters, buy billboards, and the like. But the Republicans at the national level seized on the law to outspend the Democrats in the presidential race mainly by pouring the vastly greater sums of money available to them into the states of their choice.

"The public knows that something is very wrong," Drew writes. Her book is the zoom lens through which one can clearly see what the problem is. Most of all, the problem is that, increasingly, politicians are by money obsessed, because not to be obsessed by it, more and more of them fear, is to be defeated. Briefly, calmly, and lucidly, Drew provides the historical setting and the essential facts and numbers. Her memorable case histories include the "independent" oil men who, from pockets as deep as their wells, pumped out the cash that helped to procure the Senate for the GOP; the Democratic Congressmen who, filling pockets hanging down to their socks, helped to give the oil men, Reagan, and other interests the iniquitous tax breaks of 1981, and the bipartisan House and Senate coalition that overturned the Federal Trade Commission regulation requiring used-car dealers to list the known major defects of an automobile. "Of the 286 House members who voted to kill the FTC regulation," Drew notes, "242 had received money from the auto dealers." None is known to have received money from used-car buyers.

Drew explains how we got into this jam: The 1979 "reforms," and the frustration of them, that legitimized uses of money that had been illegal since 1907; the nearly futile Federal Election Commission, which was enfeebled by its creator, Congress; the ascendency of the lawyer-lobbyists; the absence of laws to control "soft money"--funds which cannot be directly used for federal campaigns; the Supreme Court's foolish approval of "independent" expenditures, of which $12 million went for Reagan and $46,000 for Carter. Finally, Drew endorses some long-discussed possible changes in the rules of the game, including banning political advertising on television while providing candidates with free time on the public's air waves.

Drew elicits, and uses in just the right places, a plethora of pungent, revealing quotes. Examples:

Richard Bond, deputy chairman of the Republican National Committee: "If Mobil Oil wanted to give you 20 million bucks, I think they could give you 20 million bucks, and you don't have to show it."

An unnamed "Washington Democratic lawyer-lobbyist": "There's nothing to stop me from putting a million dollars into a (presidential) campaign . . ."

Lee Atwater, Reagan's deputy assistant for political affairs: "I think the story of this (1982) off-year election is that we've marshalled our resources and bought one or two Senate seats and 15 to 20 House seats."

Robert Perkins, who was the Republican National Committee's finance chief in 1977-1978, and whose soft-money drive in 1980 raised $9 million: "We picked out the states that needed the money, identified money from major contributors, and funnelled it into the states. This was outside any federal limits . . ."

Lyn Nofziger, the former longtime Reagan aide: "In a state where it's allowed, you get corporate money (i.e., stockholders' money) and spend it for damn near anything. And if I give you $50,000 in corporate funds in California, that frees the campaign to spend $50,000 for whatever it wants."

Rep. Tony Coelho, chairman of the Democratic Congressional Campaign Committee, who established a special club for big investors, a.k.a. generous givers, on what they get in return: "Access. Access. . . . They meet with the leadership and with the chairmen of the committees. We don't sell legislation; we sell the opportunity to be heard."

Sen. Robert Dole, indirectly answering Coelho: "There aren't any Poor PACs or Nutrition PACs or Medicare PACs" (neither, it may be added, are there any Victims of Smoking PACs, or Victims of Defective-Brakes PACs, or Victims of Fraudulent Pharmaceutical Testing PACs, many such victims having had readier access to cemeteries than to fund-raisers on Capitol Hill).

Rep. Guy Vander Jagt, chairman of the National Republican Congressional Committee: "In 1975, I spent most of the year trying to get businesses and industries to establish PACs."

Former represenative Henry Reuss: "The corruption and the evil (lie) in the preoccupation of legislators, many of them very fine men and women, who have to spend a large part of their lives panhandling, going around to all of these groups saying, 'I would just love to have a check from you.' "

Over many decades, tbe relationships between money and politics have been explored in scholarly books (by Alexander Heard, Herbert Alexander, and George Thayer among others); in analyses by public interest organizations (such as Public Citizen's Watch), and in many newspapers by numerous reporters (two pioneers were the late Jerry Landauer and James Polk). That Drew's magazine articles did not recognize this work, much of which was extremely difficult, and which she relied upon, is a nit; that her book nowhere recognizes this previous work--not in the acknowledgements, and not in notes or a bibliography, either of which could have easibly been added--is regrettable.

Some caveats: Perhaps for the sake of brevity, Drew tells too little about some crucial issues, such as the cosmeticized coercion used by some PACs to raise money, and the ways in which presidents have abused their power to reward and punish investor/givers. I wish she had not ignored Judge J. Skelly Wright's bold, incisive condemnation of the "tragically misguided" Supreme Court decisions that gave "protection to the polluting effect of money in election campaigns." In Buckley v. Valeoand First National Bank v. Bellotti, Wright said the Supreme Court violated its own First Amendment precedents, creating "an artificial opposition between liberty and equality" and mocking the principle of "one man, one vote."

Drew's final sentences are these: "We have allowed the basic idea of our democratic process--representative government--to slip away. The only question is whether we are serious about trying to retrieve it." But one must ask whether the slippage is irretrievable. She is surely right to urge public financing of congressional contests, but she is also right to be cautious in doing so. The dismal experience with public financing of the 1980 presidential campaign, if nothing else, teaches us never to underestimate the power of money and the cunning of loophole-finders.