IT IS IRONIC that a socialist state should dazzle us with the spoils of absolutism. Only a state in which the monarch counts for everything and the subject for nothing could amass the treasures which the German Democratic Republic is showing us in its magnificent exhibition "The Splendor of Dresden."

Absolutism was the specialty of Louis XIV, the "Sun King" of France. But in France there was only one court whose baroque sum warmed a whole nation. In 18th-century Germany, every petty potentate created a Versailles for himself, complete with opera, theater, ballet and harem. Each of them kept an army, with a general for every 300 men. And each of them tried to whip his subjects into artificial uniformity. The result, as historian Veit Valentin pointed out, could only be tragicomic.

Like Versailles, the gilded courts of the German absolute rulers were built outside the troublesome city. Schoenbrunn is outside Vienna; Charlottenburg outside Berlin; Nymphenburg outside Munich.

In Dresden (located on the waterway and trade route of the Elbe River, much closer to Prague than Berlin), a great fire simplified the enterprise. The court with its treasures and pleasures could be built in the center of the city to the benefit of both. There was increasing contact between courtiers and citizens. Dresden became one of the foremost art centers in Europe.

The moving spirit was Augustus the Strong, elector of Saxony and king of Poland, who lived from 1694 to 1733. An elector was a prince who belonged to the council that elected the emperor of the Holy Roman Empire (of German states). The Polish kingdom was bought. It proved to be a good investment for Dresden because, along with the nearby silver mines and heavy commerce on the Elbe River. Polish toil paid for the splendor now on exhibit at the National Gallery East Building. Augustus could brag that he found Dresden small and wooden and left it great, of stone and splendid.

Elsewhere, says historian Valentin German baroque courts drained the land not only of its riches but also of all intellectual impulses and gentility. "Everything that was intelligent and graceful was caught up into the circle of court life . . . To be the mistress of some courtier or perhaps the prince himself meant not only a life of ease, but influence, power and higher rank . . . To fall into disfavor with the prince usually spelled economic ruin . . . Court society became more and more distinct from the great mass of the German people. It represented a special, sharply defined sociological stratum, claiming for itself cultivation, polish, cosmopolitanism, knowledge of foreign lands and artistic taste."

That left the German people, except perhaps the leading classes of the great commercial cities, with a dull, oppressed life, excluded from politics and any participation in government. It took long years of self-education, says Valentin, to throw off this burden on the German mind and spirit and to quit the disastrous game of "follow the leader."

On the other hand, Germany's many baroque principalities left to the father-land more art collections and libraries, more parks and fountains, than are to be found in any other country of Europe. And this was Augustus the Strong's greatest strength. Among many other cultural coups, he launched the Dresden Picture Gallery with the purchase of 4,000 painting including Raphael's "Sistine Madonna."

Dresden's skyline was among the most delightful creations of German baroque, although many of the city's most delightful buildings were designed in the 19th century. Dresden's foremost architect was Gottfried Semper, who taught at the Dresden Academy and built the opera house, which like most everything else, was destroyed in World War II and is now being rebuilt.

Semper's Dresden career came to an abrupt end in 1849, when he quit building monuments and built barricades in the abortive democratic uprising. He fled to Paris with his friend and fellow revolutionary Richard Wagner, for whom he later built a theater in Munich. His most famous building in the Burgtheater in Vienna.

Wagner was but one of many famous musicians who made Dresden a city of sound as well as sight. Shortly after the Italians invented opera, Dresden's 17th century court musicians, led by composer Heinrich Schutz, performed the first one in German. Other composers who lived and worked in Dresden were Karl Maria von Weber and Robert Schumann. The Kreuzchor boy's choir, the Staatskapelle and the Dresden Philharmonic Orchestra enjoy international renown. Beginning this year, Dresden will hold an annual summer music festival.

In 1937, two years before Hitler's surprise attack on Poland, the Nazis ordered the Dresden museums to plan securing their treasures in case of war. The museums were officially closed and the art works stored in basements on Aug. 28, 1939, three days before the Nazi invasion of Poland that started World War II. At first, Dresden's treasures were stored in out-of-the-way castles and manor houses.

When the Soviet armies approached in 1945, the Nazis ordered all art treasures to be moved west of the Elbe River. On the way, the transport got caught in an Allied air raid, according to an East German press release put out in connection with the exhibition. Altogether, 197 valuable paintings, prints by Rembrandt and Caspar David Fridrich, and 10 containers of porcelain, antique furniture and the library of the Green Vault, one of Dresden's museums, were destroyed in this raid.

There were five devastating Allied air raids of Dresden, according to American accounts. The first was in the night of Feb. 13, 1945, with 800 British Royal Air Force aircraft. It was followed the next morning with 400 U.S. planes, the morning after that with 200 U.S. planes, and again with 400 planes on March 2. The final raid, with 572 U.S. Air Force planes was on April 17, a week before the Western and Soviet armies met on the Elbe.

The official reason given for the raids on Dresden was to assist the Soviet advance by destroying a communication center important to the German defense. The U.S. Strategic Bombing Survey established, however, that the raids achieved nothing to help the Red Army militarily but destroyed the greater part of one of the most beautiful cities in Europe, killing at least 35,000 people.

The Soviet Army occupied Dresden's ruins on May 8, 1945, and almost immediately moved the city's art treasures to the Soviet Union. According to East German officials, the move was supervised by a team of Soviet experts.In March 1955, the Soviets returned the art works and treasures, thereby squelching all suspicions that they regarded them as spoils of war and intended to keep them.

Today, Dresden is completely rebuilt and virtually all of its great historic buildings have been meticulously restored. The modern buildings are just as ugly as average modern buildings are everywhere else. The city is thriving with its new electronic data processing, camera, electric motor and X-ray machine industries, which export to some 90 countries.

The reconstructed buildings, museums and performing arts activities attract some 4 million visitors a year. August the Strong is helping the tourist trade.