So what does the Arab world think of Ronald Reagan?

"We have to think of whom we would like to defeat in order to publicly endorse" said Ambassador Clovis Maksoud of the League of Arab Slates. The setting was the Iraqi National Day party last night at the Washington Hilton given by the Iraqi Interests Section. Maksoud was among 500 guests welcomed by Raad H. Shihab, head of the Iraqi Interests section.

"Even the Soviets and the Chinese can be more outspoken," said Maksoud. "The Arab world is still taboo."

How it all ended up in Detroit the night before at the GOP convention provided much of the talk going on among the Arab world diplomats. The reports of former president Gerald Ford's conditions for accepting the vice presidential spot on the Reagan ticket sounded to some who had been watching late-night television like a "redefinition of the presidency," as one of them put it.

"But there is no such thing as a copresident," one of them said, obviously up on his U.S. Constitution.

Shihab, who arrived here 37 days ago from Baghdad, said watching American politics on television from Detroit gave him the opportunity to find out how things are run here. And what did he think of Ronald Reagan?

"He's old -- I think he's too old," Shilab, who is 29, said without hesitating.

Shihab held worry beads ("we call them prayer beads") while he received guests who included the ambassadors of Saudi Arabia, Czechoslovakia, Pakistan, Yemen and the charges d'affaires of Afghanistan, Algeria, Kuwait, as well as Assistant Secretary of State Harold Saunders and Deputy Assistant Morris Draper.

Shihab said his worry had nothing to do with politics but with his effort to quit smoking.

Iraq and the United States have had interest sections in each others' countries since 1967, the year of the Six-Day War. Since 1977 the U.S. has tried to reestablish diplomatic relations, but Iraq hasn't shown much interest. In nonpolitical areas, the two countries seem to be moving ahead, if slowly. There is increasing trade (Iraq is the second-largest oil-producing country in OPEC), and cultural exchanges are multiplying. Next month, for example, Iraq sends a historical fashion show to several U.S. cities.

Last night former D.C. councilman Douglas Moore was among the businessmen at the party hoping to make productive contacts with the Iraqis, and indeed, anybody else in the Arab world, with some money to spend.

Moore, who served in the council from 1974 to '78, said his firm, Moore Energy Resources, deals in coal and crude oil, and though Iraq doesn't sell much crude oil to the U.S., "I would hope to see that changed," said Moore, flashing a toothsome smile.

On the GOP convention, Moore, a Democrat, said that while a lot of people are "writing off" Ronald Reagan, he isn't. As for Jimmy Carter, Moore said, "He betrayed black folks. He got 90 percent of the black vote and only won the election by 2 percent. He owed the blacks a good deal, and the reward they got was unemployment."

Ambassador Maksoud said he was off to address the PUSH convention in New Orleans and the State Department's Harold Saunders wanted to know what he was going to say.

"I said what else would an Arab ambassador talk about? My function is to persuade the American people that the central issue in the Middle East is the rights of the Palestinian people, the rights of self-determination. I'm not going to be pushing," said Maksoud, "but we think the American people are persuadable."

Lavish buffet tables in three areas of the Crystal Ballroom provided Middle Eastern, as well as Western food. And alcoholic refreshments were plentiful, even though this is the Moslem holy month of Ramadan. "If somebody asks for a drink," said a member the Islamic faith attached to the Iraqi Interest section here, "you can't say no."