ON WEDNESDAY, George Shultz told critics of his new "Project Democracy" not to be afraid of "holding up that torch." On Thursday, we learned that the secretary of state's colleagues in the Justice Department have decided to protect us from Canadian anti-nuke films they considered "propoganda." Is the Reagan administration as confident about "democracy" as it claims?

As a matter of fact, even before "Project Democracy" begins, the United States Information Agency has been giving money to some people who have trouble with the word.

In Fiscal Year 1982-1983, the USIA gave:

* $192,145 to Ernest Lefever's Ethics and Public Center, in order to promote the views of pro-administration journalists and academics on the European nuclear front.

When Lefever was trying (unsuccessfully) to persuade the Senate to confirm him as assistant secretary for human rights in June 1981, he insisted that "no, no, our center has never received a penny from the Federal Government." Of the $192,145 USIA granted to his center in 1982, Lefever has reserved $41,530 for overhead and salaries for his staff. The rest will go for seminars involving right- wing Americans and conservative Europeans. Speakers are to be paid $1,000, according to the grant agreement. Lefever proposes a list of speakers all of whom come from the right- hand end of the spectrum.

The "grant agreement" says that the European "peace movement" is "inflamed by the media and has had the direct and indirect support of the Soviet-controlled World Peace Council." It proposes that the USIA grant pay for meetings with a range of Europeans, starting from the extreme right and moving rightwards.

Lefever's describes his financing plan with modesty:

"Our detailed budget is realistic, but does not take into account the inflation that may occur before September 1983. The one place it could cut or reduced is item 7, the simultaneous interpreter services, if these services could be provided gratis by the U.S. government."

In other words, the only way to make a saving on a U.S.-subsidized project is to take money out of another U.S.-subsidized column.

* $162,810 to the Mid-America Committee to bring 14 official press spokesmen from right-wing Latin American regimes to Washington.

The Mid-American Committee (a rather obscure businessman's lobby dealing with the southern hemisphere) wants to teach these spokesmen how to manipulate the American media -- a cause the USIA seems to endorse.

Your tax dollars have already provided hospitality for Carlos Infante, Gen. Pinochet's international press director; Guy Mayer, the Haitian director of information; Pablo Nuila, the chief of Army Information in Guatemala, and 11 others.

The American hosts were selected with equal impartiality, ranging from John McLaughlin of the National Review to M. Stanton Evans and Patrick Buchanan. Thus was vindicated the promise of the $169,810 "grant agreement" which mentions the diversity of the American press and stresses that:

"The understanding of these differences is essential if the attendees are to learn to handle the media to best advantage, i.e., not defensively but assertively."

* $59,155 to the Center for Education and Research in Free Enterprise, for the purpose of running seminars on "free enterprise and strategic management" for 25 young Guatemalans concerned about "the socialist threat."

* $50,305 to the National Strategy Information Center in order to send American "social democrats" to meetings of the Socialist International. The committee of social democrats includes retired Adm. Elmo Zumwalt, former Treasury Secretary William Simon as well as Midge Decter of Commentary and philosopher Sidney Hook.

* $428,927 to the Claremont Institute for the Study of Statemanship and Political Philosophy. The institute describes its program for bringing conservative young Europeans to the United States thus:

"They will be steeped in the American political and cultural tradition. They will read speeches and essays by: James Madison, Alexander Hamilton, John Adams, Abraham Lincoln, Alfred Mahan, Theodore Roosevelt and Calvin Coolidge. . . . Not only will the participants have the opportunity of studying in America, but they will study America. And I believe that once they are led to discover its pith and grandeur, they will be deeply affected."

All this is taking place under the nominal rubric of the Fulbright-Hays Act of 1961. Some of the lucky recipients seem to realize this. The "grant agreement" between USIA and the National Strategy Information Center, for example, states that the responsibilities of the NSIC ands its "social democratic" envoys include:

"Stating in any announcement or publicity, where it is not inappropriate, that these activities are assisted financially by the Directorate for Educational and Cultural Affairs of the United States Information Agency under the authority of the Fulbright-Hays Act of 1961.

One wonders where it would be inappropriate.

The Fulbright-Hays Act forbids overtly political use of the exchange and cultural programs of USIA. In 1978 Congress also instructed that the director of USIA "shall insure that the scholarly integrity and non- political nature of educational and cultural exchanges . . . are maintained."

All this ought to be of concern to Allen Weinstein, the Georgetown University professor who has been asked to make a proposal on how the democracy project's budget might best be spent. The Agency for International Development hasn't been as generous with Weinstein as the USIA was with some of those above; he got $300,000 for his six- month project.

Weinstein is thought to favor a system resembling the West German stifftung (foundation) model. In Germany political parties of all shades receive a state subsidy to promote democratic education. The irony here is that the German system originated in the sincere belief that it was Germans who needed to be taught democracy. No such modesty or self-knowledge can be traced in the pattern of USIA funding.