REAGAN ADMINISTRATION lawyers have been acting strangely again. Today's example is in the area of sex discrimination.

Title IX of the Education Amendments of 1972 forbids sex discrimination in any "program or activity" that receives federal education assistance. Grove City College, a small Pennsylvania school, refused in 1976 to sign assurances that it would comply, and then went to court to protect itself when the Carter administration threatened to cut off funds. The Supreme Court faces two issues in interpreting the fuzzy congressional language. First, Grove City believes that Title IX doesn't apply to it because it receives no direct federal funds, only indirect money through federal student aid programs. Federal money for research or construction would be a different matter, the college argues.

The realities of college finances suggest otherwise. Federal student aid is important to the institution because the alternatives are using college funds or serving only rich kids. Furthermore, since money is fungible, assistance of any kind should make all of the institution's activities subject to antidiscrimination laws. This shades into the second issue before the court: whether to construe broadly the "program or activity" language so that it covers an institution's total program and provides the maximum leverage against discrimination.

The administration is taking the middle ground in a Supreme Court brief, arguing that Title IX does in fact apply to indirect funding such as student assistance, but that the prohibition on discrimination then covers only that specific program: in this case, Grove City's financial aid system. If another school gets money only to support its arts program, the administration's theory would require nondiscriminatory student participation in the arts, but not in financial aid, admissions, housing, athletics and so forth. As congressional and other critics have said, that's an unduly narrow and hair-splitting reading of the statute. It ignores the legislative history and the practical demands of civil rights enforcement. The point of the statute is to end sex discrimination in education.

Who in the world is the Justice Department trying to please? It is undermining the president's claim that additional enforcement muscle from the Equal Rights Amendment is unnecessary. It is sabotaging the president's multi-front summer campaign to mollify critics. In fact, Justice has further inflamed the civil rights establishment (if that's possible) because comparably narrow statutory constructions would gut all antidiscrimination laws covering federal grant recipients. Justice's middle position also seems to upset critics on the right, who want government to wither in every quarter and perhaps especially in this one.

The president was informed of the Justice Department's position, but the brief wasn't reviewed because "it's being handled as a legal matter," according to reports. Well, if attorneys at Justice argued that the law is clearly on their side with no room for policy and political considerations, they were either incompetent or, put charitably, less than candid. If White House staff members believed them, they were foolish. Lower courts are divided, but the weight of legislative history supports broad enforcement authority for Title IX and related statutes. Several of the president's friends in Congress agree, including Senate Finance Committee Chairman Robert Dole and House minority leader Robert Michel. Rep. Claudine Schneider's resolution backing a broad reading of Title IX has 226 cosponsors from across the political spectrum, and was unanimously reported out of committee the other day. The administration's position makes no sense, as policy or politics.