PRESIDENT REAGAN chose the day before Veterans Day to announce that he supports the movement, already well under way in Congress, to elevate the Veterans Administration to a Cabinet-level department. He's embracing a bad idea that moves in exactly the wrong direction. The rationale is that veterans need a stronger voice in government. But the problem is that their voice is already too strong. At $27 billion a year the programs in their behalf are excessive, disproportionate to either need or just claims for past service. But the power of the veterans' groups is such that, as in this reorganization plan, the politicians just continue to give ground.

Plainly the society has special obligations to those who have risked and fought for it. The wounded or psychologically afflicted and their families must be cared for, as must the survivors of the dead. Returning veterans should be helped to get an education and buy a house -- to catch up with where they would have been without their tours of duty.

But the VA, in employees now larger than any federal department but defense, goes well beyond that. About two-fifths of the VA budget is for health care, mainly in the VA hospitals. But a lot of that care is for other than service-connected disabilities, and a lot of it also goes to people who could afford and be expected to pay. Most of the rest of the budget goes out in benefit checks. About a fourth of this money goes to veterans, not for service-connected reasons, but simply because they are poor. The government thus has one set of income support and health care programs for the general population, another and to some extent competing set for veterans, including veterans long since indistinguishable from other citizens.

The argument is made that if it were not for the veterans' programs the others would have to do more. Let them. Veterans who do not have service-connected problems are piggybacking on those who do. That is the heart of this duplicative system, which ends up channeling scarce dollars away from people most in need. The problem will only get worse as the large World War II generation of veterans reaches retirement age, when both their need and their eligibility for various forms of government help will increase.

The president in 1980 said that if elected he would abolish the departments of education and energy, both Carter constructs, as a symbol of his determination to reduce the size and reach of the federal government. We thought at the time he was right as to education, wrong as to energy. In reversing himself now, he is certainly wrong as to veterans. His own administration has recognized the excesses of the veterans' programs in budget proposals in the past. The step he now endorses, while it will ingratiate him with a broad constituency, promises further to distort the allocation of federal resources at a time when that can be least afforded. It shouldn't be don