The argument over American food aid to drought-stricken African nations, suddenly a heated domestic political issue, is rooted in the administration of Public Law 480, the basic tool for sending U.S. food to the needy overseas.

Reports of intensifying famine in the sub-Saharan drought belt have pushed the food-aid issue into the presidential campaign. Democrats and others charge that the Reagan administration has not done enough; the administration responds that it is doing all that it can.

Under P.L. 480, known popularly as Food for Peace, U.S. spending this fiscal year is expected to reach $1.9 billion. At least $45 million of that is earmarked for Ethiopia, where hunger and suffering are acute, and $60 million in direct food donations is earmarked for Africa.

This year's Food for Peace expenditures will be the highest since 1972, making it one of the few programs that has grown in real terms under the budget-conscious Reagan administration.

When Reagan came to office in 1981, the United States was spending $1.7 billion on Food for Peace, about half in gifts of food and the other half in long-term credit for food sales to needy nations. This year, $1.1 billion will be in long-term credits and roughly $710 million in gifts, according to the Department of Agriculture.

As concerns grew earlier about the spreading drought in Africa, Congress directed the administration to spend an additional $150 million this year and next on direct food aid to the several dozen poor, afflicted nations in the sub-Saharan belt across the continent.

The debate is sparked by charges that the administration has moved slowly in aiding Ethiopia because of its government's close ties to the Soviet Union. Administration officials have added to the mix by criticizing Ethiopia for not moving with more alacrity in dealing with the problem.

Not that politics in P.L. 480 is so unusual. The program was born out of politics 30 years ago, at a time of enormous U.S. farm surpluses that could not be sold in this country. Behind the humanitarian glow of P.L. 480, many observers agree, was a political-commercial need to move grain to overseas markets.

And from time to time, P.L. 480 has been acknowledged as an arm in the U.S. foreign policy arsenal. During the Vietnam war years, for example, large amounts of P.L. 480 assistance were used to aid the Saigon government.

P.L. 480 works two ways. Under Titles I and III, the United States gives needy nations long-term credit at attractive rates to purchase American farm products. A key goal behind this program is that such sales will open the door to future markets as developing countries' economies grow. Japan and South Korea, now major buyers of U.S. goods, are the most notable "graduates" of P.L. 480.

Under Title II, the United States makes direct gifts of food and food products to qualifying countries. The program is operated by the USDA and the Agency for International Development, and generally administered by voluntary agencies such as CARE and Catholic Relief Services. Another portion of Title II food goes to the World Food Program, which oversees an emergency food reserve.

Last year, Title II sent 2.2 million tons of food abroad at a cost of $500 million, plus $200 million for transportation. Since it began, the USDA says, Title II food -- mostly grains and vegetable oils -- has gone to about 62 million people in 80 countries. The program has distributed 59 million tons of food valued at $10.1 billion.