Back when Ronald Reagan was trying to make a case that the Nicaraguan Sandinistas were worse than bad, he linked them to what he must think is the ultimate evil -- not Marxism, not communism, not Cuba, not even the Soviet Union. No, the president said the Sandinistas had ties to the PLO. Worse than that you cannot get.

Indisputably, the Sandinistas do have ties with the PLO. But the president's statement said more about his inability to distinguish between Arab moderates and Arab radicals, to accept the Arab world on its own terms, than it did about the PLO. Most Third World regimes, and even some European ones, have ties to the PLO. In many parts of the world, we are the odd man out.

Now, though, the president's rhetoric about the Arab world in general, and its leftist regimes or organization in particular, has come back to haunt him. As he has with the PLO, the president has simplified Middle East politics, telescoping the center into the hard left -- holding leaders accountable to an American, not Arab, standard. The language has taken its toll. Now the Senate, too, lacks the patience to distinguish between Arab moderates and radicals. As a result, it has refused to sell arms to Saudi Arabia.

By a 73 to 22 vote, the GOP-controlled Senate told Saudi Arabia we don't need its oil anymore, we don't find it particularly helpful to our friend and ally, Israel, and we don't mind saying so. Of course, some senators had more than global considerations in mind with their vote: in an election year, it can't hurt to take a swing at the Arabs.

Eventually, the administration will probably get something of its original Saudi arms package -- although it has already dropped its request for 200 Stinger missiles. But the damage has been done. During the course of the Reagan administration, the United States has shifted from being only a protector of Israel to something of a Middle East belligerent -- which is no favor to Israel.

The administration only now seems conscious of this. Now it lauds the Saudis for playing a behind-the-scenes role in the (mostly) nonexistent Middle East peace process and says that by deeds, not words, they have earned their weapons. But by both action and words, the administration has shown Congress how to treat Arab moderates as if they were radicals, to expect denunciations of anti-Israel terrorism, to assume that moderate Arabs, with a shrug of resignation, will do the "reasonable" thing and recognize Israel. If you're waiting for the Saudis to denounce PLO terrorism you might as well ask them also to buy Israeli bonds.

The PLO itself is discussed as if it existed only in an American context. It is hard to say anything good about it, but in the Middle East it is seen neither as a simple terrorist organization nor as being particularly radical. The Syrians, in fact, fault it both for its moderation and for Yasser Arafat's occasional flirtation with language that would acknowledge that between Jordan and the sea is a place called Israel.

The administration has applied the same sort of American ethnocentrism to Egypt. When the hijackers of the Achille Lauro were being flown out of that country, the United States forced the plane to land in Italy. Fine. But what followed was an official chest-thumping of the kind not heard since Tarzan movies. The administration gloated over what it had done, suggested Egypt had caved in to terrorism and seemingly forgot that the last leader of that country, Anwar Sadat, was killed for the crime of moderation.

As a single incident, the Senate's rejection of the Saudi arms sale is not all that important. The House of Saud can shop elsewhere. But the administration ought to appreciate the Senate action for what it was -- an expression of neo-isolationism, a flight from the realities and complexities of Middle East politics and a reflection of the sentiment the administration itself generated. The Great Communicator had communicated -- and the Senate got the message.