VENICE -- Other than abrupt cancellation of the Iran-contra hearings, nothing would please President Reagan more than an overwhelming victory for the Conservatives in the British elections Thursday.

The president considers himself a friend and ideological soul mate of British Prime Minister Margaret Thatcher, whom he is to meet here Tuesday for perhaps the last time on European soil. He is also her fan. Reagan is rooting hard for a Thatcher victory and allowed himself to become a campaign issue in the British election by casually denouncing "grievous errors" of the Labor Party's antinuclear defense policies in a presummit interview.

Thatcher's political success has been an inspiration to Reagan. She embodies his cherished conviction that free-market policies inevitably must triumph over socialism. She provides bases for U.S. bombers to strike Libya and arguments more persuasive than Reagan's for deploying his "Star Wars" missile defense system. If Reagan stumbles at a shared international photo opportunity, he knows he can count on "Maggie" to bail him out.

But Reagan pays a stiff price in reputation for the inspiration and assistance he receives from Thatcher. The prime minister outshines the president in intellect and tough-mindedness and makes no effort to conceal these advantages from American reporters or British voters. There have been summits when Thatcher finished Reagan's lines for him and other summits when she gently dragged him to a waiting limousine before he created an international incident by saying whatever came into his head.

Thatcher reinforces Reagan while also patronizing him. When the two leaders share a world stage, their constituents instantly recognize that Thatcher is both the superior intellect and the more elemental force. The disparity in their capacities may bolster British national pride, but it uncomfortably reminds Americans that they are led by a president who is in serious trouble when he departs from his script.

Early in the decade, Thatcher's edge was not so apparent. When the two leaders attended their first economic summit in 1981, many conservatives thought Reagan might prove the more effective leader. Despite the knowledge gap, Reagan then seemed to have a clearer sense of where he wanted to take his country. Because of economic differences between the two nations and because the welfare state is less embedded in America, the United States responded more quickly than Britain to the "free market" remedies of tax cuts and tight money that accepted recession and unemployment as necessary costs of the effort to squeeze inflation and reduce interest rates.

Reagan had succeeded as a second-term governor of California and a first-term president largely by ignoring his approval ratings and advancing his agenda. But his aura of leadership was sacrificed in a 1984 election campaign in which he deliberately gave up his more controversial priorities to maintain his popularity.

Starting with this second-term campaign, Reagan demonstrated that he was no longer willing to run the risks of an unpopular agenda, with the conspicuous exception of aiding the Nicaraguan contras. Reagan had warned Americans many times that encouraging terrorists by paying them ransom for captives was dangerous policy. He showed himself to be simultaneously softhearted and softheaded when he abandoned this policy in his secret trade of U.S. arms for American hostages.

Whatever the result of the British elections, Thatcher has shown that she is made of sterner stuff. In the twilight of his presidency, Reagan draws attention to poll findings that Americans still like him even though they no longer trust his leadership. Thatcher seems to revel in the opposite finding, drawing comfort from the fact that she is more respected than liked.

Even after the Iran-contra deal, there are more Americans fond of Reagan than British voters who feel similarly about Thatcher. Both leaders are being judged by their standards. Thatcher has decided that her policies count for more than popularity. Reagan prefers to be liked.

Revelation of the Week: Last week, the best "Reaganism" was expressed by the president's national security adviser, Frank C. Carlucci, who said, "It's important not to measure a hostage policy by the number of people released."