It's easy to find fault with President Reagan's decision to offer compensation to the families of 290 victims killed when a Navy warship downed an Iranian airliner in the Persian Gulf.

After all, Iran bears much of the responsibility for that tragedy but won't admit it. The compensation likely won't moderate Iran's dangerous extremism much, if at all. The amount of money involved is, at this point, anybody's guess. It won't be easy to identify all the dead and locate their families.Once those families are located, plenty of questions will remain: Should the families receive a flat payment or should compensation be based on such factors as age, number of dependents, and the earning power of the deceased? How can the U.S. make sure the compensation reaches the intended recipients?

Moreover, shouldn't the White House have waited until an investigation into the incident was completed before deciding whether or not to push for compensation? And shouldn't, as many citizens are insisting, the U.S. insist that Iran release the Americans being held hostage in the Middle East before any compensation is provided?

After such points are taken into consideration, President Reagan still made a decision that is proper not just because it's humane but because it serves America's own best interests.

The more openly and expeditiously the U.S. admits it was part of a horrible mistake and moves to correct it as far as possible, the easier it will be to establish the difference between this episode and the Soviet destruction of a South Korean airliner in 1983.

Whatever the cost of the compensation may be, it likely will be small in comparison to the boost it can give to moderate and pro-American elements in the Middle East.

Why not insist on the release of American hostages before any compensation is paid? To begin with, that would amount to paying ransom, something the U.S. keeps insisting it won't do. Keep in mind, too, that it wasn't just Iranians who lost their lives when the airliner was shot down; so did the citizens of six other nations.

If Americans are looking for guidelines on how to deal with this situation, there are ample precedents. A maximum payment of $20,000 per person is set by the Warsaw Convention as the guideline for compensation in civilian crashes, and the U.S. might consider that limit in making specific offers. After Israel shot down a Libyan airliner that strayed over the Israeli-occupied Sinai Peninsula in 1973, Israel paid $30,000 to the families of each of the 106 people killed. Israel also paid reparations to the U.S. after a mistaken attack on the USS Liberty during the 1967 Arab-israeli war. Both Israeli payments were made without any admission of legal liability.

Though the commander of the U.S. Navy warship had reason to believe his vessel was under attack by the Iranian plane, it's reasonably clear at this point that a mistake was made. Now the U.S. should show how a great nation acts under such circumstances.

A great nation does not stall and bluster, try to hide the facts, or dream up excuses. Rather, a great nation lets the truth be known and tries to make amends. The U.S. has the moral strength to do just that - and the sooner Washington acts, the more pointedly it will remind the world of the basic decency of the American presence in the Persian Gulf.