Trade Seen as Less of Issue as Voters Reject Hard Line

The failure of Rep. Richard A. Gephardt to make a strong showing in the Super Tuesday primaries and caucuses means that trade may have fizzled as a potent campaign issue this year and that the hotly debated trade bill Congress finally enacts will be moderate, key lawmakers and strategists said Wednesday.

Conventional wisdom among political analysts was that if the Missouri congressman, who had made the U.S. trade deficit the centerpiece of his campaign, had scored a landslide victory, lawmakers would have felt compelled to take a tougher stand on the issue and pass stringent legislation to crack down on alleged unfair trade practices by other nations.

The omnibus trade bill that Congress is considering is loaded with such protectionist features, which Reagan Administration officials view as excessive. Versions of the legislation have been passed by both Houses and are being considered by a series of House-Senate conference committees, with a final congressional vote expected next month.

But political analysts say that Gephardt’s overall fourth-place finish in the Super Tuesday states significantly eases those pressures and may well have punctured the protectionist issue in the 1988 presidential campaign. The inability of Sen. Bob Dole of Kansas, also an advocate of some tough trade measures, to win in Republican primaries in key textile-producing states underscores the issue’s decline.

As of now, the protectionist blame-the-foreigners approach “doesn’t work,” said Greg Schneiders, a Washington-based Democratic pollster who was a White House official in the Administration of former President Jimmy Carter.

“Trade is just a non-issue,” said Claude Gingrich, a GOP consultant and former Reagan Administration trade specialist. Referring to Gephardt’s successful trade-fueled campaign in last month’s Iowa caucuses, he said: “It seems to me that the big blip that everybody saw on the radar screen in Iowa has just disappeared.”

Focus on General Concerns

As a result, other Democratic candidates who have been stressing an improved educational system and methods of making U.S. industry more competitive will feel little pressure to embrace tougher punitive restrictions, analysts said. Instead, they can focus on voters’ general concerns about economic issues, such as what the United States can do domestically to hold its own in the global economy.

Rep. Sam Gibbons (D-Fla.), chairman of the House Ways and Means trade subcommittee, said that the Gephardt setback “pretty well guarantees” that the final version of the trade bill will be diluted. A controversial provision sponsored by Gephardt himself--to impose penalty tariffs on other countries that amass huge trade surpluses with the United States--will be “that much easier to drop,” Gibbons asserted.

Serious bargaining on the bill is expected to begin Monday when the Senate returns from its one-week vacation. Now, while Congress still is certain to send a trade bill to the President’s desk this spring, it is more likely to be one that Reagan will sign and that U.S. allies can live with, both Democratic and Republican strategists agreed.

Believe Tide Already Turned

Indeed, most congressional analysts believe that the protectionist tide on the trade bill turned several weeks ago and that the legislation would have been softened even if Gephardt had done better in the Super Tuesday contests.

“The only difference is that we would have had to come up with some sort of face-saver for him; now we don’t have to,” one Democratic congressional staff member said.

House Ways and Means Committee Chairman Dan Rostenkowski (D-Ill.) already has scrapped some of the provisions that most troubled the Administration, which contended that they would incite retaliation from the nation’s trading partners. Wednesday, committee conferees began softening some of the other sections of the 1,100-page bill.

Analysts expect the bill that finally emerges to be less aggressive in making mandatory trade sanctions that are now left to the President’s discretion. Some conference committee members also believe that they will scrap controversial provisions requiring foreign investors to provide advance notice when they move to acquire American companies.

The changed political climate on trade is expected to make it easier for congressional Republicans to support President Reagan on key votes on the trade bill. Before, Republican lawmakers had been under heavy pressure to go along with tough provisions.

‘Export-Oriented Measure’

“This is going to be a much more export-oriented measure rather than a punitive bill,” a House strategist said.

To be sure, Administration officials caution that the measure still contains about 15 provisions that the White House views as potential stumbling-blocks. But U.S. Trade Representative Clayton K. Yeutter, who earlier this month led the Administration’s most vocal attack on the Gephardt strategy, said he is optimistic. “We hope the Super Tuesday results will encourage lawmakers to begin jettisoning some of these provisions,” he said.

Both Gephardt and Dole have leaned heavily on the trade issue during their campaigns. Gephardt has charged that the Administration has failed to take a tough enough stance on trade disputes, and he has singled out countries such as South Korea for imposing barriers to imports from the United States.

Airs Controversial Commercial

In one provocative television commercial, he showed a $10,000 Chrysler K-Car that he declared would cost $48,000 in South Korea because of trade restrictions and local taxes. Trade experts here have disputed that figure and noted that South Korea has been reducing its auto import tariffs steadily since 1986.

Dole’s failure to garner support in the Carolinas after supporting quotas on foreign textile imports also surprised some analysts. The Kansas senator conspicuously endorsed trade legislation that the industry is proposing, while his opponent, Vice President George Bush, publicly disdained the issue. Asked for his views of the textile industry’s import problems, Bush told one Carolina audience: “ C’est la vie “--French for “That’s life.”