POLITICS 88 : Gephardt Seeks to Justify His Trade Policy : Challenging ‘Old Order,’ He Says in Michigan on Eve of State’s Caucuses

Battling to keep his beleaguered presidential candidacy alive, Democratic Rep. Richard A. Gephardt Thursday delivered his broadest justification yet for the controversial proposal to toughen U.S. trade policy, which has been the cornerstone of his drive for the White House.

In a speech to the Detroit Economic Club just two days before the Michigan Democratic caucuses, Gephardt depicted himself as challenging the “old order” of economic beliefs in the best tradition of his party.

“The old order never passes easily,” he said. “Neither do the beliefs that explain or excuse it.”

Trailing in Michigan

Gephardt spoke here amid growing speculation about the future of his candidacy. Sources close to the campaign said he would probably not continue as an active candidate unless he finished ahead of Massachusetts Gov. Michael S. Dukakis in the contest for Michigan’s 138 convention delegates. Gephardt trails both Dukakis and the Rev. Jesse Jackson in polls here.

Success here is considered essential for Gephardt because the damage done to the auto industry, the mainstay of the state’s economy, has made the political environment particularly favorable for his trade policy, which would give the President new power to retaliate against unfair trading practices.

Gephardt recalled the resistance met by President Franklin D. Roosevelt when he “transgressed the prevailing economic faith and invented a New Deal to fit new realities.”

“That is the historic purpose of the Democratic Party and, in 1988, it is once more the central Democratic challenge,” Gephardt said.

Seeks Access to Markets

At the heart of the challenge, Gephardt maintained, is his effort to bolster U.S. competitiveness in the world and “to improve access to the international marketplace.”

Aides to the candidate said the Economic Club speech was intended to lay the substantive groundwork for Gephardt to continue his campaign after Michigan. But they said also that the speech could serve as a sort of valedictory if, as one put it, “his candidacy falters here.”

One concluding passage of the speech sounded that sort of note.

“My campaign has had its successes and its setbacks,” Gephardt declared. “But, at heart, our greatest victory has been to call the Democratic Party back to its essential role as an agent of fundamental change.”

Regardless of the outcome here Saturday, Gephardt is expected to file next week for reelection to the House of Representatives from the St. Louis district he has represented for 12 years. The congressional primary in Missouri will not be held until next August, giving him plenty of time to evaluate his presidential bid while retaining the option of another congressional campaign.

Gephardt’s aides cited the 1976 presidential campaign of Arizona Rep. Morris K. Udall as a precedent for proceeding with both congressional and presidential campaigns simultaneously.

Udall, who was swamped by Jimmy Carter in the Democratic primaries, nevertheless went to the convention as an active candidate and filed for reelection to the House at the same time.

The business and civic leaders who made up Gephardt’s audience here Thursday are just the sort who have provided much of the opposition to his tougher approach to trade, and Gephardt sought to soften their objections by analyzing the resistance to his approach.

Cultural Differences Cited

American opinion makers do not recognize “the profound cultural, legal and political differences” between the United States and its trading partners, he said.

In the United States, foreign companies and countries are free to hire lobbyists and lawyers to oppose changes in U.S. trade policy. On the other hand, he said: “An American lobby would be inconceivable in Korea or Japan.”

Another inequity that Gephardt asserted is poorly understood is the so-called “most favored nation” provision of the international trade system.

Under that principle, the United States grants Korea and Brazil the same favorable tariff levels that it applies to Great Britain and France.

“Each of them also grants us most favored nation status, which in the case of countries like Korea offers a meaningless appearance of fairness,” Gephardt said. “The problem is, since they treat all nations poorly, they treat us poorly. And, since we treat all nations well, we treat them well.”

‘Incentive for Reciprocity’

Gephardt asserted that, “without any incentive for reciprocity,” which he said was the objective of his trade proposal, “many of our trading partners are using our outdated assumptions to take advantage of us.”

After noting that Dukakis had shifted his position on trade during the Michigan campaign by endorsing a Senate proposal to combat unfair trade practices, Gephardt said: “I welcome conversion, but I would remind them we need more than a political tactic, we need a real policy commitment.”