President Sees ‘Doomsday’ in Trade Overhaul Measure

With members of the House and Senate trying to put finishing touches on a 1,000-page bill overhauling the nation’s trade laws, President Reagan attacked the bill again Monday and warned that the effort “could squelch productivity, destroy American competitiveness and make . . . doomsday myths a reality.”

Although some of the provisions to which Reagan most objected have been removed, the President picked apart the legislation as it was originally written and said: “I’ll veto if I must. Only wholesale elimination of the objectionable provisions will produce a bill I can sign.”

Speaks at Aluminum Firm

Reagan’s aides chose as a platform for the President’s remarks the corporate headquarters of a giant aluminum producer that has been thriving, to some extent as the result of the sort of international trade that the White House contends would be curtailed if the more protectionist aspects of the pending measure are enacted.

Using the cheering employees of the Reynolds Metals Co. in Richmond to drive home his message, Reagan took issue with provisions requiring a President to carry out what he called “mandatory retaliation or automatic protection” to counter foreign sales that run up major trade imbalances unfavorable to the United States.

“If enacted, they could weaken the international trading system and could require the President to start trade wars. It’s a bad proposal under any circumstances. But it’s particularly bad now that American exports are soaring and American manufacturers are exporting as never before, so are vulnerable to retaliation as never before,” Reagan said.

Indeed, the troublesome U.S. trade deficit, which measures the dollar values of imports and exports and the flow of dollars out of the country, recently has been falling after peaking in October. The decline is attributable to new strength in American exports rather than a curbed U.S. appetite for foreign-made goods. In January, the latest month for which figures are available, the trade deficit was $12.2 billion.

Although he mentioned neither Republicans nor Democrats, Reagan said that some lawmakers, “in an apparent attempt to import Euro-malaise,” have placed in the trade measure “European-style regulations that would create America’s first national rules restricting a company’s right to close down facilities and relocate operations.”

As Reagan began his speech, 100 miles away in Washington Rep. Richard A. Gephardt of Missouri, who had made protection against foreign imports a centerpiece of his campaign for the Democratic presidential nomination, was ending his candidacy.

Cites Great Depression

Reagan, who has frequently tied the onset of the Great Depression to limits on international trade, made no mention of Gephardt, but he said: “Protectionism isn’t just bad economics--it’s bad politics. I think the American people have decided that one Great Depression is enough and they aren’t going to give the trade demagogues a second chance.”

Gephardt had sponsored an amendment to the trade bill that would force the United States to retaliate against nations that run up large trade surpluses with the United States. The provision has been eliminated, however, by Senate negotiators working with members of the House to reconcile differences in the trade measures produced by the two chambers.