Kennedy Seeks Business Support : Politics: The influential senator has been assigned a crucial role in the Democratic Party’s efforts to regain the White House. His strategy is unfolding.

When Sen. Edward M. Kennedy had lunch here earlier this week, the company he chose was not the sort that most people would expect for the Senate’s most forceful liberal voice.

Instead of union leaders or civil rights advocates, the Massachusetts Democrat’s companions in the back room of Freestones restaurant were the bosses of a dozen or so of New Bedford’s biggest companies. For an hour, over fish chowder and Oriental turkey salad, they discussed the credit crunch, the burden of government regulation and ways to ease the pain of the recession in this factory and fishing town where unemployment has soared above 17%.

This businessman’s lunch was no whim. Rather it was part of Kennedy’s still unfolding strategy to build bridges to the business community, not only in his own state but also around the country, in hopes of getting badly needed support for his ambitious agenda of social welfare legislation.

Although Kennedy has tried to adjust his tactics to the austere fiscal realities of the 1990s, the broad goals he has set for himself and for his party remain much the same as they were in the ‘60s, ‘70s and ‘80s.

In words that still ring in the hearts of his admirers, Kennedy defined those goals at the 1980 Democratic convention. Concluding his unsuccessful presidential candidacy but renewing his party’s commitment to the cause of “the common man--and the common woman,” Kennedy declared: “For all those whose cares have been our concern, the work goes on, the cause endures, the hope still lives, and the dream shall never die.”

Though Kennedy, now 59, has written himself out of the Democratic script for the presidency in 1992 and perhaps for all time, he continues to pursue that dream. Circumstances and his own convictions and determination have combined to assign him a crucial role in the party’s effort to overcome the immense obstacles it now faces if it is to regain the White House next year.

With President Bush riding a surge of post-Desert Storm popularity, Democrats acknowledge that they have only one chance of defeating him--by forging a platform of domestic policies that will portray them as champions of the average middle class citizen against the forces of wealth and privilege, which they contend dominate the opposition party.

If such a political blueprint is to take shape, much of it will have to emerge from the Senate Labor and Human Resources Committee, which is chaired by Kennedy. In a three-page memorandum to the Senate leadership last January, Kennedy sketched a series of proposals in such areas as family leave, job training, education reform, health insurance and child care, which Kennedy said “are directed toward key needs of hard-pressed American families struggling in the face of a deepening recession.”

Kennedy minces no words about the urgency for Democrats to confront such issues. “Democrats have to identify with the kinds of needs the average family has,” he told a New Bedford television interviewer, adding: “If we are able to identify in those areas in a constructive and positive way, I think Democrats can be very successful. And if we don’t, we don’t deserve to win. It’s as simple as that.”

But carrying out this mission, in an era of severe budgetary limits on government spending and activism is by no means simple, as Kennedy realizes, which explains his effort to gain friends and support in the business community.

One tactic is to justify social goals in economic terms. At the lunch at Freestones, the senator cited an estimate that the overall lifetime cost of treating a person whose health was impaired as an infant because of inadequate care could run as high as $400,000. “You could run a whole well-baby clinic here in New Bedford for that,” he told the business leaders.

During the discussion, the senator had expressed concern that, in the wake of the savings and loan scandal, some federal regulators were overcompensating for past laxity by cracking down too hard on banks, thus making loans difficult to come by.

“We are obviously not interested in seeking the support of financial institutions that don’t deserve to continue to serve the public,” Kennedy said. “But we do recognize the importance of accessibility of credit.”

“This is the first time I’ve heard him speak of government bureaucracy in a way that acknowledged it’s a problem for business,” said Roland Martell, head of the local division of Borg-Warner Corp.

Nevertheless, old suspicions of Kennedy linger. “When I told my home office in Chicago that I was having lunch with Kennedy, they were scared to death,” Martell said.

Still, Kennedy and other Democrats believe that they can find common ground with business leaders on domestic policy.

Tennessee Sen. Jim Sasser, a moderate Democrat who chairs the Senate Budget Committee, pointed out that some businesses--particularly the automobile industry--are disturbed by the soaring costs of health insurance, which they have long provided to their own employees as a fringe benefit. This makes them more receptive, Sasser said, to some form of national health insurance, an idea for which Kennedy has fought for the better part of two decades.

Significantly, Kennedy last month chose a group of corporate officers and university presidents, the Committee on Economic Development, to unveil his strategy for dealing with domestic policy under the budget restraints adopted in the last Congress. After praising the committee for its report recommending the expenditure of $10 billion on early development of poor children, Kennedy described “a new kind of thinking about social programs in this country--what I call ‘public enterprise.’ ”

Sounding as cost-conscious as a Calvin Coolidge Republican, Kennedy declared: “We cannot afford to keep throwing money at problems. We need to apply the same rigorous standards that business uses in private enterprise.”

Contending that wasteful programs should be scrapped and efficient ones expanded, Kennedy asserted: “Any good business looks at that bottom line and so must the government.”

As the 102nd Congress gets down to business, Kennedy’s influence as a senator is widely accepted, even by his fiercest ideological foes. “He is somebody to be reckoned with,” says New Right activist Paul Weyrich. “He . . . pays attention and learns the issues.”

“Whether you agree with him or not he is a Senate power in his own right,” said Sen. Orrin G. Hatch (R-Utah).