Stakes Are High for Clinton on Japan Strategy : Trade: Anger over Tokyo’s surpluses fuels President’s risky decision to reject accord. But he is vulnerable to attack in issues of foreign policy.

In refusing to sign what he said would be a cosmetic agreement with Japanese Prime Minister Morihiro Hosokawa, President Clinton has embarked on a potentially lucrative but nonetheless risky political course.

At first blush, a strategy of confronting Japan directly over trade issues--something Clinton advisers believe is good economic policy--might also seem to be almost risk-free politically because of widespread anger, particularly in key Democratic constituencies, over Japanese trade surpluses.

Indeed, White House officials seemed at times this week almost eager for a confrontation and worried that the Japanese might offer just enough to force Clinton to accept an agreement that would be difficult to sell at home.

But for the President, almost no foreign policy issue comes risk-free--a reality of which his advisers have become acutely aware over the last year. Because a large segment of the public remains uncertain about Clinton’s ability to handle foreign policy, he is almost always vulnerable to attack on the subject, his aides fear.

Initial congressional responses to Clinton’s move were positive, including a statement by Senate Minority Leader Bob Dole (R-Kan.). Nonetheless, White House advisers worried that over the next few weeks Clinton will be attacked by at least some Republicans for letting trade disputes jeopardize the U.S.-Japanese security relationship.

That criticism could bite particularly hard if the war of nerves over North Korea’s nuclear program continues to escalate. Already, several former George Bush Administration officials have taken Clinton to task for stressing economics too heavily at the expense of security concerns.

At the same time, Clinton will face strong pressure in Congress to prove that he is willing to back up his tough talk about forcing open Japanese markets now that trade diplomacy has failed. Within hours of the end of Clinton’s news conference with Hosokawa, leading Democratic trade hawks, such as Sen. Carl Levin of Michigan, were urging the White House to impose strong new trade sanctions against the Japanese.

“The only way to pry open Japan’s markets after decades of jawboning is to place equivalent restrictions on their goods,” Levin said.

The need to thread a path between those two potential criticisms shaped Clinton’s words Friday. The President “had to speak to several audiences today,” a senior aide said, noting that Clinton wanted to strike a tough note while still not embarrassing Hosokawa, whom Administration officials continue to view as a genuine reformer. “We didn’t want to shove a stick in his eye,” the aide said.

Moreover, the aide said, Clinton wants to “cogitate a little bit” over what steps to take next before precipitously plunging into a potentially costly trade war with the Japanese. Nonetheless, over the next couple of weeks, Clinton will have to back up his words or face the political charge of being “empty,” the official conceded.

As a practical matter, Clinton probably has about 10 days before he has to act because Congress left town Friday for a weeklong recess. White House aides signaled Friday that they expect to have a package of sanctions ready for Clinton to announce when Congress returns.

If Clinton sticks to that timetable, White House strategists said they believe that he could reap substantial benefits. As Clinton said at his news conference--in response to a Japanese reporter who asked about the unpopularity in Japan of American insistence on numerical measurements of progress in trade--”America’s trade deficit with Japan is not very popular among the American people or the American government.”

Indeed, polls taken during the last election indicated that the failure of Republican administrations to end the trade deficit with Japan was one of the strongest grievances that prompted many so-called Reagan Democrats to abandon the GOP in 1992.