TRADE INTERESTS READY FOR FIGHT IN U.S. CONGRESS U.S. lawmakers are gearing up for a showdown between protectionists and free traders as a major trade bill winds its way through committees to a vote by the full House of Representatives in late April. In a move to toughen U.S. enforcement of trade laws, a key House subcommittee last week approved a toned down version of legislation to require President Reagan to retaliate against foreign countries that follow unfair trade practices. This bill will be the cornerstone of congressional efforts to restore competitiveness of American industries and turn around last year's record 169 billion dlrs trade deficit. Several lawmakers have argued the new trade bill made too many concessions to Reagan and said they intend to back amendments to "get tough" with countries that violate trade agreements or keep out U.S. products. On the other hand, congressmen known for their allegiance to free trade, said the bill ties Reagan's hands too much in trade disputes and they will seek to restore his negotiating powers. Republican Bill Frenzel of Michigan said the subcommittee's bill was not one "that a free trader like me could endorse in all respects," but he emphasized there was a consensus among trade lawmakers to work toward a bill Reagan and Republicans would ultimately endorse. Frenzel said the goal of trade legislation was, "to make our trade policy stronger without violating our international trade agreements. You'll find a lot of people who think we have not done the former enough. You'll find poeple who think we haven't avoided violating agreements." In a key concession made at the urging of the powerful chairman of the House Ways and Means Committee, the trade subcommittee backed off a requirement that would have forced Reagan to automatically impose quotas or tariffs on imports from countries that engage in unfair trade practices. It also agreed he may waive any retaliation if it would hurt the U.S. economy. Ways and Means chairman Dan Rostenkowski, an Illinois Democrat, insisted the more moderate approach was necessary if the House wanted to pass a bill Reagan would sign into law. Reagan last year had blocked Senate consideration of a tough House trade bill he branded as protectionist and this year only reluctantly agreed to support a trade bill when he saw Democratic leaders were determined to pass a bill. As an indication of his success, White House spokesman Marlin Fitzwater told reporters Friday the administration still did not like some provisions. But he added, "Generally we feel very good about the bipartisan consideration of the trade legislation. I think we are progressing very well." The first battle will take place next week when the full House Ways and Means Committee considers an amendment by Rep. Richard Gephardt, a Missouri Democrat, to force countries such as Japan, South Korea and Taiwan to cut their trade surpluses with the United States. The subcommittee limited the Gephardt plan to provide only that the existence of a large trade surplus with the United States will trigger an investigation of unfair trade practices, but would not automatically set off retaliation. Rep. Phil Crane, an Illinois Republican and staunch free trader, said he will try to further weaken the Gephardt plan. Organized labor has pressed lawmakers for more relief from imports where jobs have been lost to foreign competition. AFL-CIO president Lane Kirkland this year angered the administration in a statement that any trade bill Reagan would sign would not be worth passage in Congress. But Rostenkowski set the tone of the trade debate in a statement, "I'm not trying to write legislation to please Lane Kirkland. I'm trying to write legislation that will be signed by the president." In writing the bill, the subcommittee rejected calls for trade relief for specific industries such as textiles. Rep. Ed Jenkins, a Democrat from Georgia, agreed to hold off his fight. He intends to push separately a bill to protect the domestic textile and shoe industry, an aide said. Reagan vetoed a similar measure last year. House Speaker Jim Wright, a Texas Democrat, is one of the most influential proponents of aid for specific industries beset by low priced foreign competition. Wright Thursday renewed his call for import relief for the domestic oil industry and announced his support for a Senate plan to trigger a temporary oil import tariff when imports reach half of domestic consumption. For the most part, the trade bill's provisions toughen U.S. enforcement of trade laws. The bill forces the administration to act rapidly on complaints of unfair trade practices such as dumping products in the United States at prices below the cost of production. It also forces the administration to act rapidly when an industry complains that a surge in imports threatens its existence. Congressmen said the change would have required the U.S. International Trade Commission to impose limits on car imports in 1981.