TRADE INTERESTS READY FOR BATTLE IN U.S. HOUSE 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. The 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. Generally, the bill's provisions toughen U.S. enforcement of trade laws. The trade bill forces the administration to act rapidly on complaints of unfair trade practices, such as dumping products in the United States at prices below cost of production. It also forces the administration to act rapidly when an industry complains that a surge in imports threatens its existence. In writing the bill, the subcommittee rejected calls for trade relief for specific industries such as textiles. 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. But 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. Bill Frenzel, R-MI., 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 lawmakers to work toward a bill Reagan and Republicans would ultimately endorse. The goal of trade legislation was "to make our trade policy stronger without violating our international trade agreements," he said. In a key concession made at the urging of Ways and Means Committee chairman Dan Rostenkowski, D-IL., the trade subcommittee backed off a requirement that would have forced Reagan to impose automatically quotas or tariffs on imports from countries that engage in unfair trade practices. It also agreed the president may waive any retaliation if it would hurt the U.S. economy. Rostenkowski insisted the more moderate approach was necessary if the House wanted to pass a bill Reagan would sign into law. Reagan last year blocked Senate consideration of a tough House trade bill he branded as protectionist and this year he only reluctantly agreed to support a trade bill when he saw Democratic leaders were determined to pass such legislation. White House spokesman Marlin Fitzwater told reporters late last week that the administration still did not like some of the bill's 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, D-MO., to force countries like Japan, South Korea and Taiwan to cut their trade surpluses with the U.S. 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. 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 when he said any trade bill Reagan would sign would not be worth passage in Congress. But Rostenkowski set the tone of the trade debate by saying, "I'm not trying to write legislation to please Lane Kirkland. I'm trying to write legislation that will be signed by the president." Rep. Ed Jenkins (D-GA.) 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 of Texas, one of the most influential proponents of aid for specific industries beset by low-priced foreign competition, last week 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.