Congress returning to tough choices. Trade, farm policy, taxes, deficit all vie for attention in coming session

At town meetings, in private sessions, and at picnics during the summer break, the nation's lawmakers have heard common themes from constituents. Loss of jobs from foreign competition, the federal deficit, and farm woes are top issues in the countryside. But as members of Congress return to the capital for the fall session, they have found little agreement for action on those fronts.

The one consensus emerging is resistance to key parts of President Reagan's tax reform proposal. Voters showed little to no enthusiasm for overhauling the tax code. Most of the attention came from interest groups and individuals asking their representative to protect favorite tax benefits.

Rep. Robert T. Matsui (D) met with 800 constituents in large groups in his Sacramento, Calif., district and found that only a very few of them said they favored tax reform.

During two days of meetings around his state, a chief sponsor of tax reform Sen. Bob Kasten (R) of Wisconsin concentrated on farm and industrial problems. He was approached by a purposeful constituent during a festival at the Milwaukee zoo and asked, ``Why are you voting for the tax bill?'' The questioner, who explained he was concerned about losing his deduction for state and local taxes, admonished, ``Keep an open mind on that.''

The issue of foreign trade heated to a near boil during the summer. President Reagan's rejection of quotas for shoe imports brought criticism in hard-pressed areas and predictions of fast action as Congress returns.

But a closer look at the issue shows that lawmakers are still divided about how to act on trade.

Sen. Dale Bumpers (D) of Arkansas denounced President Reagan's decision on shoes, a major industry in his state. Republican Rep. Olympia J. Snowe of Maine charged that the quota rejection ``represented blind allegiance to an archaic trade theory at a time when we desperately need a tough, effective trade policy.''

Rep. Butler Derrick (D) of South Carolina has heard a single theme back home. ``Textiles, textiles, textiles'' is the worry, according to an aide who says that foreign competition has cost thousands of jobs as rising imports have taken over half the American market.

So much pressure is building that Senate majority leader Robert Dole (R) of Kansas is promising a trade bill next month, and even the House GOP leadership is at work on trade legislation. Democrats have begun to forge trade issues into a big political club.

Forging legislation that can pass both houses will be far more difficult. ``It's so much easier for a president to establish a trade policy than for 535 members of Congress,'' says a top Democratic aide in the Senate who works with trade issues. He adds, ``There is absolutely no consensus in Congress about what to do.''

Rep. Thomas J. Downey (D) of New York, a member of the trade subcommittee of Ways and Means, says his constituents, who are chiefly consumers, did not mention foreign trade during the summer recess. He adds that trade bills will have to wait in line behind tax reform, which is first on the Ways and Means agenda.

Representative Matsui counters that the ``pressure is going to be so great on us that we're going to have to deal with the trade issue'' this fall.

Pressure is also building on the farm front. Farm-state senators and representatives heard doomsday stories about agriculture and farm credit amid prospects of continued low prices and surpluses.

``Our rural communities are dying,'' said a young farmer in Oshkosh, where a group of farmers gathered to give advise to Wisconsin Senator Kasten. ``Right,'' murmured two other farmers in agreement.

``I don't think any of us are immune from bad debts,'' said a hog farmer, who said he is still prospering. He pointed out the dangers that all farmers face if they continue to ``raise commodities at a loss.'

Both houses return to unfinished farm bills this fall and a deadline of Oct. 1, when the current farm program expires. They are caught between farmers in dire trouble and Congress's own promise to cut spending.

In many districts, concerns about the deficit are paramount, even if the demands for specific action are somewhat vague. Although Congress passed a deficit-reduction measure just before leaving for the summer, the issue will probably return this fall.

Within the next few weeks, Congress will have a historic vote to raise the national debt ceiling. The limit will almost certainly top $2 trillion for the first time.

``I hope we'll be able to hold it hostage to some kind of reform,'' says Sen. Willian L. Armstrong (R) of Colorado. He is expected to lead an effort to block the debt ceiling increase and says he would be satisfied to force the government to go to a cash-only basis, if necessary. ``We did it for the first 150 years of our country,'' he says, adding that the prospect for reverting to that practice is unlikely.

Members of both parties foresee rough waters for the Reagan administration on Capitol Hill this fall. When the Senate returns, it is expected to pass sanctions against South Africa, a bill the President opposes. But some in Congress are confident of overriding a veto.

If a trade bill passes, it will also face a veto threat. And a farm bill considered too generous by the administration may also be vetoed.

Despite these problems, the Reagan administration has proved that it continues to determine the agenda. Despite the lagging interest in tax reform, the Democratic House will almost certainly move this month on a tax overhaul, avoiding any charge from Reagan that it is holding up his top priority item.

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