Commerce Secretary Juanita Kreps had just finished telling the recent National League of Cities convention how she wanted to help urban economic redevelopment. Then Larry L. Simmons, a 30-year-old black councilman from a inner suburb of Detroit, stood up and asked politely, "What is going to be the future role of the cities, and what are we revitalizing toward?"

It's a fairly fundamental question. It's also an awkward one to answer befor a large audience of local officials. So Kreps did what any prudent politician would do: She ducked.

"Um," she began. "Each of us might have a different definition of what it is that a city is and does. But certainly to be a focus of a cultural, political and economic activity which serves the interests of its people by generating jobs and creating a certain kind of infrastructure . . ."

"Now how you do that, when there has been such decay, is not easy to specify," she said. Her answer trailed off in clinches about "levaraging funds" and stimulating business.

That moment said more about the state of urban policy than any formal declarations of concern. For all their professions of commitment to saving old cities, few national leaders ever venture past vagueness about where new urban jobs and investments are going to come from, much less who will benefit.

Larry Simmons' town, Highland Park, has suffered the fate of so many industrial cities in the post-industrial age. "The city grew up around three auto plants," he said later that day. "Now two of them are gone and the third has just left its offices there. I don't think we're going to see large manufacturing conerns moving back from the suburbs, so we'd better be talking about new kinds of industry.

"And then there's the investment in training and technical advice that's needed to get minorities through the pitfalls and toward prosperity," he went on. "I just don't hear anyone really talking about these complexities."

Simmons is partly wrong; urban experts are talking about such things - but he would not find their conclusions encouraging.

Many experts maintain that it is futile to try to combat the large economic changes that have reduced the overall role of manufacturing and eroded the jobs and tax bases of older cities. Paul Porter and others think that central cities can prosper again mainly as residential, cultural and commercial centers for the well-to-do. What should be promoted, they assert is the kind of middle-class redevelopment that has already transformed Adams-Morgan, Capitol Hill and other Washington neighborhoods, and is well advanced in downtown Philadelphia, Boston and other areas.

What does this mean for the less affluent people whom Simmons represents? The usual answer is that they will probably have to move - either because their jobs have gone to the suburbs or because redevelopment is pushing them out. Thus Anthony Downs and others put such stress on opening up the suburbs. And thus others conclude that where the blight is most severe and redevelopment most distant, areas such as the South Bronx or parts of Detroit may essentially have to be written off.

There is contrary approach, aimed at stemming decline and bolstering communities for the benefit of their current residents. This "neighborhoods" strategy, which began as a reaction to urban renewal, emphasizes housing conservation, social stability, selfhelp, small businesses and selective rebuilding. Various forms of this approach have been embraced by leaders of black and ethnic groups, preservationists and lovers of urban diversity. The success of programs in cities like Baltimore and Cincinnati has encouraged considerable, talk about making "neighborhoods" the new foundation of national urban policy.

But one comes back to Simmons' question: Where will the jobs come from? The answer seems to be that, unless and until vitality returns to a city in general, its revived neighborhoods will be propped up to a considerable extent by public funds for jobs, housing and social services.

This prospect troubles Simmons. He has spent a decade in local civil-rights campaigns, the poverty program, model cities and other public efforts. He is disillusioned now. "I've seen all that money come and go, and where are we?" he said. "Things are worse than before."

So Simmons has become, however unexpectedly, an advocate of private enterprise. But he has not come to this view through frustration alone; there is faith in his outlook as well.

"Back in 1972," he recalled, "when George McGovern proposed a guaranteed annual income, I was teaching a basic education class. Most of my students were getting transfer payments of some sort. I thought they'd like McGovern's idea. But most of them, perhaps 200 out of 250, were against it.

"Even though they hadn't benefited from the private enterprise system, they still believed in it. Their thinking didn't come from their current state. They thought of the condition they hope to be in."

So Simmons is very impressed by private initiatives such as Renaissance Center, the spectacular development spurred by Henry Ford that opened this mouth in downtown Detroit. And he is looking for ways "to get to convince them to invest in activities with human profit."

"Humanizing the profit motive," as Simmons puts it, may be the toughest and most uncertain urban strategy of all. It asks for large, sustained private investment in areas with huge risks and low dollar returns - investment which, many would say, runs not only against the economic tides but also against the capitalist grain. Even Renaissance Center, after all, seems rather like a fortress for the rich, walled off from the rest of central Detroit, and its benifits may not reach as far as Highland Park.

Thus when Simmons asked Kreps about the future of cities, he was really asking in part of reassurance that the private-enterprise system itself can be redeveloped somehow to help the people and communities now left behind. For both Simmons and Kreps, a new kind of private-public partnership would probably be ideal. But the obstacles are vast. And that suggests one reason why political leaders duck the question: It's hard to tell an earnest young activist like Larry Simmons that he believes, in too much of the Americandream.