ELEVEN DAYS before the deadline for agreement, the Canadian negotiator has declared an impasse and stamped out of the free-trade talks with the United States. It's not certain that the talks are still salvageable, but they are worth a vigorous rescue effort on the American side. Success could bring great benefits to both countries, and unfortunately a failure would sour relations with Canada on a scale by no means limited to trade and economics.
It was President Reagan who got these talks started, and it is President Reagan who will now have to save them -- if anyone can save them. Until now the White House has treated the negotiations as a technical matter and left them to the trade specialists. But they are loaded with political significance, and it's time for people of high and visible political standing to take charge.
If the talks finally collapse over the next 11 days, it is crucial that Canadians see that it didn't happen because of American neglect, or lack of concern, or rigidity. To Canadians, the free-trade zone has been a matter of compelling public importance and the center of a prolonged national debate that goes to the root of their sense of their nation and its place in a world dominated by much larger countries.
The key dispute is over subsidies. While both countries use them liberally, Canadians subsidize widely and anxiously to hold together a country that is geographically dispersed, thinly populated and ethnically fragmented. (There are subsidies, for example, for French-language rock bands so that, the bureaucrats earnestly explain, French will be sustained as a language of popular culture.) When an American company faces competition from Canadian exporters that it thinks are subsidized, it can start a legal attack on the subsidy and claim compensating tariffs. The Canadians want assurance that free trade doesn't mean endless guerrilla warfare against Canadian producers in American courts.
Prime Minister Brian Mulroney may have decided that this endeavor has too few roses and too many thorns. His own popularity in Canada has sagged badly, and he may simply want to end the whole negotiation -- if possible, in a way that puts most of the blame on the other side. If that's the case, the agreement can't be saved.
But the Canadians' walkout may genuinely reflect their frustration and indignation at their inability to get the attention of people in the White House who can give new energy to the search for a resolution. In either case, it is worth Mr. Reagan's while to take a hand quickly. The free-trade zone was a good idea when he and Mr. Mulroney began this exploration more than two years ago, and it's still a good idea