DONALD REGAN'S announcement at a meeting with Republican congressional leaders that the president is willing to support some form of trade legislation establishes where the real debate on trade is going on: within the Republican Party. The Democrats have advanced some get-tough-on-trade bills. But the Democrats are just making gestures. The Republicans could end up making policy.

Leading the opponents of trade restriction are enthusiastic supply-siders such as Jack Kemp. Mr. Kemp comes from Buffalo, an old steel mill town that was one of the few metro areas to support tough-on-trade Walter Mondale. But Mr. Kemp believes the economy will bloom if you just strip away government restrictions and penalties, such as taxes and tight-money policies and trade barriers. Protectionism may help establish industries in the short term, but free trade helps existing and potential industries in the long term. Practically every economist shares this view.

But for the moment Mr. Kemp and those who agree -- and they have long seemed to include the president -- are on the defensive. Congressmen returning from recess have been hearing plenty from constituents who are convinced current trade rules are hurting them: businessmen fearful of foreign competition, workers concerned about losing jobs, local politicians concerned about established industries. They have heard as well, personally and through their political consultants, about what trade can do in 1986 for the Democrats: it gives them for the first time in years an issue on which their posture is aggressive and nationalistic, and on which they have a chance to recoup the vast number of white male votes they've lost over the years.

So it's not a coincidence that the most articulate Republican proponent of trade restriction is the political analyst Kevin Phillips. He and others, including a number of Republican politicians, see the supply-siders as too theoretical and ignorant of the way the world works, economically and politically. They believe Joe Sixpack is demanding tough action, and they want the Republican Party to deliver at least some tough rhetoric, as it has on foreign policy, crime and racial quotas.

It was to them that Mr. Regan was responding Tuesday, to them that Majority Leader Bob Dole was responding when he said that the Senate may well pass trade restrictions, and to them that President Reagan will be responding if and when he advances the kind of trade initiative Mr. Regan promised. That would be too bad. This is one issue on which Mr. Reagan's tendency to stick to a course despite the complaints and dire predictions of others has generally served the nation well.