O’Neill Delays Trade Vote in Deference to Singapore Leader

House Speaker Thomas P. (Tip) O’Neill Jr. surprised some Democratic supporters today by postponing a planned vote on a major trade measure, citing a speech to Congress by the prime minister of Singapore against protectionist legislation.

O’Neill postponed action on the proposed rollback in textile and apparel imports--including those from Singapore--minutes after Prime Minister Lee Kuan Yew told a joint session of the House and Senate that protectionist measures could bring on a recession that could be “ruinous to all.”

“I did this out of respect for the visiting head of government who addressed both houses of Congress today,” O’Neill said in a statement. “I do not think it is the right thing to have this vote on the same day that the prime minister spoke to us.”

Speaker’s Decision

Rep. Ed Jenkins (D-Ga.), chief sponsor of the textile measure, told reporters that “the Speaker made the decision--whether he had consulted with the White House or not, I don’t know.”

President Reagan has threatened to veto the bill if it reaches his desk. Jenkins said the Democratic leadership indicated to him that the measure would be rescheduled for action within a week.

“It gives the White House another few days to twist arms,” said Rep. Butler Derrick (D-S.C.).

Derrick said he told O’Neill, “I don’t have any Singapore people who vote for me. I’m not concerned about their jobs. I’m concerned about South Carolina.”

In his impassioned appeal earlier, Singapore Prime Minister Lee asserted that “the answer to job losses is more, not less trade,” and implored Congress to reject trade protectionism.

‘Replay of Depression’

Lee said the protectionist path would have “ruinous” consequences--”a replay of the Depression of the 1930s which led to World War II.”

“All the major powers in the West share the responsibility for not repeating this mistake,” Lee said.

His 30-minute speech drew warm applause from the gathering of senators and House members even though many disagree with his message. All told, there are more than 300 protectionist proposals now before Congress.

Lee, who is here on an official visit, predicted disastrous political consequences for much of the world if there is a significant reduction in world trade.

Repercussions Seen

“Developing countries will have to abandon all thoughts of liberalization toward plurality and more democratic freedoms,” he said. “Severe or repressive government is the other side of austere or negative economic growth.”

If America puts up tariff barriers, “she will have to go one step further--she will have to be the policeman, to enforce order over her sphere of influence, of the world outside the Soviet Bloc,” he said.

Lee spoke as the leader of a country which has relied heavily on exports to achieve growth rates that rank among the world’s highest over the last two decades.

With two-way trade estimated at $8.1 billion last year, the United States is Singapore’s principal trading partner. In 1984, Singapore had a $900-million surplus in its U.S. trade, according to U.S. figures.

The answer to American trade deficits, Lee said, is not protectionism but steps to reduce the worth of the “overvalued dollar.”

He also recommended that Japan be “cajoled and even coerced” into opening its markets as the best way to bring U.S.-Japanese trade into balance.