DEPARTMENT OF STATE Memorandum of Conversation
(Handwritten: May 19) DATE: May 20, 1952
SUBJECT: General Discussion with Prime Minister of Australia
PARTICIPANTS: Prime Minister Menzies Ambassador Spender Mr. Alan Watt, Secretary, Department of External Affairs The Secretary Mr. Perkins, EUR Mr. Allison, FE Mr. Thorp, E (first part meeting) Mr. Raynor, BNA
COPIES TO: G BNA EUR RA NEA - Mr. Berry Embassy Canberra FE - Mr. Allison Embassy London E - Mr. Thorp
I asked the Prime Minister what subject he would like to discuss first and he said he would start with NATO.
NATO
He said he understood that because of geographical factors Australia could not be a member of NATO and that he did not request membership. He did say, however, that he felt decisions taken by NATO had a direct effect on Australia and that therefore Australia had a very real interest in the activity of NATO. He said that Australia, in this field, really wanted two things: (a) some access to the thinking and doing of NATO and (b) some right to offer views to NATO on matters directly affecting Australian interests.
Australian Military Supply Requirements
The Prime Minister then said he wanted to tell me what his country was up against in trying to put itself in a position to make a contribution in the event of war. He said the Australian problem was not primarily that of the defense of Australia. He said he realized it was unlikely that Australia would be directly attacked; at least in the
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initial stage of hostilities. He said, therefore, what Australia was trying to do was to put itself in a position to contribute to the offense, to send out again an expeditionary force to whatever theater it was decided they should go. He said he thought the Australian record in this respect was good and it would aid the common cause if they could do so again. He said this problem of building and equipping forces was extremely difficult because Australia was a young country going through a period of great growing pains. He said the population was increasing at a rate of 3% per year which was extremely high and they had a tremendous amount of developmental work to do in Australia.
He then said that if Australia should return to the Middle East in the event of hostilities it was important to get there quickly, not six months after the outbreak of hostilities. He said Australia continued to regard the Middle East as a vital area. He said that they had been giving thought to sending 8 or 9 air squadrons to the Middle East but that they did not have the necessary equipment. He pointed out that manufacturing airplanes in Australia, in view of their small resources, also their relatively modest requirements, was a slow and expensive job. He referred to the effort and money expended in building Beauforts in the last war which had not been completed in time to be of any benefit because of the development of more advanced types. He said that it seemed to him that this type of equipment should be supplied to small countries by large countries able to manufacture in volume. He said the Australians were attempting to assemble a small number of sabre jets buying the airframes in the U.S. and buying the Avon engines in the U.K. and that they were attempting to manufacture the Avon engines. He was not certain in his own mind that all of this was wise, as probably this type would be outmoded by the time Australia could complete them. He said he had been informed that the cost of the equipment needed for the squadrons for the Middle East would be expressed in dollars, over $200 million. He stated that Australia did not have these dollars. And he added that, of course, the International Bank could not loan for this direct defense purpose. He said Australia needed assistance in preparing itself to make the contribution they would like to make and could make outside of Australia and he reiterated that if one were discussing just the defense of Australia, as was true in the case of many countries which were getting aid, that he would not be suggesting assistance.
He said he had formed a National Resources Board to attempt to plan
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but that in the absence of information with respect to overall strategic considerations both with regard to NATO and the Middle East that his government was finding planning and the allocation of resources extremely difficult.
Southeast Asia
He then referred to the importance he attached to holding Southeast Asia. He said that if Indo-China were lost he felt Burma, Thailand and Malaya would almost certainly go with the possible result that Indonesia and even New Guinea might fall with the result of bringing Asian Communist forces to the very doorstep of Australia. He said that if such a contingency occurred that no matter what commitment any Australian Government had made that public opinion in Australia would not permit any government to send forces outside of the area to the Middle East, for example. He said he thought for this and other reasons that what happened in Southeast Asia directly affected the Middle East and that events in the Middle East directly affected Western Europe and the Atlantic. The Prime Minister also commented that he felt that if a settlement in Korea were achieved that the possibility of a real "blow-up" in Indo-China would be increased. He also said that if the British were forced out of Malaya a second time that he felt it would be impossible for them to stage a second return and that this would be serious. He said he realized we had to prepare for a hot war elsewhere but was apprehensive that in so doing we would lose the cold war (which he defined as hot war fought by others) in Southeast Asia.
NATO
He said he had gone into this in some detail to attempt to show why the Australians felt that they needed to have access to the "mind of NATO". He said he felt this was important not only with respect to strategic planning but with respect to the supply of military equipment.
The Prime Minister asked Ambassador Spender if he had anything to add and the Ambassador said he merely wanted to stress the Australian feeling that NATO decisions affect everyone and that Australia should have the right to be heard not only with respect to general strategic considerations but especially on matters directly affecting Australia. The Ambassador said that Australia was not content to be the hair on the
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tail of the dog. They felt they, at least, should be part of the hide of the dog itself.
NATO and Supply Problem
I said that it might be desirable for NATO to work out some method for dealing with countries outside the NATO area. I said I had no fixed view on this and was open-minded. I then said I did feel, however, that the Australian position was based to a considerable extent on a fundamental misconception and that this misconception was that NATO is engaged in global planning. I said this was not correct and it is a fundamental point. I said that some of the smaller countries in NATO had been against this and we as well as the British had always resisted developing NATO into a global planning instrumentality. I said that NATO dealt solely with the defense of Europe and that it had had nothing to do with the Far East, Middle East or for that matter with the U.S. supply program. I mentioned the opposition of some of the smaller countries even to the idea that the same men who constitute the NATO Standing Group, wearing different hats, could give military guidance to the Middle East Command. I said there was really no place now where international global planning was taking place and that this was no doubt a defect. I said we were trying to get at the problem through the different regional organizations, planning for the defense of Western Europe in NATO, planning for the defense of the Middle East through the establishment of the Middle East command, and in the Pacific through the establishment of the Pacific Council. I said I did not mean by these remarks to take away from the importance of NATO. It was tremendously important but this was because it was building strength in Europe and taking steps leading to integration in Europe. This was vital as the individual countries are too weak to stand by themselves.
I stressed that U.S. supply programs, even for NATO countries, are handled on a bilateral basis. I said that the TCC exercise for instance had been concentrated on reviewing the programs of the individual countries in order to insure that they could be carried out without placing too great a strain on the economies. In the supply field the U.S. had been giving number 1 priority to Korea and number 2 priority to Indo-China which as a result had severely delayed, perhaps by as much as 18 months deliveries to NATO countries. I said that the problem with respect to
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Australian supplies could, therefore be handled on a much more effective basis through the Pacific Council or bilaterally. In connection with the U.S. supply program, I pointed out we are now faced with the assumption of two additional burdens: (a) assisting in the equipment of 12 German divisions and (b) attempting to accelerate the buildup of the Vietnam native armies.
Southeast Asia
I said that as to Southeast Asia we cannot now see a definite solution but that we were working on a method through which we think we can reach a solution. This method is to increase the size and effectiveness of the Vietnam native armies. I said we were assisting on the equipment and we hoped the French could accelerate the training program in order to build up effective native forces at the earliest possible date. I said we hoped this would revitalize the Bao Dai Government which had been none too strong and also in time permit the French to return some of her troops to France, this latter point being of great importance because the flower of the French army was now engaged in Indo-China which, of course, hampered the building up of strength in Western Europe.
I said we then had the question of what would happen if the Chinese stepped up their participation. I said it seemed to us that the important thing in this regard was to prevent the step-up and that perhaps the issuance of a very solemn warning would be helpful in this regard. I said this was all well and good but what should be done if the warning was disregarded. I said at this point we encountered differences of opinion in our consultations with friendly and interested governments. Should we carry the war into China? How far should it be carried into China? (It would, of course, be of great importance to avoid carrying it so far as to involve the Soviet Union.) Can we agree that the Chinese cannot be resisted in Indo-China alone? Should there be a blockade of the Chinese coast? I said it would be catastrophic if a warning were ignored and nothing were then done. I said in my view if the area is lost it must be lost only after a fight. I then added that these questions had not been discussed in NATO but by Pacific powers and that this was the way it should be. I said other questions which needed to be gone into were what parts could be played in this undertaking by the
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Japanese? By the Philippines? By the Chinese Nationalists? I said, for instance, that we thought it might be possible, although we did not know whether the present government could do it, to build up an effective fighting force of Filipinos. I concluded by saying that this was the type of problem which I thought could well be discussed in the Pacific Council.
NATO
Ambassador Spender apparently in rebuttal to what I had said about NATO said that perhaps he had not put his position entirely clearly. He said his point was that decisions made for one part of the world affect every other part and that is why the Australians feel the need of playing a part in strategic planning.
Middle East
I said that the heart of the problem in the Middle East appeared to me to be the solving of the present Anglo-Egyptian impasse. I went into this in some detail stressing the importance of the recognition of the King's title in the Sudan and our feeling that it was of vital importance to find some solution to this question. I said that until this Anglo-Egyptian problem was settled it was difficult to say how cohesion or stability could be brought about in the Middle East.
Pacific Council
Mr. Menzies said that all of my remarks emphasized to him the importance of the Pacific Council, of making it effective and of getting it started soon. He mentioned July. I said I agreed and also said it was important to get a group organized to begin discussions about the Middle East Command. I then referred to the timing of the first meeting of the Council. I said that I had the feeling that talks of some kind this summer with the Russians were probably inevitable. I hoped personally to avoid participating but could not be sure. I told of my plan for going to England in late June and of going to Brazil but said that if I could avoid personal participation in talks with the Russians on Germany I might be free in July. In this connection I outlined for the Prime Minister in some detail what the problem now is in Germany and as to the EDC and indicated the importance we attach to going
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through with these steps and not permitting the Russians, who were naturally doing all they can to sabotage these developments, stopping us. As to the Pacific Council, I said that a meeting in Australia would be desirable if possible. I said if not perhaps Honolulu could be considered. Mr. Menzies expressed the hope that the meeting could be held in Australia and that I could attend. He seemed to attach considerable importance to my attending the first meeting.
EUR:BNA:HRaynor:smw