137 Mr R. G. Casey, Minister to the United States, to Department of External Affairs

Cablegram 279 WASHINGTON, 24 September 1940, 8.11 p.m.

SECRET

My telegram No. 262. [1] Paragraph 3.

During the past five days possibilities of Australian-American defence arrangements have been discussed widely.

Press correspondents and radio commentators have played up rumours of secret defence agreement embracing south-west Pacific and Singapore and 'involving the possibility of an informal but closer co-operation of English-speaking parts of the world particularly with regard to joint use of naval and air bases for mutual defence'.

Three American journalists recently in Australia also contributed useful week-end descriptive articles on the strategical significance to [sic] this part of the south-west Pacific.

Radio comment has, with few exceptions, been favourable. Some newspapers have withheld editorial comment possibly with Indo- Chinese developments in view. I consider the absence of hostile editorial comment except in a few Middle Western papers significant of a general trend to favourable opinion revealed by individual writers and commentators, as well as by the strong support of some papers notably the 'Christian Science Monitor' and the 'Washington Star' and by sympathetic if guarded attitude of 'New York Times' and 'Baltimore Sun'.

Cumulative evidence of recent [weeks] [2] including Willkie's [3] public reference to Pacific air bases confirms me in the opinion that American thought is now moving outwards. American people are coming to accept the idea of outer fines defence and to appreciate the relationship of distant bases to home defence. Present interest and speculation regarding possible defence collaboration in the south-west Pacific is a logical development out of the West Indies and Caribbean Agreement [4] which happily was sufficiently close to be readily intelligible to American people.

I do nevertheless feel that this significant transformation in American opinion is not yet complete. The process, though hurried by recent events, might be checked by precipitate action on our part either in an official taking of the initiative or in seeming to do so by too vigorous comment in Australian newspapers. I cannot too strongly emphasise my view of the desirability of allowing Americans to continue to act on the assumption 'that American defence policy should be based on American interests'.

CASEY

1 Dispatched 18 September. See file AA:A981, USA 78, v.

2 Corrected from the Washington copy on file AA:A3300, 18.

3 Republican candidate for the 1940 U.S. Presidential election.

4 On 2 September the U.K. and U.S. Govts exchanged notes agreeing to the lease of U.K. bases in the West Indies and Caribbean to the United States in return for the transfer of fifty U.S. Navy destroyers to the United Kingdom.

[AA:A981, USA 78, v]