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

Cablegram 340 WASHINGTON, 8 May 1941, 7.09 p.m.

MOST SECRET

FOR CHIEF OF NAVAL STAFF [1] FROM NAVAL ATTACHE [2] TROPIC No. 10.

United Kingdom Chiefs of Staff have informed United States authorities that they are in provisional agreement with the report of the recent Staff Conversations in Washington and that they are submitting the report to His Majesty's Government for approval.

(2) At the risk of duplication I feel obliged to inform you with reference to my Tropic No. 6 [3] and Mr. Casey's telegram No. 328 [4] that the decision of the British Government has now been received.

(3) It adheres closely to the views expressed in Mr. Fadden's telegram No. 40 [5] and states:

(a) Our opinion which is concurred [with] in general by both Australia and New Zealand is that any marked advance by the United States Navy in or into the Atlantic would be on the whole more likely to deter Japan from going to war than the maintenance of the present very large United States fleet at Hawaii, and further that it might exercise a profound influence on the present critical situation in Spain, Turkey and Vichy France.

(b) Problem for the United States authorities is to so judge the degree of transfer that while still retaining the deterrent effect of a strong United States fleet in the Pacific there will also be the deterrent effect of an increased United States fleet in the Atlantic.

(c) It is not only strength but also the composition of the fleet in the Pacific which will act as a deterrent: in our view the necessary effect will not remain unless the fleet is in the Pacific consisting of not less than 6 capital ships and 2 aircraft carriers. The inclusion of the latter is considered of the greatest importance.

CASEY

1 Admiral Sir Ragnar Colvin, but see Document 355, note 2.

2 Commander D. H. Harries.

3 Document 438.

4 Document 445.

5 Document 446.

[AA: A981, FAR EAST 25B, i]