I felt it essential in the interview with the Minister for Foreign Affairs  to avoid any impression that Australia was weakening in her support of the common front and therefore suggested that we had learned from Washington that the Chinese intervention had created the impression that she wished the talks to fail, thus risking the creation of an opinion in the United States unfavourable to China. He denied summarily that China requires intervention and emphasised the importance of Chiang Kaishek's  message (see my telegram No., 83), that China is willing for the talks to continue, but he indicated the belief that Japan would not fight and it was only necessary to call her bluff. Chinese firmly believe that Japan is not in a position to conduct large scale operations. Chiang Kaishek put the risk at four to one against in the interview with His Majesty's Ambassador.  Local press estimates the troops in Indo-China at 110,000 which is the figure quoted a month ago. The Minister for Foreign Affairs' attitude was quite inconsistent with the attitude taken by Chiang Kaishek and the Minister for Foreign Affairs to me three weeks ago. The Foreign Minister was not communicative and was vague in his reference to the modus vivendi. I think he was convinced of Australia's continued support of the common front but he later told His Majesty's Ambassador that he did not quite know what to make of the Australian attitude. He said that our objectives are to keep China in the war and protect India and Siam, while completing in the meantime our own preparations against raids.
Under these circumstances I believe it wrong to put pressure on China whose resistance may collapse after her long struggle.
Disintegration of democratic front would not necessarily precipitate Chinese collapse and China could fight on providing American supplies arrived, but if Burma Road cut China might only last a few months. Thus it seems essential to check the Japanese attack on Siam which would form a base for operations against Burma Road. I strongly urge joint Australian Dutch British decision should be sought to treat violation of Siam integrity as casus belli. Gravely concerned at evidence of British indecision over Siam. Siam represents an important step nearer Australia as well as threat to vital Chinese communications. Netherlands Indies in my opinion more vital and need encouragement.
I consider a strong attitude to Japan by ourselves and Americans is best method to check Japanese aggression and any signs of weakening will produce immediate Japanese advance. Presentation of the original American proposals in such a weak form has done considerable damage and greatly impaired Chinese confidence. Might not Casey  stress this point, as America originated the economic blockade, and urge strong attitude to Japan and fulfilment of promises to China. This is a matter in which Australia might be in a position to do some good.