At War Cabinet tonight I raised the question that, as Australia was regarded as a vital base for offensive against Japan, it must be reinforced as quickly as possible or it might be lost.
2. I pointed out that Australia differed from India in that there were already in existence several divisions of fully-trained Australian troops, but that these were not properly and fully equipped with aircraft, guns, tanks, etc., that these should receive highest priority for equipment over all other needs in view of the possibility of early attack and quoted your telegram No. 176  and used its arguments. I pointed out the certainty of being able to hold Australia if so reinforced as compared with India whose basic circumstances were not so favourable.
3. I thanked the British Government for giving us priority over their own requirements in certain items as listed in My 2040  and especially in respect of their American releases.
4. Churchill said he had been in touch with Roosevelt on the whole question of war strategy, that Roosevelt was seized with the importance of defence of Australia but insisted on the intimate connection between the Australian and the Middle East and Indian Ocean theatres because the latter two might be the only doors through which aid could reach Russia and China and so assist final victory.
5. Accordingly the President had made the offer which Churchill has telegraphed you of not merely sending the 41st American Division to Australia immediately but also one further division to Australia and one to New Zealand if the 9th Australian Division and the New Zealand Division could be left in the Middle East to hold the position there.  This arrangement would secure a very great saving of shipping and transfer of troops and would, in fact, make available additional [American shipping to take two British Divisions from the United Kingdom to the Middle East theatre.
6. If your Government agrees to this proposal, in addition to the 32,000 Americans already in Australia as reported in your 162  there would be two additional American Divisions located there.
Australia would then become the principal overseas American front, and for that reason would be certain to receive very high priority of all military supplies from United States. I would therefore urge your very serious consideration of the President's proposal.] 
7. Roosevelt has also promised Churchill to endeavour to increase United States Naval Forces in the Anzac Area.
8. Churchill said that he would at once make contact with the President along the lines of your telegram No. 176 and ask that the shipping you are making available should be loaded fully with your urgent requirements if it was at all possible. In the meantime, Bruce  and I have both seen Attlee  and received his sympathetic co-operation along every path that can be used to improve your supply position in Australia.