When presenting a note to the Dutch Minister  yesterday explaining action we were to take, he said, speaking off the record, that the objection to the Indonesians was not that they broke one part of the Agreement , but they were incapable of fulfilling any part. An examination of the Agreement makes this difficult to understand. He went on to say that, in May, when he was in Holland, the matter was discussed by the Government, and three courses seemed open. Firstly, that the Dutch get out of the Netherlands East Indies, and this was regarded as impossible, as it was vital to Holland. Second, that the matter be referred to the United Nations. This was impossible because the matter was urgent and the United Nations was renowned for delay. Third, that attempts would be made to extend the area of Dutch influence in order to make it an economic unit.
2. Throughout the negotiations, we have always felt that, each time the Indone-sians compromised, the Dutch increased their demands. We had the feeling that, in fact, they wanted to make acceptance of the Agreement impossible, and the break over police arrangements would be evidence of this, as police arrangements of the kind they insisted upon were not contemplated in the Agreement.
3. Moreover, the disposition of their Navy and forces at the time of commencement of hostilities would seem to indicate that weeks, if not months before, action of this kind was contemplated.
4. You will have at New York the strongest Dutch propaganda as we have here. Their Information Service pulls no punches and is highly organised and co-ordinated with diplomatic policy. On the other hand, there will be no Indonesian Information Service, and, surprisingly quickly, you will find acceptance of Dutch assertions of lack of co-operation by Indonesians. We have officially absolutely no evidence of lack of co-operation, in spite of numerous enquiries and also of a number of personal contacts, as, for example, the four who were in Indonesia previously. Forsyth will confirm this.
5. This information, given, I think, objectively, may be of assistance to you in your conversations with delegates at New York. It may be important, that, even though merits are not being considered, they should realise the issue is not one-sided as they might think, subject as they will be to persistent and effective propaganda against Asiatic peoples. Incidentally, Indonesian leaders and members of the Administration, as Forsyth will confirm, are well educated, restrained men, who have won the wholehearted respect of Killearn, who was acting as a third party at the time the Agreement was made.